Promotional and Coupon Integrity in Your Affiliate Channel

[00:00:49] Jamie Birch: Hey, everybody. This is Jamie Birch, your host of the Profitable Performance Marketing podcast, and CEO and founder of the award-winning affiliate management agency JEB Commerce. Today, I got a great topic to talk to you about, and that is promotional integrity.

But before we get started, I’m recording this in the middle of Q2 2022. And you may be thinking about how you’re going to take advantage of the Q4 holiday shopping season. You’re looking ahead at back-to-school. And maybe you’re looking ahead to just getting out in the sun right now as I am. But you should be looking ahead at Q3 and Q4 of this year and making plans.

Now, if you would like some help on how to maximize your revenue through the affiliate channel, in those periods, back to school, and then the ever-important holiday shopping period, you definitely want to reach out. We can do a full audit of your program and make sure that it’s firing on all cylinders. And you’re doing everything you possibly can to make it a profitable Q4. We look at your offer, your network, your setup, the partners you have, your promotional strategy, your paid placement strategy, your recruitment and optimization strategy. Provide you with a complete roadmap in order to maximize it.

And you want to do it now. Because all of those spots – Affiliates are currently – Right now, they are talking about and finalizing deals for all of their real estate for those periods. You can’t wait until October to get this done. Now is the time to do it. And if you want help with that, if you want to take us up on our audit and roadmap service, you can email us at gethelp@jebcommerce.com and we would love to get you on the calendar and make that happen for you so you can have a really good Q4. Get a hold of us at gethelp@jebcommerce.com, and we would love to make sure that your Q4 is the best that it can be.

What do we want to talk about today? I was having a conversation with a client of ours not too long ago, just a few days ago, about coupon codes. Getting out and kind of everywhere. And what do we do about that? Well, you can probably understand what that creates as far as a problem. Whenever we do promotions, whenever we do coupons, whether that’s for a certain audience segment, or a certain channel, or just a certain time of year, or a certain publisher, we want to make sure that we can evaluate that accurately.

And so, we want it to have integrity. We want to make sure that if we give a coupon to the email channel, or we give a coupon through the affiliates, or a single partner, that they’re the only ones going to be getting that. We can go back and look at our data and say, “There were X amount of redemptions for this promotional offer. And was that a success or not?”

What can happen if you don’t have certain things set up is every affiliate will get the coupon code, and whatever code that is. And it kind of blows out your reporting and tracking on the backend, especially if you use a different database of record than your affiliate network.

And I make this joke all the time that I could put a coupon code, create one, and put it under my bed, and affiliates would find it somehow and post it. And in a lot of ways, that is true. I even had an affiliate shout out to you, David, who sent me a coupon request in a cookie cake in the icing, “Please give me a 10% off offer,” I think it was.

Affiliates definitely want those coupon codes. But we’ve got to manage how those are done. This client wanted to know, “what do we do about that? How do we protect ourselves?”

There are a couple steps that we can do. I’m going to go over those right now. The first thing is you want to make sure your affiliate agreement verbiage includes something about coupons and promotions. Do you have it in the terms and conditions that they have to accept to work with you that outlines what’s acceptable with your coupons and promotions?

I’ve gotten very specific with some of my clients in the past where I have included, if you don’t receive the coupon from myself, or an email address at jebcommerce.com, or client, it is not a valid coupon. And any orders coming through that coupon will be reversed.

You want to make sure that you outline what is acceptable. How are they going to receive offers that they’re able to promote? And what means of coupon acquisition are not acceptable behavior? That’s the first step. You want to make sure it’s in your terms and conditions so you can always go back and you can leverage, that you can reference that, and it has some bite to this binding agreement between you and your affiliate partner. Outline where they get their coupons from. What is acceptable? What is not? And what happens if they break this? You want to say that you’re going to reverse those orders because they aren’t commissionable orders. So you can always define what a commissionable order is. And the affiliate can say, “Yes, I want to participate in that.” Or, “No, I don’t.” Make sure you have that verbiage in there and be as specific as you possibly can.

And then you want to share that information regularly, in your newsletters with affiliates. You want to let them know, this is what a commissionable sale is. A reminder, if you don’t receive your coupon from maybe FMTC or from the network, if it’s not in FMTC. It’s not in the network, or it’s not in an email to you, then that is not an acceptable commission to share with your audience. Make sure that is there.

Now, there are affiliates who rely on consumer-generated content on their websites. And so, a lot of times they fall in a gray area of whether they can get commissions on those coupons. Outline that as well. And build strong relationships with those partners.

A lot of merchants, a lot of advertisers will remove those affiliates from their program. And I would caution against that. Just because you have no leverage to control what is out there, you have no means to ask them or power to ask them to remove a coupon or a promotion if you have no relationship with them. So you may not like it. You may not like what they do. You may not like that consumers are putting every offer you can possibly have out there. But if you have no relationship with them, there’s nothing you can do. Those are still going to be out there. And you’re not going to be paying commissions on them. But they’re still out there. They’re still messing up with the integrity of the promotion. And so, I would recommend working with those partners. And maybe you change how maybe it’s a much lower commission rate. Or you have them sign a different addendum. But build a strong relationship with them. So that when you have an offer that you really need to maintain integrity, that you can work with them to pull it down.

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[00:08:09] JB: Are you enjoying the show thus far? We cover so many different strategies and stories on the podcast, sometimes it can be difficult to keep up. We get it. It’s why my team and I compiled the very best strategies, and we counted 20 of them, in affiliate marketing programs and put them together for you so you can assess the health of your affiliate program and be able to optimize it for the best possible results. You can get that guide at jebcommerce.com/strategies.

In the guide, we go over how to address your commission structure, your coupon strategies, 10 questions you need to ask to identify strategic opportunities, the many ways you can utilize your affiliate partners to react and pivot rapidly to our ever-changing ecosystem, and so much more. Now, I want you to be able to access these strategies 100% for free simply for being a listener of the show. Get access to them today at jebcommerce.com/strategies. Now, back to our show.

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[00:09:11] JB: So, affiliate agreement. Getting that verbiage in there. That’s the first step. Then you want to utilize technology to protect coupon usage. Basically, many of the platforms and networks, I think Impact, Partnerize, and maybe ShareASale, LinkConnector have these capabilities. But their technology that you can say anyone who uses this coupon, it gets attributed to this affiliate. And so, if you’re doing a partnership with affiliate A and it’s a paid placement, you’re spending a little bit of dough on it, and you want to protect that, you can designate that coupon code as a protected code. And then any orders that come through go to that affiliate. Regardless of their last click attribution.

If an affiliate that you don’t want to get this code gets it and they promote it, they’re not getting paid anyway. They have no incentive to promote that offer. And they have every incentive to take it down. Because anyone who uses that coupon, that offer, as opposed to just going through a link or using a sanctioned and approved offer, they’re losing money on.

There’s great technology out there. And we may do a blog post about that, those bits of technology, and who has it. But many of the platforms and networks have something that allows you to protect the coupon usage. And then, again, make sure that’s in your terms and conditions. And make sure that you’re regularly speaking to your affiliates about these things.

Let’s see a show of hands. Who reads the end user license agreement for any apps that you download on your phone? Yep. Nobody does. And so, the vast majority of publishers really don’t read the terms and conditions of the affiliate program. You have to be sure you want to make sure in your welcome email to the affiliates, your newsletters to the affiliates, all those auto-generated emails within the network and platform, that you highlight this as something for them to take note. And then regularly talk about the agreement. And then any technology you use to protect that coupon.

And then the main tool is reversing commissions. You have to have it in the terms and conditions. With the technology that’s available to protect coupon usage, that is done automatically for you. But if it’s not, if you don’t have that utilized, if you don’t have that available to you, the next thing you do is you reverse those commissions. But it’s almost impossible to do. Will hurt your relationships long term. And if it’s not in the agreement, it’s really not legal or ethical to reverse commissions that you haven’t already stated that it’s a non-commissionable event. You want to make sure it’s in that agreement. And then you’d go back and you reverse those commissions that come through with that offer.

And you’re going to be frustrated probably at first because nothing will change. And you have to reverse those commissions. Well, that’s what happens. You will have to reverse commissions for people to see that you’re serious. And unfortunately, that’s the kind of the way it works. And I’m not bad mouth and affiliate partners. They’ve got a ton of things going on. A lot of them, again, are user-generated content. And so, those coupons are uploaded by consumers. That happens. But that will revive the partnership.

And a lot of people get pissed off and they’re like, “I’m just reversing these commissions. Screw these guys.” I wouldn’t do that. I’d let them know, “Hey, we’re reversing these orders today. They’re non-commissionable according to this section of our terms and conditions. If you have any questions, please let us know. But I wanted to let you know that by allowing or posting these unsanctioned coupon codes, you have lost this much money. We would love to work with you in a better way. And please let us know.”

Again, affiliate marketing is all about partnerships. How would you want to be treated? And think about that. How do you want to be treated? Treat them that way as well. T this is obviously a podcast targeted to advertisers and merchants.

And we talked about this earlier. You want to make sure a lot of those big offenders are in your program. You’re thinking, “Why do I want offenders in my program?” Well, I can give you a ton of examples of clients of ours who said, “I don’t want to work with that affiliate,” and they removed them. And the problem just got worse.

Because if you think, “What is the affiliate’s product?” Especially if they’re a coupon site, or a shopping site, or a loyalty site. Their product is their inventory of valid offers. As long as they are increasing their inventory and bettering their product with valid offers that the consumer can use, whether they’re getting paid for it isn’t the first objective. They want to offer the best product. Most of those, they’re going to get commissions on. But some of them they’re not. They have every incentive to keep promoting your coupons and offers, and zero incentive to work with you on it. If you’re not there, you have no control of what your brand looks like.

One of the arguments is, “I don’t want to work with coupon sites. It dilutes the brand.” And we can talk all day about that. But whether you work with them or not, they’re going to be talking about your coupon codes. It’s going to happen. Working with them gives you some level of control on what they do promote and what they don’t. And once there’s a financial relationship between the two, there’s incentive to work with you. When you kick them out of the program or you don’t allow them in, there’s absolutely no incentive. And there’s a bunch of different ways you can work with each other on that so that it is copacetic. And I know that maybe seem counterintuitive. But sometimes you’ve got to work with partners that you don’t necessarily want to in order to maintain the overall exposure of your brand and story of your brand to the consumers on all these different channels.

In the end, many of these affiliates have spent the last decade or two decades building a brand themselves. We’ve done a couple podcasts about this. That has shifted the power from advertisers and merchants to the affiliates. They have built their brand. So the consumer goes to them. And if you’re not there, it’s going to go to someone else. And you may be thinking, “Well, that’s fine. Because that’s a discounted customer.” It’s not always the case.

We have more examples of those types of sites driving high new to file, higher average order size, and more consistent lifetime value purchases. More frequent purchases than other channels that the advertisers operate in. You want to definitely grab data and see how this goes.

But if you’re working with them, they’re going to work with you to some degree. And that can be a lot better than not working with them at all and just having every offer from every channel you have out there.

And then the next thing you want to do is you want to monitor. You want to monitor this regularly. Create a process that monitors your affiliates and their coupon code usage. Execute that process regularly and take the appropriate steps. Most agreements are only enforceable if you actually enforce them. So you have to enforce it. Once everyone realizes that you do enforce it, that can change a lot of things. A lot of this revolves around your affiliate agreement.

And you may not have even looked at it. It may be a standard one that you have. And that is the biggest part of this, and then monitoring, and then working with those partners and all that. Now, if you have no idea what your affiliate agreement says, or not sure what to put in there, or not really sure how to tackle this topic at all, we would love to help. We can do a full audit of your strategy and provide you with a roadmap to take care of that. We would love to do that. You can reach me directly at gethelp@jebcommerce.com. My staff and I will work with you on exactly what you need to do to make sure that you hold up the integrity of all your channels on all their offers, not just your affiliate program. And allow the program to grow and thrive going into the Q3 and Q4 of this year.

All you have to do is email gethelp@jebcommerce.com. Reference this podcast, and we will jump on it right away and help you get the right agreement and the processes in place to manage your channel promotional integrity.

Well, I thank you guys for listening. You’ve made it this far, and I really appreciate it. If you enjoyed this podcast and learn a lot, we would love it if you shared it on your socials, and even go to the podcast player of your choice, whether that’s Spotify, Stitcher, Apple Podcasts, Pocket Casts, that’s my favorite, and leave us a five-star review. That goes a long way in helping us reach more people on this podcast. And we are always looking for guests. Right now, we are working on season three, which I think will actually have a video component as well. If you’d like to be a guest on season three of the Profitable Performance Marketing podcast, you can also reach out to that email address, gethelp@jebcommerce.com, and let us know. We’d love to get you on there. And if you know someone that, man, you would love to hear me interview them on this podcast, please let us know through that email address as well.

And one thing we’ve been doing since the pandemic started is taking Fridays and offering our help for free, no charge, to anyone who needs it. And you can schedule that time with me directly at calendly.com/jamiebirch and just find some time for us. And we can chat about coupon integrity, promotional integrity, affiliate agreements or anything that you need help with.

Well, I have enjoyed bringing this information to you guys. I hope you learned a lot. Please let us know if you need anything. Again, gethelp@jebcommerce.com. I hope you all have a wonderful day.

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