Channel mix is an increasingly important topic for CMOs, Marketing Directors and any digital marketer. Where to put resources and budget across different channels can mean the difference between an amazing performance in 2015 and a dismal one. Your mix across affiliates is also an important concept to grapple with. What percentage of time, resources, and revenue is attributed to your niche, shopping, and coupon sites? What about loyalty sites? Should they be in there, or should you refrain from participating in this affiliate channel?

We hear this question quite frequently and it’s followed by comments like: “Don’t they just steal sales I would already be getting from another channel?”

“You can tell whether a man is clever by his answers. You can tell whether a man is wise by his questions.” – Naguib Mahfouz

A very wise question. I like to use examples to answer questions so I’ll use a simple one here. I’m going to talk about something that was quite common in the 80s but hasn’t seen its heyday in quite some time, it’s called a Mall. You probably pass one of these on the way to work, but maybe it’s been years since you’ve been in one. :)

Anyway… Suppose you need a blouse or some slacks (an odd word for pants) for Monday. So, you jump in your car and head to the mall figuring a retailer there has to have a solution for you. There are hundreds of stores, one must have something that will work just perfectly for you. So you go. You shop. You explore.

Now, in that mall you have Johnston & Murphy, Charlotte Russe, Kohls, Target, and JCPenney. They all have a good chance of getting your money on that day because you’ve already made the decision to buy, you just need to find the right item and one of those stores is going to have another sale to add to their bottom line.

But, there are also amazing blouses and slacks at JJill, Chicos, Sears, Forever21, and H&M. But at this mall, where you are and where your wallet is, they don’t have a store. So, although they may have something exactly like you had in mind, they won’t have the opportunity to win your business because, well, they aren’t where you are. The customer.

There is value there. There is new customer acquisition there. There is gold in them there hills!

See what I’m getting at here?

Replace “Mall” with “Loyalty Affiliate” in this example and you’ll see what I mean. Is there overlap between other channels? Yes, that happens. In the “Mall” do you receive sales from customers that just received a catalog? Email? Paid search ad? Yes. But, if you aren’t in the “Mall” is your competition?

Some caveats – I’m not addressing loyalty affiliates with toolbars and other “reminder services” that now or in the past have overwritten cookies of other affiliates. That is another topic for another blog post and something we do not support in any way, but I want to stay on one track here.

These affiliates should be measured like any other. You are going to get orders through those affiliates that would have happened anyway. But you are also going to get orders from customers who have never heard of you – the mystical and ever chased after new customers! You’ll also see larger orders from some, smaller orders from others, etc. The point is, you measure these affiliates individually against your goals. Don’t lump them together based on concept and hating the concept, throw the babies out with the bath water. There is value there. There is new customer acquisition there. There is gold in them there hills!

4 thoughts on “Loyalty affiliates – the pants analogy

    1. Thanks Karen! That is one area I didn’t really pursue here but is definitely an advantage that is often overlooked.

  1. I couldn’t agree more! I always appreciate the affiliate managers who are willing to give us a chance and see what we can do. So much of what we do is more than just posting merchants on our site hoping to get sales without any work. It’s about highlighting brands, categorizing merchants, featuring products, providing deals, reviewing stores, etc. We want to add value for our members…and that value hopefully then carries over to the merchants we work with.

    1. We definitely see it Tricia! Too often advertisers refrain from judging each affiliate individually on their own merit and throw out an entire category based on assumptions and very little data.

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