Archive for August, 2009

Lifetime value through rev sharing

Wednesday, August 19th, 2009

TradeDoubler initiates an innovative solution to improve customer lifetime value though the affiliate channel

On 2nd June Quidco.com launched a revenue share model for Minxy Bingo (part of the Gala Coral Group) which entitled Quidco members to a 30% revenue share on all their losses for a lifetime. This is the first ever revenue share model of its type to be implemented across a major loyalty or cashback affiliate. The launch of Minxy Bingo was followed this week by Gala Bingo, one of the UK’s leading bingo brands, also incorporating a revenue share model on Quidco via TradeDoubler.

Over the past six months, TradeDoubler and Gala Coral have worked together to improve the lifetime value of customers delivered through the affiliate channel, in particular those delivered through incentive-based affiliates. These are affiliates that traditionally pass the commission earned from transactions back to the end user in the form of cashback, points, air miles etc.

After considerable analysis, Gala Coral established that this affiliate sector generally delivered strong volumes of customers, however only a small proportion of these customers continued to play again and again. Therefore the cost of acquiring a customer through cashback and loyalty sites became less profitable for Gala Coral and led the business to alter its strategy and implement a revenue share solution.

Working alongside the Quidco team, TradeDoubler and Gala Coral have been able to develop a revolutionary revenue share model where a Quidco member is incentivised to continue to play after they have registered a Gala Bingo or Minxy account. The revenue share model will mean that any customer that has registered via Quidco will be rewarded 30% cashback for the total amount of losses in their Gala Bingo or Minxy account each month for life.

The revenue share model has been utilised across the iGaming sector for several years and encourages stronger lifetime value of customers through the affiliate channel. The model has enabled advertisers to provide bespoke revenue share commissions to affiliates based on the quality of the customers they are delivering.  Taking this into account, it is not uncommon for so called ‘super’ affiliates to be rewarded on a hybrid CPA/revenue share deal where they are rewarded on the customer acquisition as well as the lifetime value.  This is a model that all affiliates on revenue share strive to move towards, even for new revenue share affiliates like Quidco.

The revenue share model also ensures less risk to the advertiser as they are not rewarding on the acquisition of a customer, but on the net losses the customer makes through the gaming site. With advertising budgets being reduced and a key need to retain customers in a difficult economic climate, there is no doubt that this commission metric will begin to be introduced across other verticals over the coming months.

Across Telecoms and Utilities, affiliates could be incentivised for customer contract renewals, or, for Finance, rewarding on renewing a home or car insurance policy. Given that switching providers can be faster and a lot less painful for consumers, thanks to the rapid growth of comparison sites, advertisers are urgently trying to find a way to retain customers – maybe the integration of a revenue share model is the answer?

“Quidco is working closely with TradeDoubler to evolve new ways for advertisers, who have traditionally experienced issues with lifetime value of customers, to use cashback sites more intelligently. By offering an advertiser the chance to pay its customers cashback based around revenue share, we can address many of these issues – meaning the advertiser benefits, as well as the customer. In this particular case TradeDoubler, Gala Coral and Quidco have reshaped traditional thought in the gaming sector and are making what was previously a theoretical idea for incentive sites, a live trial.  If this proves to be a success, I imagine we’ll see many more advertisers and incentive sites following in our footsteps.”
Emma Faulkner, Sales and Marketing Manager, Quidco.com

Dharmesh Damani
Senior Business Development Manager
dharmesh.damani@tradedoubler.com

If you would like further information on how the revenue share model works, please feel free to contact Dharmesh.

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IAB Ethical Merchant’s Charter

Wednesday, August 19th, 2009

We want to make you aware of a recent IAB Affiliate Marketing Council initiative that TradeDoubler and some other UK Networks will be supporting.

The objective is to increase the transparency of information shared by advertisers, as a recent survey suggested this was a big concern for affiliates. This will help publishers to select the right programs and also understand how best to work with them.

Information such as the reasons why sales are deleted/reversed and the deduplication rules employed are examples of the types of information likely to be included.

Right now, all we are doing is gathering feedback from advertisers and publishers. We expect the types of information to be confirmed soon. We will then look to gather this information from advertisers to update program information pages. The initiative is voluntary and we do understand that advertisers may need to keep some sensitive or strategic information confidential.

If you have any questions about this initiative please contact your TD Account Manager.
the full article

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Middle classes using shopping vouchers more

Wednesday, August 19th, 2009

According to an article published by the Telegraph.co.uk on the 13th August 2009, it seems that Britain’s middle classes are far more likely than the working classes to use voucher codes for their online shopping. According to the study carried out by the data company Experian for Paypal, it showed that most deals are available to shoppers who have access to the internet, and it shows that the middle classes are the savviest at accessing these discounts and offers. Sites  such as MyVoucherCodes, vouchercodes.co.uk, MoneySavingExpert are growing  in popularity due to their ability to collate the latest discounts, consumers have more exposure to the different offers and discounts available, therefore increasing the use of the discount codes and increasing the traffic being driven to these type of sites. The report shows that 70 per cent of ABC1 consumers have used some form of money off voucher in the last six months compared to  62 per cent of C2DEF consumers.

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Cross-Media Tracking

Wednesday, August 19th, 2009

The days of managing different marketing channels in complete silo from each other are possibly short lived, as increasingly more and more advertisers are interested in understanding the impact of each channel on the other. What the effect of a banner campaign is on search, and what uplift, if any, is there in traffic and sales. You can also add to this the need to dedupe sales across different media, particularly affiliate, as most advertisers do not want to pay out a bounty to their affiliates if they were not responsible for generating the sale based on the last click wins model. The potential overlap/duplication can be worked out, but mostly by manual and time consuming methods, whereas a technology specifically designed for this purpose can automate this process and provide time efficiency. Furthermore, some technology products can also provide insight into the touchpoints involved in a user journey cycle, and where each channel is involved in the purchase cycle.

It has long been suspected that search traffic will increase, (particularly brand searches) when another channel is also used. If you think of some of the traditional marketing models such as AIDA, a number of marketing channels can be placed at the beginning of this process, Awareness, Interest and Desire. Once those levels of desire have gone past a tipping point, some action will occur and this could be a brand search on a search engine, or a search of merchants on a cashback loyalty site, ultimately resulting in a sale.

For the modern day digital marketer, the path the consumer takes across these different channels is high value information, and being able to understand how the different channels fit together and ultimately combine to drive a consumer through AIDA should result in higher, but cheaper sales for the advertiser.

 

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Posted in News, td Affiliate, td Campaigns, td Integral, td Search | 3 Comments »