A compensation structure for paying online affiliate marketing partners should be based on whether the customers are new to the file, according to Anne Driscoll, Internet marketing director for jeweler Ross-Simons.
Compensation should be based on the metrics of the affiliate type (coupon site, loyalty site, etc.), and since affiliates are your sales force, they should be paid well, countered Rick Renaud, online customer acquisition manager, Gardener’s Supply Co.
These were just two of the differing viewpoints Driscoll and Renaud offered in a point/counterpoint session on affiliate marketing during the New England Mail Order Association’s spring conference on Friday. Driscoll took the more conservative stance, while Renaud took a more liberal view during the session, moderated by Chris Bradley, president of Cuddledown.
Driscoll noted that her strategy depends on technical capabilities, and that it took them a year to develop a program to make that work. Renaud added that while you want to build loyalty with affiliates and reward good sales, many companies could probably not pay as high a commission to some affiliates, such as couponing sites.
On the topic of whether to restrict affiliate bidding on keywords, Driscoll said absolutely, particularly when it comes to trademarked terms like your brand names. Giving affiliates free reign to bid on trademarks could lead to paying for site visitors who should have come to you in the first place.
Renaud felt that it was a better tactic to not restrict the affiliates, and let them take the risk of cost per click bidding. You can control the ROI, he said, because you’re only paying for sales. Why do cost per click when you can do cost per acquisition?” he said.
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