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Managing Success In A Downturn
1. Managing Success in a Downturn:
Analysing & Motivating Channels
within Affiliate Marketing
David Harding-Customer Acquisition Manager,
Argos
Daniel Powel- Head of Account Management,
Commission Junction
2. Agenda
Argos/CJ Overview
• Argos
• Commission Junction
Market conditions
• Recessionary trends
• UK retail in recession
• Discounting trends
• Argos in the downturn
The Argos affiliate campaign: Overview
• Stats
• Key drivers
• Levers for growth
• Case study
Engage and reward
• Communication strategy
• Supporting performance
• Retention and rewards
• Summary
3. Who is Argos?
Home Retail Group is the UK’s leading home and general merchandise retailer
with sales of over £5.8 billion in the last financial year, resulting in a 10%
market share.
Multi-channel retailer selling The UK’s No. 1 home
over 24,000 products across the enhancement retailer
Sales in 08/09 financial year
offline and online business
17m households in the UK have reached £1.5bn
Sell over 30,000 products
an Argos catalogue
Sales in 80/09 financial year across the home enhancement
reached £4.3bn a market
Argos.co.uk is the most visited Over 330 stores and 4m ‘spend
online retailer with a high street & save’ loyalty card holders
presence
4. Who is Argos?
Catalogue in over
17m households
Delivery & Check &
40m produced
twice yearly
Reserve
Over 18,000
Products
5. About: Commission Junction Europe
Areas of influence:
Ireland, Netherlands
285 active programs Hubs
14,000 active publisher accounts
Countries managed from
neighbouring hubs
Countries with active advertisers
and publishers
Areas of influence:
Austria, Poland, Switzerland
145 active programs
7,000 active publisher accounts
Areas of influence:
Belgium, Italy
115 active programs
5,000 active publisher accounts
Areas of influence:
Norway, Finland, Iceland, Denmark
60 active programs
2,000 active publisher accounts
(Launched July 2008)
Areas of influence:
Portugal
16 active programs
2,000 active publisher accounts
6. The Argos Affiliate Program
The Argos affiliate programme is our most established online marketing channel which
continues to grow and perform year on year:
• Argos has been working exclusively with CJ on the affiliate
program since 2003
• Affiliate sales growth in 2008/09 was significant
• Argos works with over 4000 affiliates on the program and has
a very active base
• Argos works with a large mix of affiliates across a variety of
business models
• Affiliate sales now contribute over 5% of total online sales a
growth of 18% YOY
7. Agenda
Argos/CJ Overview
• Argos
• Commission Junction
• Recessionary trends
Market conditions
• UK retail in recession
• Discounting trends
• Argos in the downturn
The Argos affiliate campaign: Overview
• Stats
• Key drivers
• Levers for growth
• Case study
Engage and reward
• Communication strategy
• Supporting performance
• Retention and rewards
• Summary
8. Market Overview
• Ad spend 2% of GDP since 1919
• “Blurring of above the line” and
“below the line advertising”
– Above declines in recessions
– Below grows...
Discounts, vouchers, search=
CPA and COS...all below the
line.
• Email is on the way back, still largely
driven by large CPA, but that is
changing
eMarketer UK Online Ad Spending
“...that we do not end up trading analogue dollars for
digital pennies”-Jeff Zucker NBC
9. Retail in the UK: Times are tough
Like-for-like retail sales
have been negative for
9 of the last 10 months
Big Brands are
suffering
Low Consumer Confidence
Consumer Spending is still slow
Declining Exchange Rate
16. New Ways to Achieve Reach
42% of internet users said they look for discounts • Email-steady growth, but not just CPAs anymore
•
first
– More growth expected in 2009 as shoppers • New ways to give and earn
become more savvy and price conscious
17. Affiliates are customers
• Do affiliates know what we offer?
• What are the key levers on their site?
• How can we increase AOV and conversion?
Source: Channel Advisor
18. Argos Affiliate Campaign: Key
Focuses
‘Affiliates are our customers’ therefore we should have an affiliate centric strategy
that addresses following areas:
Supporting
Performance
Insight & Acquisition
Understanding
Argos
Affiliates
Analysis to
Developments
& support growth
new technology
Retention, Communication
&
Reward &
Engagement
Activation
19. Argos Affiliate Campaign: Analyse for Growth
Strategic Top New
Partnerships Affiliates
Software Comparison
Affiliates Affiliates
Argos
Top Top
PPC Content
Affiliates
Growers Fallers
Affiliates Affiliates
Voucher Incentive
Affiliates Affiliates
New Affiliate
Active
Recruitment
Affiliates
21. Case Study: C&R Affiliate Campaign
To target highly trafficked affiliate sites and encourage new and existing customers to use
check and reserve in the final two weeks of peak when we have a competitive advantage over other
multi-channel retailers.
Objective:
• Promote the C&R proposition
• Acquire new customers and convert existing customers to C&R users
• Maximise traffic and C&R sales
EMAIL ACTIVITY
BESPOKE SITE CONTENT
BANNER ACTIVITY
Campaign Results:
• 25k reservations – over £1m of reserved product
• 13k customers – 17% of customers were new to Argos and 20% new to C&R
22. Agenda
Argos/CJ Overview
• Argos
• Commission Junction
Market conditions
• Recessionary trends
• UK retail in recession
• Discounting trends
• Argos in the downturn
The Argos affiliate campaign: Overview
• Stats
• Key drivers
• Levers for growth
• Case study
Engage and reward
• Communication strategy
• Supporting performance
• Retention and rewards
• Summary
24. The Unknown Does Not Stick
Affiliates are your first voice, give them something to say
Source Channel Advisor
25. Getting the word out
•• The store still isn’t the
The store still isn’t the
first stop for shoppers
first stop for shoppers
•• Different affiliates need
Different affiliates need
different content
different content
•• Make the affiliate site
Make the affiliate site
stickier
stickier
Entice
Engage
Activate
Source Channel Advisor
26. Affiliate Communication & Engagement
All affiliates have different requirements according to their business model and their
level of engagement with the Argos brand
Targeted Promoting
Communication Planning Mets
Partners
New/Inactive
Lapsed
Affiliates
Segmented Business
Models
All Joined Affiliates
Non-Joined Affiliates
Untargeted
Solus Base Email
Communication
27. Case Study: Christmas iPod Touch
What was it?
• Save £120 on the iPod touch – Now Only £149.99
Objective:
• Widespread Exposure of the deal through the affiliate market
• Early communication for maximum exposure
• Maximise iPod sales
Campaign Results:
Maximum reach and exposure through affiliates
The hottest deal ever on Hot UK Deals
Sold over 3500 units – More than 23% of the overall business sales through affiliates
28. Supporting Affiliates to Deliver Performance
Cross-channel Consistent &
Voucher Codes Ongoing
Promotions
Cross-Channel
Integration
Supporting Affiliates to Deliver Performance
New Product
Analysis to optimise
Offerings
Ongoing Conversion Rates
Communication &
Transparency
Choice, Value & Argos Product
Convenience Feed
29. Supporting Affiliates to Deliver
Performance
IMPROVED CONVERIONS, SALES &
NEW CREATIVE & TECHNOLOGY
Content Plug Dynamic
Widgets Ins Banners
MANAGEABILITY
AFFILIATE CREATIVE
Flash
Product Feed
APIs
Banners
Development
30. Case Study: Argos Home Event
Objective:
• Build launch awareness
• Shifting brand perceptions about the furniture range
• Maximising home event and furniture sales
BESPOKE ACTIVITY
ON-SITE/OFFLINE
COMMUNICATION BANNERS
Campaign Results:
Wide reach and exposure across the base
Selected partners helped to build and alter brand perceptions of the Argos furniture range
Individual competition with an affiliate helped generate over 8000 entries
Total Sales through affiliates reached over 7% of total online sales
31. Affiliate Retention & Rewards
Focusing on retaining and rewarding high performing affiliates will put your brand
front of mind and ultimately lead to greater loyalty engagement and sales.
1. Web Developments to maximise conversion
2. Promotions to maximise sales
3. Relevant Information & Brand Transparency
4. Understand key issues (affiliate survey) & encourage
feedback
5. Tactical Activity and Incentives
6. Programme of competitions for new and growing affiliates
7. Argos Affiliate Service
32. Affiliate Insight & Understanding
Analysis of each affiliate channel to provide insight into the value of all business
models within the affiliate marketing mix. This should in turn help you to minimise costs
but maximise incremental sales
• Argos.co.uk order data
• Customer journey on-site
• Website Browsing data
Analysing Online
Activity
• Channel Centric Metrics
• New customer acquisition data
• Customer Journey data
• Customer purchase frequency
• De-duping data by channel
Understanding Analysing the • Customer retention & LTV data
• Store collection data
the Customer Customer
Journey Database
33. Past and Present
Then... The Future....
• Before 2007: Search • Content, bigger
better feeds
• 2008:
• Cashback, rewards
Content, comparison
• Mid 2008 onwards: • Email
Category Specific Sale Count
Cashback, reward • Blogging
Other
0%
Software 2%
1%
Search
8%
Content Voucher/Discount
17% 29%
Cashback
Comparison 11%
22%
Incentive
10%
34. Summary-Affiliates
• Segment & analyse your affiliate base
• Communicate and engage with your affiliates
at all levels
• Support affiliates to deliver performance
• Focus on retaining and rewarding your
affiliates
• Gain insight and understand the value of your
affiliates
35. Managing the Internal Challenge
• Argos is a traditional retailer
• Internal PR
– Sales Growth
– ROI
– Case Studies
• Budget Challenge
– Uncapped
– Work on a COS (not just media buy)
– Fast Payment
