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Amazon vs. Walmart: Affiliate Marketing Lessons to Learn

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This presentation is from Affiliate Summit East 2015 (August 2-4, 2015 in New York, NY). Session description: One is the planet's biggest online store; the other is the world's largest company by revenue. Both engage affiliates to drive sales. Come to discover how & what practical lessons merchants can learn.

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Amazon vs. Walmart: Affiliate Marketing Lessons to Learn

  1. 1. Amazon vs. Walmart: Affiliate Marketing Lessons to Learn Geno Prussakov CEO, AM Navigator (affiliate management agency) www.amnavigator.com Founder, Affiliate Management Days (conference) www.amdays.com 888-588-8866 | Washington, DC geno@amnavigator.com | @ePrussakov . and
  2. 2. Comparing the Giants (or Mind-Blowing Facts)
  4. 4. Mall of America
  5. 5. Disneyland
  6. 6. MONTHLY VISITORS: 80 MILLION PEOPLE could fill: 24 Malls of America and 60 Disneylands Source: PCMag, “Infographic: Just How Big Is Amazon.com?”
  8. 8. Madison Sq Garden
  9. 9. WAREHOUSES: 70 MILLION SQ FEET that’s more than: 700 Madison Square Gardens and could hold more water than 10,000 Olympic Pools Source: Business Insider, “10 Mind-Blowing Facts About Amazon.com”
  10. 10. PROJECTED 2015 REVENUE: $100 BILLION that's $190,132 per minute and $15,844 every 5 sec Source: Morgan Stanley’s Scott Devitt as quoted at ZDNet
  11. 11. 49 MIN OUTAGE (JAN 2013): $3.2 mln+ LOST
  12. 12. AFFILIATE PROGRAM Source: NAJobBank.com, 2008 job posting
  14. 14. AFFILIATE PROGRAM Amazon.com Associates: The web's most popular and successful Affiliate Program Page Title Says It All:
  15. 15. Source: Deloitte.com
  16. 16. Out of all retailers, Wal-Mart has the greatest capacity to compete with Amazon online. Geno’s opinion
  17. 17. Annual web sales in billion U.S. dollars. Source: Statista. Copyright © 2015 Top 10 U.S. e-Retailers in 2014
  18. 18. Interesting Facts (2014) o Amazon owns every fourth dollar spent online in the U.S. (and every third in Q4); o For the first time in a decade, Wal-Mart's web sales grew faster than Amazon's (30% vs 20%); o Yet, in 2015 Amazon is on track for $100 billion in revenue, predicted to eclipse Wal-Mart.
  19. 19. How Do They Run Their Affiliate Programs? …and what we can learn from it
  20. 20. 1. Program Support Websites
  21. 21. Source: AffiliateBenchmarks 2013 Global Advertiser Research Report Top Recruitment Methods (adv)
  22. 22. Source: AffStat 2014 Report by Affiliate Summit Top Recruitment Methods (aff)
  23. 23. 1. Program Support Websites
  24. 24. 1. Program Support Websites
  25. 25. 2. Performance Incentives
  26. 26. It Does Pile Up… Source: Darren Rowse, The Ultimate Guide to Making Money with the Amazon Affiliate Program, ProBlogger.net, 4/24/2013
  27. 27. 3. Low Payment Threshold If you select payment by direct deposit, we will directly deposit the advertising fees you earn into the bank account you designate, but may accrue and withhold advertising fees until the total amount due to you is at least $10. Amazon.com Associates Program Operating Agreement
  28. 28. 4. Variety of Links Text links   Banners   Product links (feed)   Advanced creatives  widgets  flex links Video    Thousands of linking options  Convenient categorization (by product lines and types of promotions)  Intuitive interface
  29. 29. Deep-Linking Capability
  30. 30. Deep-Linking Capability
  31. 31. 5. Ease of Integration © 2015 Universal Studios
  32. 32. Key Elements: o Resources (to educate) o Incentives (to motivate) o Tools (to equip) o Support 5. Ease of Integration
  33. 33. 6. Communication Channel
  34. 34. 6. Communication Channel
  35. 35. Affiliate Manager’s Responsibilities
  36. 36. 6. Communication Channel
  37. 37. 6. Communication Channel
  38. 38. Source: 2010 Affiliate Summit AffStat Report Affiliate-Preferred Newsletter Frequency 6. Communication Channel
  39. 39. Most Desired Affiliate Types per AffiliateBenchmarks 2013 Global Advertiser Research Report 7. Empowering Bloggers
  40. 40. Source: Technorati Media 2013 Digital Influence Report 7. Empowering Bloggers
  41. 41. 7. Empowering Bloggers
  42. 42. Application Programming Interface – a set of functions and procedures that allow the creation of applications which access the features or data of an operating system, application, or other service. Oxford Pocket Dictionary of Current English 8. Equipping Developers via APIs
  43. 43. 8. Equipping Developers
  44. 44. 9. Attracting Mobile App and Game Developers
  45. 45. 9. Attracting Mobile App and Game Developers
  46. 46. 9. Attracting Mobile App and Game Developers As a mobile app developer, I’m very interested in Amazon’s In-app-purchasing (IAP) and Mobile Associate (MAP) program. Most affiliate programs seem to focus on desktop experiences... On mobile, most browsing time is spent inside apps, and most users will try to avoid clicking on something that will interrupt the in-app experience by opening up a window in the mobile browser since it ‘breaks the flow’ of navigation (even if it’s a web-view within the app). An API such as Amazon’s IAP/MAP allows a purchase to happen within the same context where it was originated and allows mobile developers to create purchasing experiences that are more pleasant for people using apps to get ideas on what to buy.
  47. 47. Loyalty Affiliates o Amazon.com: 17.6% o Walmart.com: 13.5% Affiliates Using Diverse Methods: o Amazon.com: Q1 – 5.6%, Q2 – 4.1%, Q3 – 6.09%, Q4 – 10.85% o Walmart.com: consistent 2.3-2.9% range throughout all quarters Source: AM Navigator 2009 Affiliate Survey 10. Heavy Focus on CRO
  48. 48. 11. Fairness to “Closers” If the customer clicks an add-to-cart link built with the Enhanced Product Links tool, the Amazon cookie is now set to 90 days (instead of 24 hrs for most other inbound links). And unless the customer removes the product from their cart, affiliate commission is secure for 90 days. Sometimes, a customer needs an extra day to checkout. So not using direct the add-to-cart links (vs. a more broad landing page) can hurt the affiliate.
  49. 49. 12. Exclusive Contracts
  50. 50. You may NOT: • employ, use or place any web browser add-ons, toolbars or pop-ups on your website; • employ the use of any type of software download or technology which attempts to intercept or redirect traffic or Referral Fees to or from any website; • install spyware on another person’s computer; cause spyware to be installed on another person’s computer, or use a context based triggering mechanism to display an advertisement that partially or wholly covers or obscures paid advertising other content on a website in a way that interferes with a person’s ability to view that website; 13. Stance on Affiliate Adware Source: https://affiliates.walmart.com/#!/terms
  51. 51. 14. Policies on TM-Centric URLs Unsuitable sites include those that: (g) include any trademark of Amazon or its affiliates, or a variant or misspelling of a trademark of Amazon or its affiliates, in any domain name, subdomain name, or in any username, group name, or other identifier on any social networking site Amazon.com Associates Program Operating Agreement You may NOT: • use the Trademarks, or any variation or misspelling thereof, in metatags, hidden text or source code, in your domain name or any other part of your URL Walmart.com Operating Agreement for Affiliate Network
  52. 52. Source: Darren Rowse, The Ultimate Guide to Making Money with the Amazon Affiliate Program, ProBlogger.net, 4/24/2013 15. Holiday Marketing
  53. 53. 15. Holiday Marketing
  54. 54. 15. Holiday Marketing
  55. 55. 15. Holiday Marketing
  56. 56. 15. Holiday Marketing
  57. 57. To Recap…
  58. 58. Lessons to Learn 1. Maintain program support website 2. Motivate with performance incentives 3. Set low/reachable payment thresholds 4. Provide a wide variety of linking options 5. Make integration/activation easy 6. Support constant & consistent communication 7. Empower bloggers & content producers 8. Equip web developers and savvy affiliates 9. Attract mobile app and game developers 10. Focus on conversion rate optimization 11. Fairly compensate the real "closers" 12. Encourage exclusive relationships 13. Disallow affiliate adware 14. Prohibit TM-centric domains 15. Leverage holiday marketing
  59. 59. In Conclusion…