Lowering acquisition costs through affiliate marketing
Published: 17 Dec 2009
In-Depth: HotelClub’s Head of Global Partner Distribution, Raphael Lanfant, on affiliate marketing
Having an affiliate programme may not guarantee results, but it does guarantee that you’re not paying for lack of results.
Affiliate marketing diversifies marketing risks and over reliance on one specific marketing channel, says Raphael Lanfant, Head of Global Partner Distribution, HotelClub. According to Lanfant, affiliate marketing is about partnering with people, not only about search engines algorithm and bid management.
Lanfant spoke to EyeforTravel’s Ritesh Gupta about affiliate marketing. Excerpts from an interview:
An industry executive told me: “Affiliate marketers are often much better at SEO than merchants.” How do you think affiliate marketing has emerged as a strong option for marketers to optimise their spends when it comes to cost per acquisition?
Raphael Lanfant: Affiliate marketing comes as a long term strategy to complement other online channels such as SEO, Paid Search or advertising. Affiliate marketing diversifies marketing risks and over reliance on one specific marketing channel. It increases top line whilst protecting bottom line (as affiliate marketing is about performance remuneration) and improves marketing share of voice on search engines (in addition to own SEO and SEM placements) and offer more merchandising options. In recession times and scrutinised spend periods, affiliate marketing is an effective technique to lower acquisition costs. Again, affiliate distribution is long term as it takes time to build a performing distribution network and ramp up sales.
The beauty of affiliate marketing is you pay for what you get. Tenancy and CPM agreements are useful for branding exercises, but being able to pay for specific results (e.g. player acquisition, depositing etc) can mean better value for marketing money. What do you think works in favour of affiliate marketing especially in this sector?
Raphael Lanfant: In travel, lots of publishers/affiliates try to apply their specific SEO knowledge to quickly gain scale in one of internet most competitive sectors.
Partnering with affiliates in the travel sector lead to have different tools to suit diversified affiliate needs.
What works with affiliates:
-Communicate with affiliates often to identify enhancements opportunities
-Maintain regular communication: product, market trends, promotions, etc.
-Strong consumer offers for affiliates (not only generic deals but specific promotions)
-Performance based commissions
-Publish clear SEM keywords policy
-Encourage affiliate partners to share their plan to sustain their (your) growth
If you set up an affiliate programme properly, over time, it can become a profit centre for your business. What do you think one needs to be wary of?
Raphael Lanfant: My recommendations are as follows:
Affiliates who have the skills to succeed with SEO definitely stand to profit. How do you assess the situation or expertise in the travel sector?
Raphael Lanfant: Lots of SEO affiliates in this sector due to the popularity of Internet sales for travel players. It’s critical for affiliates to develop long term SEO strategies with unique and valuable content for internet users. Not only the product content from merchants.
What according to you is most critical when deciding on commission structures to offer in an affiliate programme?
Raphael Lanfant: Transparent, easy to understand and reachable commission structure.
I suggest implementing an incentive scheme to ensure affiliates can project them toward a clear sales objective.
Commission structure depends on merchant’s objectives: sales, leads, traffic, branding… and the effectiveness/bookability of its website to reach the desired action/metric.
Can you elaborate upon what role do efficient sales tracking and Operations and Account Management/ Support play in running a successful affiliate marketing programme?
Raphael Lanfant: Tracking is the backbone of any affiliate programme. Merchants need to be able to build trust with their affiliates in regards to the correctness of results tracking and related remunerations.
Tracking should encompass specific and precise reporting capabilities to meet the needs of affiliates for further analysis and control of their marketing strategies.
Account management is key as most affiliates will be willing to interact and discuss marketing techniques and to improve their usage of the merchant’s tool to further increase sales.
Merchants shouldn’t refrain from sharing often with their affiliates partners: best practices, SEO tips… and shouldn’t underestimate the power of human relationships.
Affiliate marketing is about partnering with people, not only about search engines algorithm and bid management.
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