An Introduction to Performance Marketing. Website:

Transcription

1 An Introduction to Performance Marketing Website:

2 An Introduction to Performance Marketing for Your Business In this guide to performance marketing, we're going to be covering the most basic concepts of performance marketing; the benefits, what sort of sales you'll generate, what tools you'll need and who the major affiliate players are. But first, we'd like to whet your appetite with Digital Fuel's exclusive offer for start-ups and small businesses: Digital Fuel's Small Business Offer For a limited time, Digital Fuel is offering start-ups and small businesses the opportunity to join the Digital Fuel Affiliate Network for free and run your own in-house affiliate programme: Benefits Test your conversion funnel Drive converting traffic with no up-front cost Reach overseas customers Gain a new sales force Get advocates of your products & services promoting them Work with digital marketing experts that are available to help Demonstrate your business model & financials for potential investors Offer Join free and expose your product to Digital Fuel's existing affiliates - no set up cost, no monthly management fee (for at least 12 months) Free creative suite of advertising banners for mobile, desktop and tablet Free Google & Bing paid search set up with $100 in free traffic Chance to win $500 paid search traffic - drawn each month from all advertisers Dedicated account manager dealing with your queries and managing your affiliate relationships The only cost to you is the commission paid to affiliate and 25% override paid to Digital Fuel on commissions due to affiliates (e.g. if you choose to pay an affiliate $100, you would pay Digital Fuel an additional $25, for a total of $125)

3 Requirements Advertise your affiliate programme on your company website (see example) Recruit potential affiliate partners from your industry Place our pixel on your website in order to track sales Commit to running your affiliate programme for a minimum of 6 months.

4 Basic concepts of your performance marketing program What is so special about performance marketing? The Internet provides endless opportunities for people to succeed. Whether you have (or know someone who has) a product to sell, a service to market, or a website that gets great traffic, the Internet can provide maximum advertising power without draining your advertising budget. Setting up your own affiliate program gives you the ability to control your own corner of the online marketing world. Affiliate programs fill the needs of online advertisers with maximum exposure and provide inventory for online marketers, which translate into profits and sales. Anyone with the right tools, knowledge, and drive, can create their own affiliate program and start increasing revenues. What benefits can I expect? With a performance marketing program, you can increase sales by only paying for results. You'll work with affiliate networks, such as the Digital Fuel Affiliate Network, and/or direct publishers and set the rules for your offer. You'll set the offer location (URL), payout, the daily, weekly or monthly volume thresholds, approved traffic sources, creative requirements (banners), and best of all, you only pay when sales or leads are generated on your behalf! The sky's the limit with an affiliate program. As long as you have the inventory to support continued growth and make good decisions on building performance relationships, your profits will continue to grow. Many successful affiliate programs are bringing in ~$85K in profit within the first year, but depending on the offer, it can scale much more quickly.

5 This all sounds good, but what tools will I need? If you're an online business owner, you probably already have most of the tools necessary. All you need is a way to sell your product online, a website, a shopping cart, etc, and performance marketing software to track and manage your affiliate program. By joining the Digital Fuel Affiliate Network, we take care of the software, so there is no need for you to purchase an affiliate marketing platform in order to take advantage of affiliate marketing. Tell me, who are the players within performance marketing? The User is the customer. They make online purchases, fill out your surveys, sign up for your services, etc. Sometimes referred to as visitors, traffic or the target audience. The Advertiser is the seller or merchant - you! You are looking for users and traffic specific to your products or services which will result in leads or sales. The Affiliate is the publisher. They have relevant websites or traffic sources for your target audience and generate revenue by promoting advertisers' offers (products/services) and getting a percentage of sale amount or flat payout for generating a conversion. The Digital Fuel Affiliate Network is the relationship liaison. Affiliate Networks such as Digital Fuel are the middleman and act as a broker for the advertiser, almost like an agency for affiliate marketing. Affiliate networks recruit affiliates to promote products and/or services. The network specializes in finding and managing both advertisers and affiliates so advertisers are free to focus on their products/services and affiliates are free to focus on publishing and promoting offers.

6 Easy enough, but how do these players relate to each other? Advertisers have products/services and want to gain exposure by reaching the largest target audience. Affiliate Networks act as mediators between publishers and advertisers. They recruit affiliates and advertisers, track all activity, arrange payments, and help affiliates set up the necessary links on their websites. Publishers work as representatives of the affiliate networks. They promote the advertiser's products/services in exchange for a payout or commission of each sale or lead resulting from their efforts. I'm ready. Give me more details about performance marketing programs! Small businesses interested in adding performance marketing to their online advertising mix can utilise the Digital Fuel Affiliate Network to increase leads or sales. Rather than needing to purchase software and do a complex technical setup, the small business can piggyback on Digital Fuel's existing affiliate network and software for a simple and quick integration. The advertiser will create a page on their website advertising their affiliate program. Digital Fuel will manage all aspects of the performance marketing program through their affiliate tracking software using the details and URL for the offer provided by the advertiser. Affiliate programs will produce a tracking URL which contains several pieces of information, including an identification number for the publisher, the offer, and the URL of the advertiser's offer. A conversion pixel is generated by the affiliate program's tracking software and then placed on the confirmation page of the advertiser's website. Placing the pixel on the confirmation page enables affiliates to receive credit for the sales or leads they generate.

7 The affiliate then publishes and places the link on their website or alternative traffic source for potential customers to click on. When a user clicks on a link, the affiliate program's tracking software records the click and the tracking URL tells them which publisher sent the user to the advertiser's offer. The program tracks sales using browser cookies containing those same identification numbers (from above), tracking which publisher referred the user. The affiliate program pays the affiliate for each lead or sale generated on their behalf. Now that we have the basics of affiliate programs behind us, it's time to learn about optimizing your offers for publishers to promote.

8 A brief introduction to affiliate offers What are the different types of offers? There are a countless number of different types of offers, but they typically fall within two different categories: Lead Generation and Product/Service Sales. Lead Generation Offers collect personal information of potential customers and qualify where they fall within the purchase process. This data is handed over to the advertiser's sales team to start generating customers. Lead Gen" information might be collected through list sign ups, lead generation forms, newsletter sign ups, ebook downloads, survey completions, and several others methods. Product/Service Offers typically drive users to ecommerce sites, shopping cart experience, or service sign up where users can purchase products/services with a credit card, PayPal, or some other electronic payment. Service offers allow visitors to request information about services to be provided at a future date; electronically or physically. These offers can include paying in advance on a website or at the time of service. Again, the defining characteristic of a product/service offer is that the user must provide a form of payment. How do I determine my affiliate payout? First of all, you need to know that publishers almost always work with several different affiliate programs, and even with your competitors. Publishers promote offers based on their expected return, the highest ROI for them not you. Ensuring your payout is competitive is a key component to a successful performance marketing program. Digital Fuel can research the market price and find a competitive payout or your program won't grow.

9 Another major piece to determining your payout amount is your own margin of profit. Though you may have additional budget for marketing channels, affiliate marketing is different. In order to scale your affiliate program, it will need to be a profitable program. For example, if you sell widgets for $5 and it costs you $1 to make them, you cannot pay publishers $4. You need to determine the amount you're willing to give up for publishers that are making the sales.

10 What are the different ways to payout? There are three main types of payouts to publishers, finding the right one that fits your business model may take some testing and tweaking, but one of these five should get you there: Cost per Conversion (CPA): means that the affiliate program will payout the publisher with a fixed fee for each conversion recorded. Cost per Sale (CPS): offer means the affiliate program will be awarding a percentage of the sale amount to the publisher. This is common for offers where multiple products can be added to a shopping cart, and thus compensating an affiliate for all of the items purchased by the user. Cost per Conversion plus Cost per Sale (CPC+S): is a hybrid payout method in which publishers will be compensated a flat dollar amount per sale plus a percentage of the total sale amount. This type of offer encourages publishers to generate large sale amounts while still giving them a base payout per each sale. What are the different affiliate payouts structures? Categorized Tier Payouts assigns publishers into different buckets, sometimes depending on; traffic volume, content quality, type and quality of traffic, etc. For example, Publisher X drives high quality traffic; he's categorized as a Gold affiliate and gets 30% commission. Publisher Y sends low quality visitors but high volume traffic, resulting in mediocre sales each month; he's a Silver affiliate and only receives 20% commissions.

11 Publisher Z sends millions of spam s resulting in tons of traffic to your site and almost no sales; he is your Bronze publisher and only gets 10% commission. In this structure, you're able to reward high quality/volume publishers with competitive payouts, while low quality publishers receive lower payouts. Scaling Payouts is designed to reward publishers to drive more traffic to your offer. You pay your publishers more when they exceed monthly thresholds. For example, if an affiliate drives 50 sales per month, they receive 10% commission, if they drive between 51 and 100 sales per month they receive 15%, and so on. This is a self-selecting reward system; you pay top producing publishers more and encourage them to continue driving high quality traffic to your offers. Additionally, it encourages your low volume affiliates to drive more sales in exchange for higher payouts. Digital Fuel recommends setting a competitive flat payment and looking to reward high performing publishers additionally if required. How do I optimize my offer for publishers? Publishers like to promote offers that run specials and promotions. This gives their users a reason and sense of urgency to click on your offer. Think about promoting a 24 Hour Special" or Deal of the Week." These are time sensitive promotions that expire and are always being refreshed. Your publishers often have repeat visitors or members" of their site. Publishers need to remain trustworthy and credible or they can lose these users/members. Help them out, offer a guarantee with your product/service, put customer testimonials on your page, have a no hassle return policy. These are basic elements that will instil confidence and increase sales. Digital Fuel can provide an audit of your conversion path if required.

12 How can I optimize my checkout/landing page for publishers? Optimizing pages is an art and never ending process, which Digital Fuel's online marketing and design experts can help you with, but let's touch on a few best practices for optimizing your checkout/landing pages: Remove advertising banners, distracting links or useless objects users can click on and distract from making the purchase. Minimize the use of pop-up windows (another distraction from your desired action). Make sure users know exactly what to do when they land on your checkout or sign up page, provide clear and to-the-point copy that makes it easy to sign up or purchase. How can I stand out to publishers? 1. Publishers are driven by data: Digital Fuel's performance marketing software provides real time access to reports for your affiliates. Providing as much data as possible enables your publishers to optimize their campaigns and generate more sales, more effectively. 2. Provide your publishers product information and content they can include on their site. Think of publishers as your salespeople. You're going to want to educate them, you wouldn't send a new hire on the sales floor without any training, right? Great performance marketing programs will even provide their publishers with products so they are familiar with what they are promoting. Educate them with the benefits and why potential customers need your product/service.

13 Understanding Publishers Now it's time to learn the role of publishers, how to think like a publisher, and talk about how publishers operate their businesses. The role of a publisher To better manage publishers that join your program you must first understand a little about publishers themselves. You should know what they want, what they look for in affiliate programs, and the tools they need to be successful. One of the most important things to publishers is the opportunity to represent a product or offer they have confidence in; one they would purchase themselves and use on a daily basis. For this reason most publishers choose to represent products related to their interests or areas of expertise. This helps give publishers the drive, knowledge, passion and interest necessary to successfully promote your offers. How to think like a publisher To recruit publishers, you need to understand their needs and what drives them. You'll have trouble recruiting publishers if they're disappointed when they visit your website, if your payouts are low, or if you're not specific in your affiliate agreement. The first thing they're looking for is the right offer. If the offer doesn't match their traffic sources, their users won't convert and they won't make any money (and neither will you). For example, if they have a website that provides reviews for Hollywood movies, they'll be looking for offers that fall into the same niche of interests. Perhaps they would look for offers that showcase celebrities. If they're trying to monetize traffic they've purchased from Google Adwords, offers that have low price points, free trials, or sign up forms work best for these users. In CPA (cost per action), affiliates have to make sure the offers they promote match their users. On top of that, your offer has to have a great conversion rate. As an advertiser it is your job to make sure that a reasonable percentage of people that enter an offer actually complete it. If something happens to your sales funnel and visitors are no longer converting, publishers start losing money by the second.

14 The second most important thing to a publisher is getting paid. This means they're looking for clear terms and conditions, competitive payouts, and responsive affiliate management. Publishers need to trust the affiliate programs they're working with to payout on time. You can imagine the pressure associated with buying traffic for an offer and not receiving payment quickly enough. It can seriously bring a publisher's business to a screeching halt. Along the same lines, publishers need to trust the tracking platform your program uses. They want to make sure every conversion they generate is recorded so they are compensated fairly. Downtime and broken tracking issues are the biggest pet peeves of any professional affiliate. Digital Fuel uses leading affiliate software, HasOffers, that is well known and trusted by all serious affiliates. A successful performance marketing program accurately represents their offers so publishers can best match it to their audience, they make sure their offers convert, they payout on time and have reliable and trustworthy affiliate tracking software in place. Set your program apart by providing your publishers with accurate and transparent data and a variety of tools to help them make you money. You should always be testing new landing pages, banners or trying to squeeze another 1% out of your conversion process. How publishers target an audience Most publishers find that focusing on a particular audience is very important to their long-term success. Picking a specific niche or subject is one of the most effective methods for building up traffic sources with a very targeted audiences. For example, a publisher might choose 'personal finance software' instead of 'software'. This allows publishers to build their own marketplace and target one specific audience looking for help with personal finances. In order to identify a potentially successful niche, affiliates evaluate their passions, interests, and hobbies. Once they've narrowed this down to a few topics, they'll need to perform extensive research to determine which options will be most viable, popular and profitable. Publishers look at the demand for the products related to their niche, they investigate the market and level of competition. A great publisher knows how to fill a need that already exists. They're able to find customers with specific wants and expectations and provide them with a solution: your offers.

15 Applying to your program Before a publisher can begin promoting your offers they must apply to your program. The publisher will visit your site where you can refer them to the Digital Fuel Affiliate Network and they can complete an application to become a member. The application will ask for personal information (name, address, payment method) and information about the affiliate's site(s) or traffic sources, and provide a service agreement. It also provides a field where the affiliate can specify if they are looking for a particular advertiser's campaigns (i.e. yours!). Digital Fuel will screen and approve/deny the affiliate, establish payment arrangements and explain the affiliate tracking system in place. Now you know the basic concepts behind performance marketing and are ready to begin your own program! For more performance marketing tips and resources be sure to follow the Digital Fuel blog. If you have questions or would like to speak with someone on the Digital Fuel team about starting your affiliate program with us, please our team at affiliates@digitalfuel.com.au

16 Let's Get Started If you would like to get started and launch your affiliate program with Digital Fuel, please get in touch via