Today, it’s called the ‘Paying for Performance Teleconference’ call but it’s been around for a while. This ‘retailer only’ discussion group is generously sponsored by Vintage Tub & Bath. It’s rare that such groups allow such a glimpse inside closed discussions but they did allow me, once, to do so. The audio program and transcript are both available with the transcript of Part One appearing below. Would you like Part II?  Just send me an email and I’ll forward along.  Enjoy!

— TRANSCRIPT —

Announcer:

The following presentation is brought to you by The Partner Maker, connecting you with super affiliates and taking the work out of affiliate marketing. Learn more at the PartnerMaker.com.

Host:

Hello everyone, Welcome to our discussion on to collaborate more closely with web affiliate partners. My name is Jeff Molander and I’ll be facilitating our discussion today.

Joining us on our call — I’ll just run down real quick — we have, of course, Vintage Tub & Baths‘ Allan Dick, who is one of our industry’s greatest networkers in my opinion. Thanks, Allan, for the opportunity to commandeer your group. And I’ll do my best to keep us focused and productive.

Joining Allan is Christine Richmand from Vintage Tub as well. Julie is on the line from a major name beauty brand. Jamon Heller, I believe is on, from Factory, Card and Party Outlet Center. Jamie Mackie from Golfsmith International joining us and if I mispronounce anyone’s name, I apologize ahead of time, please, please correct me. Bobbie Zucker Bryson, is on the line. Trish Tickle, of Kitchen Collection, joins us. Rachel, who is with a major lifestyle brand in the clothing and accessories sector. John Bankroft of VF Corporation is here. Richard of Baseball Express. Patrice Colancecco-Milligan is here, a long time affiliate manager and currently in the financial services space. Kristin Collier and Dale Patruzi of Batteries.com.

I think Shawn Wagg of Rugman.com is with us; Shane, I’m sorry. And I’m told that we also have, yes, Heidi Chu, is also with us from Lamps Plus. Did I miss anybody first of all?

Robert Grosshandler:

I’m here.

Host:

Oh, I’m getting to the.. And Robert Grosshandler also joining us. Yes. You guys are next. CEO of iGive and Todd Jirousek. Todd, am I saying your name correctly?

Todd Jirousek:

Jirousek.

Host:

… Jirousek, of Vesdia Corporation. Some of you on the call, may or may not be partnered with one, one or both of these companies that are affiliates. So for the sake of discussion, each maintains, I’ll just give you a quick update here.

Each of these gentlemen maintain shopping portals that cater to a specific kind of interest group. Rob’s company caters to philanthropic cause, cause-minded type of individuals, and Todd’s company is kind of taking a major life events approach to shoppers, helping them to save money and achieve lifestyle milestones such as building a college and retirement savings.

So, without any further delay, I’ll stop talking and we’ll get some discussion going around how marketers might work in more creative ways with affiliates. That’s our subject for today and hopefully, perhaps, we’ll find out some ways in which they have not considered before working with affiliates.

Rob, I’ll, I’d like to come to you first if you don’t mind and then back over to Todd regarding your thoughts on, in particular, data feeds. Before we had the call, I heard from people via email that they were very interested in this aspect of distributing their products and services. Maybe you can start by telling us, how I give works with marketers using data feeds and how this is somewhat unique.

Robert Grosshandler:

Well, we really love getting data feeds, both catalog data feeds and as well as offer data feeds. We view our role at making our site as simple for our consumer to use as possible, and to be that portal, to be the place where our consumer, typically women, comes to figure out where she’s going to go shopping in order to help her favorite charity.

We use the data feeds from about 300 merchants to do that; it is a newer part of our site and it’s been highly successful. We find that folks both search broadly as well as deeply. The kinds of terms we’re seeing go through our search engine, shopping comparison engine, look exactly like what you might see going through Froogle or one of the bigger brand names. We find it very valuable for our consumer, and therefore we find it very valuable for our merchants that we partner with.

Host:

Todd, I’m sure, I’m not sure actually, if your sites — of all of your sites, and perhaps if you can name a few for us — if they get involved in data feeds, but I there are some creative means for marketers to work with you guys, on and off the internet. Maybe you can speak to either or of those subjects?

Todd:

On the data feeds, we don’t really work now with the data feeds. But we realized that we’re going to need to.

Little history on Vesdia: We primarily run loyalty programs on behalf of clients such as Citi and we’ve been primarily dealing with in-store merchants. That’s history of the company.

We recently made more of an investment on online marketing. So, we recently acquired Schoolpop.com and some other websites as well. And, one of the things we are really starting to do now is redesigning the websites to make them more user friendly and incorporate product enhancements like products level search, which we haven’t done in the past. I would say, while we don’t have that, one of the neat opportunities we have is Direct Mail.

Since we work with Citi, we’re able to include our merchants who we work with vis a vie network, indirect mail pieces, credit card statements inserts, catalogs etc., that Citi sends out and that reach roughly five million people on a regular basis. So that’s kind of a neat way to reach customers. I don’t think most affiliates can offer.

Host:

Absolutely, that’s what, I think, makes you guys fairly unique in that regard.

You having warmed up our affiliates guest with a few questions here. We can certainly, I can certainly ask some followups, but I’d like to hear from others, we’ll got a lot of retailers and catalogers on the line here. I’d like to see if you all have any questions that we can toss at our affiliate guests today.

Christine:

Yes, I have a question. Christine, from Vintage Tub & Bath.

We’ve been doing a lot of recruiting over the past month and one thing that we’ve come across, that is new for me because I’m fairly new to this position, is different publishers that actually have a setup fee or an insertion fee in order for them to become one of your publishers. I was just wondering if our two guests have any insight into what value added services are provided when a publishers actually charges?

Woman 1:

I didn’t understand that.

Man 1:

The question, what we’re concerned with up here at Vintage Tub, is that certain affiliates charge setup fees.

Woman 1:

Oh, like a slotting fee or something?

Man 1:

I’m not certain why, if we are paying in commission, why do we have to pay a setup fee as well. It almost seems as if the affiliates would want to be paid their commission in advance. I necessarily don’t have a problem with that, but if I have to pay my commission ahead of my sales. Then I think a reduced commissions rate afterwards is merited. I’m just curious as to what the affiliates would have to say about that, or if they have any experience with that or what the group has to say about that.

Host:

I know Rob, works that way at iGive. Maybe you can help answer that.

Rob:

Yeah, I’ll be happy to: We actually have what we think is a rather low slotting fee compared to some of the other folks who charge slotting fees. We do it for at least three reasons.

First we have a finite amount of merchandising space and we want to make sure that our partners are serious about partnering with us. There are, I don’t know, two or three thousand retailers that we could choose to offer to our member base of a 1/4 million people and we need some way of at least, easily, filtering that out. So that’s way, we have, I think, our slotting fee is either 700 bucks or 1000 bucks, something along those lines. So for it’s a quick filter for helping separate the wheat from the chaff.

Second, we do bundle in things to our slotting fee, that we hope are attractive. We have lots of different merchandising opportunities on our site merely, that go beyond a mere listing. And so for us, a slotting fee will include newsletter listings, more prominent placement on our site. And so forth.

Third, because we do have a scarce resource which is the attention of our consumer. We want to make sure that the folks that we partner with are serious about working with us. That it’s not simply, O.K., let’s just go get a listing at iGive and see what happens. We want to make sure they are interested in working with us, to maximize the messages that we put in front of our consumers.

Man 1:

Your problem, or the problem you are trying to address, is that you get retailers that come to you that aren’t serious partners. That seems to me the theme, that you want to vent out the bad retailers, or the ones that aren’t going to pay attention to it and you would rather have active merchants on your side.

Rob:

Without a doubt.

Man 1:

O.K..

Rob:

When Jeff invited us to the phone calls, we were really excited about it, because we’re in the business with our merchant partners of making sure that consumers who come to our site, get the best experience that they can possibly get. Part of that is making sure that we have the right merchant mix for them, and that we have the right kinds of offers for them, and that they’re expressing the right kinds of terms, so that we’re not interested in partnering with every Tom, Dick and Harry retailer. It’s much of the same issue that retailers have with affiliates.

Man 1:

Ha.

Host:

How about Vesdia, Todd? Do you guys ask for anything in terms of a fee upfront?

I know from experience actually in working with you all in the past with some of my clients, when I used to do program management work that you do ask for a very serious commitment. I don’t know of, if there is a slotting fee involved. But I do know that you ask for usually, the commitment to a larger type of relationship. And you mentioned earlier the direct mail aspect of that.

Todd:

We also have a slotting fee, we call it our new merchant launch package: For a new client, it’s a 15 hundred dollar, one time fee, and it includes a couple of hot deals weekly newsletters that go out to 150 thousand people each and banner placement on the category of your choice.

One thing we believe in is really introducing a new merchant to our membership: We can’t just put thousands of merchants up on our site with a text link because you are never going to find them, so for new merchants, we like to announce them to our membership, include them in newsletters that our members read and get you in above the fold banner placement, so that there’ is a greater chance of long term success for our partnership. We found that if we just bury a text link somewhere, hardly anyone is going to find it, and it’s not going to be worthwhile for either party in the long run.

Host:

Great. Anybody else have some follow up questions to that? I believe that Jamon recently joined us. Did I hear you chiming in there, Jamon?

Jamon:

Oh, I’ve been here.

Host:

You have? Great.

I know you have some data feed questions. I think actually I received an email from Christine, I believe, suggesting someone had a brand new affiliate program and I know you’re pretty new to the game. Is that right?

Jamon:

Actually we don’t have one. We are considering one.

Host:

O.K.

Man 1:

They’re a very good thing.

<Laughter from all sides>.

Host:

I don’t know if we’ve covered that deeply enough for the folks on the call: That’s why I’m bringing up data feeds again, we touched on them briefly.

Rob’s got an affiliate also like Flamingo World. They have their own proprietary comparison search engines, that’s what they are doing with those data feeds. Does anyone else have any probing questions on data feeds?

Man 2:

How prevalent is it as a part of the affiliate marketing program? And that’s related to my naive idea of an affiliate program.

Rob. : I can speak to the folks who are in the loyalty and the incentive space.

We’re seeing either they have it today or we expect them to have utilize data feeds or searching comparison engine kind of practice within the year. Or they’re creating individual landing pages that better merchandise some of the products when use the catalog based data feeds for that.

The other trend that we expect to see is more and more of the special offers that we all like to see from merchants coming through an automated interface data feed if you will, but it’s offer oriented data feeds as opposed to a catalog oriented data feed.

It means that the bigger the data feed and the more accurate the data feed, the better we are. We’re seeing a significant portion of our member base using data feeds and then shopping from the links in the data feeds, and I know that, in our case and I suspect in most of the affiliates who are using data feeds, there is no additional charge for being in that search engine, so that we’re using the traditional affiliate’s commission to pay for that service.

Unknown Woman:

This is Bobbie of FigLeaves.com.

I think that Rob brought up a good point. Even a year ago, data feeds work, if you had one, it was a nice to have kind of thing. But more and more affiliates are making that a bigger part of their business model. If you are thinking about launching an affiliate program, you’re really going to have a step up on the whole game, if you include that as part of your launch.

Man 3:

Well, is it still worth having an affiliate program if we can’t handle that type of thing?

Unknown Woman:

Oh, oh, yes. I wouldn’t say that don’t have an affiliate program if you can’t have a feed; but if you can, it’s a nice to have, because more is going to become part of the norm rather than the exception, if it hasn’t already.

Woman 2:

If you don’t have a data feed, I would say if you are going to go launch without one, be prepared with an answer for every affiliate that ask you for one.

Unknown Woman:

Exactly.

Woman 2:

Because they will.

Trish:

This is Trish Tickle of Kitchen Collection. I’m sorry I joined late… Your resident geek should be able to build you a data feed pretty easily.

Man 3:

O.K..

Trish:

They are really not that hard to build, because most of your affiliates will give you an example of how they want it built.

Man 3:

O.K..

Trish:

Which will make sense to your resident geek.

Man 3:

<Laughter> O.K..

Host:

A lot of times — and correct me if I’m wrong everyone, – -the problem, the real challenge is not creating the data feed, it’s creating the data feed in a manner that is acceptable to more and more affiliates. The more folks who keep asking for it, while there really isn’t a standard out there yet.

I don’t know if all of you received an email, if not, I know I missed a few of you before the call. I will be sure to follow up with a link to an article that just came out a couple days ago regarding movement in terms of standardizing data feeds and how some retailers are moving to look into that very seriously.

Woman 2:

If you don’t have an data feed yet, with all this coming out now. You might be in a pretty unique position and be able to align yourself with standards. That’s instead of being in the position of a lot of other data feed merchants, where they might now have to change what they are doing currently to align to standards if that goes through, or must have different data feeds based on different partners needs. It may not be a bad thing to be starting out on a data feed now.

Unknown Man:

I heard at the Shop.org conference that some providers can take the data feed, separate it out and sends it to various engines and such, on behalf of the vendor.

Host:

Sure, Performics is in that business. A company called Mercent… or Channel Advisor. There are a few companies that do that as a service.

Rob:

As a consumer of data feeds, we actually don’t care so much about the format as we do how we go get it. I don’t know the economics involved, but if you use the Performics or the Linkshares of the world to help be the middleman for that, that makes it easier for us and therefore more likely we’ll use it and use it to it’s fullest extent.

Woman 2:

A lot of us on this last call were Commission Junction people and we all have the option of putting up a data feed through Commission Junction. Does anybody use it?

Christine:

We use it. At Vintage Tub, we use it.

Unknown Man:

How hard is it to use?

Trish:

That’s what we have our resident geek for.

Unknown Man:

[laughter]

Christine:

[laughter]

Unknown Man:

In truth, Commission Junction, you’re saying?

Bobbi:

This is Bobbi at Linkshare. We were with Commission Junction, now we are with Linkshare. And you also get easily through Linkshare through their merchandiser program. And as long as you maintained a certain level as an affiliate across their entire channel, they don’t charge you.

Unknown Man:

Would you ever need a data feed not for an affiliate program? And if so could you use the data feed through your Linkshare?

Bobbi:

You can, that’s another whole topic.

Trish:

Actually the data feed that sometimes go up to different shopping comparison engines. They like to read those a little differently than the ones we put up on our commission conjunction site.

Unknown Man:

O.K.

Trish:

That’s where either you have, probably the hardest thing about data feed is being sure that it’s done on a consistent basis, and you have to pick out what that timing is, whether daily, weekly or monthly is too far apart based on your inventory.

Unknown Man:

O.K.

Rachel. : This is Rachel, and I was just going to say that we had a data feed that was pulled for another reason, and just somewhat reformatted it so that it was useful in Commission Junction, so it can be done. And so ours was threaded for a while, for search purposes.

Patrice:

This is Patrice. Yeah, it usually does help if, once you pull together the information the first time, you can have your resident geek, slice it and dice it, depending on where you going to go. The first one’s the hardest, and subsequent ones are much easier.

Host:

On the same subject of what people are doing on the merchant side, on the advertiser side, I’d love to shift a little bit and talk about what some of the…

Again the whole conversation here is about how to creatively work with affiliates, either how have you creatively worked with affiliates or looking forward, how you are planning on, and what you can do and that’s why we’ve actually invited couple of the affiliates on the line to talk about what options there are.

Anybody out there on the marketer’s side that has had, that would be willing to tell a success story or maybe a horror story about something they’ve tried, creative maneuvers within an affiliate that maybe either a home-run or an abysmal failure?

Allan : We’ll share one from the Vintage Tub, and this was on the bad side. Jeff, you’re intimately familiar with this one, so we had you help us iron this one out..

Last year we had a situation where the prices that were on one affiliate site for our products were at half price, or 80% off, and customers were beginning to call us saying we would like to buy that 1200 tub for 200 dollars! I told my affiliate manager, who was different person at that time, to immediately get that changed.

Well, she wrote to CJ, saying, please stop this immediately. Instead of investigating, CJ turned around and immediately cancelled the account which annoyed the affiliates. They didn’t realize they were doing anything wrong, they were just using our feed, and our feed was corrupt.

I never really found exactly out what happened at that time, but we didn’t have any direct contact information with her. This affiliate turned around and then blabbed about us and it actually got some traction online. Not a huge amount, but it just goes to show you that if you don’t have a direct means of communication with your most important affiliates, this is the kind of stuff that can happen.

This was a mistake that just grew well out of proportion to what was really going on!

One of the things that I wanted to ask the affiliates that are on the call: We seem to have trouble getting affiliates to communicate with us. We actually have a higher commission structure for affiliates that we have direct contact information for. Now as direct result of this, we never want to repeat that mistake again. We want to be able to talk to folks and get the situation resolved without having to communicate through a third party, which is why I think the problem happened. So that was a mistake on our part. We don’t want to repeat it. And I’m curious as to what the affiliates have to say about how can we improve our relations with our affiliates. How do we get our affiliate to give us contact information?

Host:

Rob or Todd? Maybe you want to take that one?

Rob:

Todd, why don’t you go for it?

Todd:

Well, I tell the affiliate managers I work with that they can give me a ring anytime. I work from my home office, so as long as if it’s not after six o clock or so…

Allan:

When you are part of a network, is there any thoughts, does any of the retailers have any ideas of how you can “incentivize” or kind of cut through the clutter and develop a working relationship with your affiliates?

That’s where we’re at: I really don’t want affiliates that aren’t willing to communicate with us. Because, not surprisingly, the ones that don’t like communicating with really don’t send us a lot of revenue. It’s the ones that we have contact information for that actually do the best, and want to be partners.

Woman:

I have all the contact information for about the top 30 to 40 of my affiliates. I just went to network and said these are the ones I’m missing, please get me the information. Now they can only get you the information they have on file, which sometimes is inaccurate, but I could probably pick up the phone and call, I’d say, 98% of my the top 30 – 40 affiliates that have the contact information.

I just keep it in a spreadsheet and try to at least call them occasionally just to touch base. You know a lot of times, sometimes I’ll put it in the newsletter, make sure we have your correct information on file. Not that they always read their newsletter, that’s another whole challenge.

Allan:

But you actually send out a newsletter. You’re trying to maintain, you’re maintaining contact reach with your affiliates in a group manner as well as individually.

Woman:

Also, In addition to that, my top performing affiliates and sometimes not even the top sales affiliates, but those that communicate best with us, post us, I have a separate external email list that I created just in outlook and sometimes I’ll send them an separate email if there’s a hot promotion or something to sort of reward them and give them a heads up and this way they are not having to filter through everything that goes through Linkshare.

Allan:

Right.

Woman:

So I have a special list, and Todd you’re on the list, and Rob also is on the list, and they get a heads up from me whenever we something special going on, a special promotion that we haven’t told anyone about it. And the more people that find out about it, they want to get on that list too.

Man:

One of our other vendor does that too, a CJ vendor. I don’t know, we get six or eight hours advance warning of whatever the hot deal is. And it gets read. I don’t understand personally affiliates who don’t want to be in communication with their merchants. Just doesn’t make any sense to me.

Allan:

It mystifies us. — I just don’t understand it.

Woman:

Before I got on the conference call, I was just looking for the best way. I was looking at some other information.

But there was a post from an affiliate who was appalled that she received an email from a retailer asking for her contact information. If you read all the responses, I assume there are other publishers, but they are all in support of her: “They don’t need to know your phone number or your email address.” So its frustrating, there’s something an it’s an “Us Against Them” feeling.

Kristin:

This is Kristin from Batteries.com. I will not approve of an affiliate unless I can find some external email address or some other contact information and verify it. I try to keep in contact with all my affiliates, try to keep them close to heart. Last week I ran a competition trying to urge them out of the woodwork and got some pretty good results out of it.

Patrice:

Going one step further from that, this is Patrice.

We don’t work with the network that won’t provide us the information upfront: We take it to a whole other level, but we won’t even work with someone who won’t give us that information at the get-go. So we aren’t even worried whether or not the affiliate wants to give us the information, we are worried about working with the network that will provide us the information without us having to coax it out of the affiliates who may or may not want to do that.

Woman:

I agree, I absolutely agree.

Man:

Is there a, what was it an affiliate list, with something, that had bunch of affiliate contact information in it. There’s something flowing around out there. I think Jeff’s involved with.

Woman:

Jeff?

Host:

Sure, we launched a product that speaks to this, to what I hear, so far is a concern to everybody on the call: People who expect to be able to pick up the phone or to at least be able to understand what, how the affiliates wants to be communicated to.

We published a product of leading affiliates around 200 or so that work with retailers. None of the names would probably surprise anybody on the line, although there are some names who certainly with people starting out in the business might benefit from knowing these folks.

This product was a kind of response to the fact that I heard a lot of people out there saying, we want to know our affiliates, we don’t have that ability from our affiliate networks to have direct contact with them. We would love to know how they would prefer to be contacted. We went out there and ask the affiliate how they would prefer to be contacted. Some preferred email alone, some people preferred the phone, some people preferred both. Some people don’t want email at all. They want a web contact form, where is that web contact form. We provide that on the list. Other profile data, helping advertisers understand where affiliates get their traffic from. Essentially where they send their traffic to.

Transparency is what everyone is saying there. So that at some level, you want to know who you are dealing with. And you put a big priority on that. Sounds like Patrice and a few other people flat out will not work with a network or will not work with an affiliate that doesn’t provide their level of transparency that they demand and I guess that level is different between different people.

Woman:

I also was making sure my affiliates have some kind of external contact information. I make myself extremely available to them. Phone, email, MSN messenger, yahoo messenger, ICQ, everything I can think of, I’ve signed up for and made it available to the affiliates and to let them know them can contact me whenever they want to.

Man:

Let me jump in that’s very appreciated. I can’t tell you how many of our merchant contacts, say something like affiliates@befree.com and don’t even have a name attached to it. So, by making yourself visible to the affiliate, the affiliate may feel more comfortable about making themselves visible to you.

Woman:

For some of the merchants, I don’t remember how many people ago it was that talking about not approving people if you can’t find external contact information. Is that something that you kind of put in your description of a, like a company description that affiliates may read when they are going in to apply to different programs, Is it something they know upfront or?

Woman:

I do not have it in our program terms or with commission conjunction. Our program terms are quite long. We are kind of trying something out. I don’t have a list in there. Anyone who does contacts me, I will flat out tell them, I could not find contact information, if you provide that for me, I will reconsider, I’m working on building. I’m also a developer for batteries.com, and I’m working on building a password protected homesite for our affiliates where they can come and get tips and information, and a more detailed policy will be located there.

Woman:

O.K., I’m a merchant as well, and I have the same problem where with Commission Junction. I have the same problem as far as the amount of information and I just, some of the feedback I’ve gotten from affiliates, I will answer back anyone who bothers to write to me to ask why they weren’t accepted, and I will also go back and revisit an affiliate site to make sure I didn’t make a mistake or overlook something or whatever.

Woman1:

Right, Yeah that’s what I tend to do as well.

Woman2:

O.K. I was just curious or not whether it was something: I’ve had people come back and say, that you should have this, this and this posted so that we know that first.

Woman1:

I’ve never gotten that before. I’ve never been told that I should have it up there.

Woman2:

Yeah, that’s what I thought, what I figured, I was just curious how you kind of dealt with those.

Announcer:

This concludes Part One of our discussion on what affiliates want: Best practices in affiliate marketing.

Tune in to Part Two of our program, when one company reveals it’s embroiled in a lawsuit involving it’s data feed.

Also, the group discuss what works and what doesn’t work when working with affiliates in an out of the box manner. Once again, the group seems to struggles with affiliates that don’t want to engage in discussion. How can one identify a potential unique opportunities for collaboration if affiliates aren’t interested in holding discussion.

The group also discusses the dilemma of affiliates programs that in fact are based largely on the work of affiliates who choose to remain anonymous, and how affiliate marketing seems almost to be alone in it’s rather addictive acceptance of anonymous business partners. If you are just starting up or contemplating an affiliate program, you won’t want to miss this segment which touches on running one’s own affiliate program outside of an affiliate network.