Q: I have an in-house affiliate program that pays on a cost per lead and a revenue share. Also, my company has an in-house search marketing team that advertisers via Google AdWords. I am losing some affiliates, because they are leaving the program to promote the same offer in AdWords. I can’t exactly go to the SEM team and ask them to turn off the content advertising or reduce their spend, as they are getting a healthy ROI. What can I do?
A: I faced a similar thing many years ago… I guess eight years ago when I was running the affiliate program at ClubMom.com.
I had a very successful affiliate program, and I started noticing that some of my biggest affiliates were disappearing.
It turned out that the woman doing media buys (one desk in front of me in the same department!) got the go-ahead to pay these people twice the amount I was able to pay them per lead without my knowing about it.
Meanwhile, I was routinely turned down when requesting more budget to increase the affiliate rates.
I’d say it’s really just a matter of getting the search and affiliate teams together to talk about it. If the market dictates that affiliates are working at your existing commissions, it just doesn’t make sense that the search crew is inflating the market.
Sure, they’re getting a nice ROI, but it would be better if they weren’t overspending.
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Hi Shawn,
I just want to add that the cannibalization can take many forms:
It’s also the fact that you generate and pay for traffic, by the affiliate program, that can be generated any way by other traffic sources such as SEO.
In this case it’s recommended to create different campaigns, each one will be adequate to a specific offer or create different landing pages so that every landing page tend to satisfy a specific aim from leading the campaign. For example, if your link in the search engine lead to the home page, it’s unreasonable to set an affiliate program that serve the same aim. It would be better that your affiliate link lead to a page of a specific product convenient to your target.
Another problem of cannibalization is that your affiliates bid on the same keywords that you are bidding on. They become your adwords competitors.
So for this matter that certain merchant forbid in their program that affiliates adopt paid search. But, I think you can communicate with them and see what they can do for you, in other terms tell them what words they can bid on?
(I hope I’m clear, I use to write in French).
Thank you Shawn for the hot topics.
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