Why discount vouchers won’t destroy Affiliate Marketing


On Monday, Richard at Quality Nonsense blogged about "why discount vouchers will destroy affiliate marketing". Although I do agree with a few of his points I disagree with the overall message of the post, strongly. First of all, here's what I agree with.

There will always be people who look for the cheapest way to purchase an item they are going to purchase anyway. This quote from the Money Saving Expert forum says it all:

“Good timing. Need to spend a couple of hundred pound there [at Homebase].”

In the above example, Richard is absolutely right, this is not an incremental sale. But what about the thousands of people who search a voucher/offer site because they want to say buy some flowers online for Valentines day but aren't sure of where to get the best deal of who has the best offer. These sorts of people will research via sites like mine, click on the flowers category and see what offers are available. At the moment there are some offers and codes from Teleflorist, Bunches, John Lewis and Red Letter Days. The user will see these, choose one and there you go, an incremental sale. Where is the harm in that? The user gets a good deal which he/she may not have known about before and the retailer gets a sale they may not have got before, if they weren't featured on my site. I think that the voucher site haters are getting a bit blinkered in their opinions of the sector. To be honest I can understand to a small degree as we have had a glut of unscrupulous sites doing that horrid "click to reveal" thing. Speaking bluntly, I don't like this one bit. We should never force users to click to reveal, its just wrong and reeks of cookie cutting. But that aside, I do not have a problem at all with voucher code sites. I think that when done correctly they can be of massive use to end users. After all, how are they any different to cashback sites, freebie sites or any other site/directory that lists end-user offers from a certain niche? Why wasn't Richard's post called "why cashback sites will destroy affiliate marketing". Here's another major point from Richard's article that I disagree with:

People search for vouchers or cashback deals at the point of sale. Not while researching retailers: while they are a heartbeat away from entering their credit card details.

Wrong, wrong, wrong. That line should read "SOME people search for vouchers or cashback deals at the point of sale". Not all. as I mentioned above, some penny pinchers will travel to the ends of the earth to save 20p on a toaster, that's just life. But why is nobody looking at the other end of the spectrum? What about the casual browsers who just browse discount and offer sites to see what's going cheap and offers good value at the moment? There are tons of people who do this. This why sites like Hot UK Deals and the DVD bargain forums are massive. Many an impulse purchase is made through these sites. And it's true as I mentioned in this post, some retailers are taking the stance of banning voucher code sites. Whilst this is misguided I think it's due more to the poor management of discount codes by the retailer than the fact that the channel doesn't work. As long as a retailer does their (basic) maths and calculates if they can offer a voucher code, then they can be a very rewarding tool. As many of you know I look after the Secret Sales affiliate programme and guess what, we offer voucher codes. And without going into confidential specifics, they do work and they do bring in incremental volume without hurting the bottom line. I also received an email from another well known retailer this week, and this is what he said about my previous voucher code blog:

"I liked the bit in the blog regarding voucher sites and I have to say that I like working with them. They probably contribute around 80% of our affiliate revenue."

So please, let's see no more of these "voucher code sites are the devils spawn" type articles can we? Voucher code sites are here to stay and the merchants who embrace them will be the ones who flourish, especially in the current climate where more and more people are looking for a deal. What I'm listening to right now: Musiq Soulchild - "OnMyRadio"

This entry was posted in Affiliate Marketing. Bookmark the permalink.

21 Responses to Why discount vouchers won’t destroy Affiliate Marketing

  1. Jason Dale says:

    Interesting response.. much of the voucher code issues could be solved if merchants implemented better management systems.. but in the mean time we’ll all carry on arguing and pointing fingers.

    But I like this quote “They probably contribute around 80% of our affiliate revenue” – what would the contribution be if the merchant didn’t have codes? How much of that 80% is over cookied from Site 1 by a VC site at checkout… let’s see the real data and see what’s really happening.

    And if I was an affiliate looking at promoting 80% Merchant and saw that i could only offer my users one thing, but they could get a better offer elsewhere… i’d probably promote their competitor…. wonder if they include that kind of thing in their stats when they boast about them?

    Jason

  2. BFG 9000 says:

    Hi Kieron,

    I agree with your logic, but not your conclusion.

    I think the reason my opinion differs is that I categorise sites differently. Sites like yours, hotukdeals & thedvdforums are most definitely worthwhile, but – I wouldn’t class any of them as voucher code sites. I’d consider them to be deal sites & very useful ones too.
    The sites I classify as voucher code sites are simply a directory of codes & nothing else – as an example (& apologies to whoever owns it, can you honestly imagine anyone ‘browsing’ shopdiscountcodes.co.uk? I can’t – I think that sites like this are designed purely to pull search traffic for merchant+voucher (& this sort of search will happen AFTER) the customer has decided to buy.

    TTFN

    BFG

  3. Duncan Jennings says:

    Great post Kieron. As I’m sure you know there is a huge amount of generic voucher related traffic not to mention the direct traffic from bookmarks as well as email, PR, even the BBC sometimes :-) which is very much incremental.

    Duncan

  4. Simon says:

    There needs to be a bit of regulation in the US it’s full of click to reveal code sites and they often rank just below the retailer…

  5. Bob says:

    Have to say, we here have an excellent way of dealing with last-minute “merchant promo code” Googlers that I’m surprised more merchants don’t do (it’s blatantly obvious and stunningly easy when you sit down and think it through).

    From my point of view voucher code sites are much more of a threat to content/comparison/mailing list affiliates than merchants in the current ‘last click wins’ environment.

    Having said that, and as I’ve said before, companies looking to cut costs will obviously swing the axe at voucher sites first if they’ve done the maths and worked out their least-profitable route to market. Commission + discount..

  6. Sceptical says:

    Let me get this right Bob (if thats your real name)you are a merchant, am i right? and if a customer comes direct to your site and then returns at a later time via a voucher code site and buys something you de-dupe and claim the sale as your own.

    What if a customer comes to your site via a voucher code site first and then returns at a later time direct to you (inside cookie period) do you also de-dupe and claim the sale as your own?

    Judging by the tone of your comments I suspect you do.

  7. Bob says:

    No, of course not. I have never de-duped a single referral. Ever.

    What’s the easiest (and entirely ethical) way for a merchant to compete with affiliates that are ranking for ‘merchant promo code’ searches?

  8. Adam Ross says:

    Hi Kieron

    There is certainly a lot of hysteria around the subject at the moment which is why it is important voucher code directories embrace, not just the literal meaning of the IAB guidelines, but the spirit of them.

    The purpose of the guidelines is to begin to remove the misleading nature of some of these sites so merchants can accurately determine the value they have and start to view the channel more fairly.

    On the point of whether or not the sales they generate are incremental, is it really possible for any online channel to deliver pure incremental sales? Is this not an unfair and impossible task the affiliate channel is increasingly being burdened with? I blogged about this the other day (http://blog.affiliatewindow.com/?p=225), would be interested to hear people’s thoughts.

    Adam

  9. there is no question, discount vouchers like myVoucherCode(MVC) will not destroy affiliate marketing, MVC is a great site , the design is great but I have never understood why he is trying to destroy his own site?? because that is what he is doing , MVC could be even better if he just changed a few things.An increase in affiliate sites could see a dip in the online ads

  10. Sceptical says:

    Bob, I have seen you posting on this site and you seem to have a very negative and fundamentally flawed perspective on not just the industry but Kieron also. Why this is I’m not sure. In my opinion the whole voucher code debate has been blown out of all proportions and it seems at the moment people are attacking voucher code sites without fully understanding how they operate. VC sites have their own seo value as you mentioned so yes, do drive incremental sales. They also do their own PPC, again driving sales to you as a merchant. To house all voucher code sites under the same banner is idiotic to say the least. It would be like saying all PPC affiliates are brand bidders and all content affiliates buy dodgy links and steal content from other affiliates. I think you need to fully understand the industry and how it works before starting such hate campaigns against Kieron and the rest of us hard working affiliates. I would love to know which merchant you are, as I would certainly not promote a merchant with such a negative view on the Affiliate community.

  11. Bob says:

    Eh? You seem to be reading lots and lots into my comments that simply isn’t there… Where did I attack anyone, lump all voucher sites together or start a ‘hate campaign’?

  12. Bob says:

    If you don’t want a merchant’s perspective then I’ll not give it any more. All I can say is that both your comments seem to be based more on what you’d like to believe my post says than what it actually says – and this is something I’ve seen in the past from others. There’s certainly a tendency towards paranoia in parts of the affiliate community, for instance your de-duping accusation based on my ‘tone’.

    Kieron has taken some principled stands against eg ASOS based on understandable reasoning (arguably to his own commercial detriment – I’m much more pragmatic), but it would probably surprise you to learn the extent to which I don’t have a ‘negative view’ of the affiliate community. My affiliate program is built around supporting affiliates above and beyond the minimum, from fast payment to zero clawbacks/de-duping and industry-beating commissions.

  13. Pingback: Voucher Codes May Not Be Destroying Affiliate Marketing But…. | One Little Duck - Affiliate Blog

  14. Chris says:

    Hi BFG
    I am the owner of http://www.shopdiscountcodes.co.uk/ and accept your apologies for using it as an argument for your debate but cannot understand why you didn’t use your own icodes site http://www.arrsecodes.co.uk/ Why involve my site in a debate of which I have taken no part..
    Chris
    http://www.shopdiscountcodes.co.uk/

  15. Bob says:

    On the subject of incremental sales, I don’t think anyone expects the channel to deliver purely incremental sales, but merchants do need some idea of which PARTS of the channel are most likely to do so for their own products.

    Its not that difficult to judge a particular site in many cases. Much more tricky to trawl through 1000+ vaguely described, un-categorised affiliate sites on a merchant interface. Nobody’s fault – just an observation of whats present. So at the moment merchant decisions are bound to be a bit arbitrary.

    Especially if they’re pretty sure they can get their new users without VC’s. The most dangerous situation would be where a non-regular-discounting business realises they are ‘training’ their customers to look for codes where they didn’t previously. Bang goes some existing customer margin with ‘merchant+code’ searches ending up through an affiliate link. Unless the merchant puts up their own page.

  16. Chris says:

    Interesting analysis carried out by Affiliate Future based on 2 merchants, shows that lapsed time of a voucher code cookie, compared to a “content” cookie is actually only 2 mins less (23mins and 25mins respectively).

    Therefore all the concern about voucher code sites stealing last cookie, doesn’t wash completely. Obviously this is just 2 merchants, but still interesting to read. Even I thought the difference would have been greater than 2mins:

    http://blog.affiliatefuture.co.uk/2009/02/using-lapse-time-analysis-to-understand-the-value-of-your-affiliates/

  17. Picky Boot says:

    Kireon I too accept that the customers look for something cheap always. They should get something rather than nothing that is what Richard has said in his posting. He is speaking of the sites which gives out only the discount codes and nothing else.

  18. Atniz says:

    Affiliate marketing with discount coupons are gaining more popularity recently. We are tired of selling affiliate links like hosting and etc. People will only go for highest discount coupons that allow us to save more. Just like the Balck Friday offer in hostgator that gives 75% offer, I’m sure I will get a dedicated server for this rate. But, it is only for new customers. I think, the potential is there, but this is great loss for the service providers.

  19. Wow says:

    Duncan Jennings does speak:)

    Doug

  20. seo says:

    I think the main problem is that the potential customers are learning to wait for a discount or search for a voucher rather than buying the product straight away. This eventually devalues the product and causes all sorts of other side effects when it comes to tracking because the sales would usually appear days after the initial visit etc.

  21. Simon says:

    “They probably contribute around 80% of our affiliate revenue.

    So what percentage do you think look for a voucher code just as they are checking out?

Leave a Reply

Your email address will not be published. Required fields are marked *

*

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>