October 23, 2014

Overview of Coupon Affiliates

Not long ago, positive year-over-year affiliate revenue numbers provoked approving nods from around the conference room. “Get top spots on some of the big coupon sites and you’ll be golden,” I heard in the hallway.

Today, merchants pull down codes, commission rates are scrutinized and advertisers are leery of coupon affiliates. So, what happened? Are coupon sites suddenly bad for merchants?

Inquiring affiliate managers with better internal and network analytics are uncovering patterns in attribution that lead them to question the incremental value of some affiliate sales. However, before we start slashing commissions and expiring publishers, we need to understand the whole landscape.

Research Confirms the Value of Coupons

More than 50% of U.S. Internet users (92.5 million) say they plan to use online coupons this year, according to eMarketer.com, and 74% of these online coupon shoppers say they search multiple coupon sources each and every week. Consumers who earn $100,000 or more per year represent the biggest percentage of online coupon consumers. The vast majority of consumers (88%) who visit coupon sites say that coupons “close the deal” when they are undecided on a purchase, according to a 2011 report conducted by Forrester Research on behalf of WhaleShark Media.

What are the Options?

Many brands have a coupon box within their checkout—inviting consumers to leave in search of a coupon. Before cracking down on coupon affiliates, consider testing this coupon box. What happens if the box is hidden? What coupons do your competitors offer? Are there certain products that can’t support a price cut? Perhaps adding exclusions or lowering the discount may allow your codes to stay profitable.

Assess Your Traffic from Coupon Sites

Some large coupon sites may have only a few minutes between the click and the sale – suggesting consumers got a coupon code during the purchase process. Other coupon publishers may have a delay between click and sale – suggesting greater incremental value. Publishers using paid search, social media, newsletters or blogs to promote their sites may reach consumers earlier in the buying process. Compare the data on publishers appearing on page one in natural search for keywords such as “[Your Brand] coupon” versus “Shoe coupon.” Perhaps it makes sense to increase commission or offer a vanity code for certain coupon publishers in exchange for category and newsletter placements to improve brand awareness. Perhaps it makes sense to split commissions more fairly to account for the value of each action in the sales funnel. One of our client’s chose this route.

If you’re interested in learning more about the role of coupons in affiliate, download our free introductory slide deck.