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  1. #1
    2005 Linkshare Golden Link Award Winner  elalpo's Avatar
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    Exclamation ISSUE: reason for dumping coupons site? (Lowe’s)
    So, I got dropped by Lowe’s. And here is their reason:


    "Lowe’s reviews their publishers’ performance on a first click attribution model and unfortunately the majority of your CJ referred sales are attributed to other channels (search, email, display, etc). Because of the channel crossover, Lowe’s is basically double paying you and the channel that drove the first click which is resulting in inflated marketing costs on their end. In the past Lowe’s has tested opting out of promotion via software/toolbars and reducing commissions and distribution, but unfortunately none of these tactics made enough of an impact to consider the relationship profitable. The team appreciates your interest in the Lowe’s program and thanks you for all the time and work you have invested thus far."


    I would be interested to collaborate further on everyone's opinion on how fair/unfair this is. The channel crossover is happening in pretty much close to 100% cases - this is the way people shop now, checking ALL possible channels simultaneously. But this is especially the case for coupons sites, because generally coupons sites are a secondary channel to all other channels.

    I am just afraid to where the industry is going and how my business will be affected by that.


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  3. #2
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    At first glance, this sentence jumped out at me:
    Lowe’s is basically double paying you and the channel that drove the first click which is resulting in inflated marketing costs on their end
    How are they double-paying..?? They might review performance on a first-click attribution model, which is fine, but they appear to be paying on the last-click.

    No duplication (or inflated costs), from my understanding.

  4. #3
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    Double-paying as in, they paid their SEO team to develop SEO traffic or they paid Google for a PPC ad then they are also paying the affiliate as well.

    Multi-channel analytics is a very interesting development in online marketing. You can get a better sense for which channels are reaching new customers and which channels are closing sales. Coupon sites typically close sales and they typically don't send new customers.

    The takeaways from the data can be very subjective and should drive further testing. For instance, if a coupon site is closing a lot of sales but not referring new customers, how many of the transactions would not have happened if it weren't for the coupon site? I.e. how many customers would have not purchased without a coupon?

    Lowe's may or may not have done the research necessary to answer that question.

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  6. #4
    OPM and Moderator Chuck Hamrick's Avatar
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    We are going to have to go through a period where blue chips merchants like this shutdown coupon sites as an acquisition channel. When consumers show that they will not close a sale with out a discount code and buy from the competitor they will change their mind. The best thing you can do is promote their competition.

    Several years ago I ran a program for a merchant with average orders if $1500. In six months by working with coupon sites I added another $500k in sales. Then all at once they had me boot all of those affiliates saying that they didn't want to be associated with discounts. Two things happened, their competition discounted and thrived, they declined. After a few years they reversed themselves and offered discount, welcoming coupon affiliates.


  7. #5
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    Thanks for the clarification, guys... I'm an affiliate, and my opinion is definitely skewed towards publishers.

    The coupon channel is a tough one to objectively assess - my site is primarily content-based, and I'm sure I've lost many well-deserved sales to coupon/deal sites, even though I do show available coupons offered by merchants.

    But given the above AM perspective, I do see the benefit to the merchant if you're in a competitive niche.

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  9. #6
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    Another thing that we do to minimize the effect of coupon affiliates "stealing" commissions from content affiliates or other marketing mediums is we place a banner on the website that has our current discount and promo code.

    The downside is, we may be giving discounts to people who would have paid full-price and not gone looking for a code. The upside is, we keep more visitors on the website to buy right now instead of leaving the site to look for a coupon and perhaps getting distracted.

    Our conversion rates improve dramatically when the coupon banner is on our site.

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  11. #7
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    Quote Originally Posted by Nathan Grimm View Post
    Another thing that we do to minimize the effect of coupon affiliates "stealing" commissions from content affiliates or other marketing mediums is we place a banner on the website that has our current discount and promo code.
    I think that's the right way to do it.

    Plus, you treat all your customers equally. As a consumer, I will feel bad if I purchase something from a site just to find out later that my friend pay 25% less because she searched for a coupon code.

    The most unbelivable thing is many merchants put a big"Do you have a coupon code?" box right on their shopping cart. Why send your potential customers away to look for "coupons" when they are already on your site and ready to checkout???

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  13. #8
    Affiliate Manager bblythe's Avatar
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    @Mayfly, we have tested having a coupon box, and not having a coupon box. That little box really makes a difference! Oddly enough, consumers care about that sort of a thing even if they aren't using a coupon. Users are weird.

    I can attest that as a merchant it can be daunting looking at traffic reports and seeing users go through so many campaigns. The cost adds up, and to be honest coupon affiliates in the programs I have ran usually share the most traffic with other campaigns. That said, I always try to evaluate the publisher, not the publisher's business model. "Coupon sites" aren't to blame for the shared traffic, the user experience is to blame for that. Whether that is in PPC keywords we use, or the experience of an affiliate publisher's site. Reading that letter, it sounds to me that someone at Lowe's panicked and I think Chuck is right there will be a sort of ebb and flow as companies wrestle programs between people internally. Eventually they will take a more holistic approach to their channels, hopefully before they burn too many bridges.

    @Chuck, I also love the statement "We don't want to be associated with discounts", that is the same goofy logic behind MAP pricing. I have some choice words for MAP, but that is a conversation best had over a drink.

  14. #9
    OPM and Moderator Chuck Hamrick's Avatar
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    @Chuck, I also love the statement "We don't want to be associated with discounts", that is the same goofy logic behind MAP pricing. I have some choice words for MAP, but that is a conversation best had over a drink.
    I'm buying! Have dealt with that for a long time. Had my PPC affiliate with exclusive trademark easement lose her shirt in Nov. due to us having to stick with MAP while dealers who poached the trademark didn't. Then the merchant equal the playing field, no discounts below 5% which is what we had.

  15. #10
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    Quote Originally Posted by bblythe View Post
    @Mayfly, we have tested having a coupon box, and not having a coupon box. That little box really makes a difference! Oddly enough, consumers care about that sort of a thing even if they aren't using a coupon. Users are weird.
    bblythe, I don't quite get what you are trying to say here.

  16. #11
    Affiliate Manager bblythe's Avatar
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    Sorry Mayfly, let me try to clarify.

    Whether or not a customer used a coupon, during our tests customers indicated they wanted the coupon box. We tried to remove it all together before starting an affiliate program, and found that we had a lower conversion rate on A/B tests. During the test there were no coupons out there, so the box didn't matter. I agree with your comment, "why put a big box encouraging customers to look for coupons?", but as it turns out that little box is incredibly important.

    Also in another bit of weirdness if we make customers WORK to get coupon discounts they sometimes convert better. We redirect customers to our Facebook on all TM+ coupon terms, despite requiring more clicks customers convert better. When you mix consumers and perceived savings, it gets weird.

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  18. #12
    OPM and Moderator Chuck Hamrick's Avatar
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    Would be nice if we had a closed loop system. No coupon available, no coupon box in the cart. Also, all coupons are auto populated by a link. No codes, no links. So the merchant can send a coupon code via a retention email but it only works when you click the link in the email. So affiliates would not be able to scrap codes because they had to have the link also and that link only credited to one affiliate.


  19. #13
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    Quote Originally Posted by bblythe View Post
    @Chuck, I also love the statement "We don't want to be associated with discounts", that is the same goofy logic behind MAP pricing. I have some choice words for MAP, but that is a conversation best had over a drink.
    I'll buy as well. MAP pricing doesn't mean much if you sell product to a distributor who doesn't enforce your MAP. The sellers who respect your pricing don't sell anything.

  20. #14
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    bblythe, I find it hard to believe. But thanks for your explanation.

    By showing the "coupon box" without having any coupons available, you are encouraging your potential customers to abandon the shopping cart and go somewhere else. They might or might not come back to your site. In the meantime, you are hurting your content affiliates who have tried hard to pursue those potential costumers to your site only get send away to search for non-exist coupons.

    Merchants, if you have coupons or discounts available, display them on your sites and seal the deal instead of sending your potential costumers all over the web to look for them. You know how many possibilities out there when they leave your sites.
    Last edited by mayfly; March 19th, 2013 at 12:26 PM.

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  22. #15
    Affiliate Manager bblythe's Avatar
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    @Chuck
    That is actually a super good idea. PoolSupplyWorld has the ability to add coupons via a URL parameter, and it might be worth experimenting with. The coupon code name would still be displayed in the end, but robots wouldn't be able to grab it. This could be a huge boon for our content publishers!

  23. #16
    OPM and Moderator Chuck Hamrick's Avatar
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    I have the same with Wise Food Storage but its complicated and am working with the developer to shore it up.

  24. #17
    Member gibson's Avatar
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    Quote Originally Posted by elalpo View Post
    So, I got dropped by Lowe’s.

    if you have content pages made specifically for Lowes, you might be able to salvage your work by adding viglink or skimlinks to those pages.
    The internet is a fad.

  25. #18
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    I disagree with the practice of banning coupon/discount sites. My site focuses on retail clothing and there's a lot of competition among retailers. I've been denied access to retailers that place huge ads on their front page telling consumers they have a sale or promo code, yet when I alert the consumer that's a problem? In most cases they never would have visited their site if it wasn't for me linking to it. It costs them nothing to allow me to advertise for them... I just don't understand it. I never will.

  26. #19
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    Quote Originally Posted by elalpo View Post
    So, I got dropped by Lowe’s. And here is their reason:


    "Lowe’s reviews their publishers’ performance on a first click attribution model and unfortunately the majority of your CJ referred sales are attributed to other channels (search, email, display, etc). Because of the channel crossover, Lowe’s is basically double paying you and the channel that drove the first click which is resulting in inflated marketing costs on their end. In the past Lowe’s has tested opting out of promotion via software/toolbars and reducing commissions and distribution, but unfortunately none of these tactics made enough of an impact to consider the relationship profitable. The team appreciates your interest in the Lowe’s program and thanks you for all the time and work you have invested thus far."


    I would be interested to collaborate further on everyone's opinion on how fair/unfair this is. The channel crossover is happening in pretty much close to 100% cases - this is the way people shop now, checking ALL possible channels simultaneously. But this is especially the case for coupons sites, because generally coupons sites are a secondary channel to all other channels.

    I am just afraid to where the industry is going and how my business will be affected by that.

    elalpo,

    Based on my experience, the Lowe's team is towards the top of the class when it comes to measuring performance and understanding what those metrics mean. They aren't slave to a single metric (AOV, etc.), and it seems like they are more open-minded than most programs, especially of their size. The bad news is that they're a little ahead of the game in turning off coupon sites- the good news is that they will probably listen if you have a compelling reason that they should reactivate you.

    I would try and put yourself in the advertiser's shoes, though. If you're a coupon site, what makes you better/different from the next guy? Even if you grant that coupons help close the sale, what value does the guy who is first on the list of "lowe's coupon" provide if the 2nd guy was going to show the same coupon the same way? To address that, I would try to emphasize what's different about your site, the size of your direct audience (vs. search), and I would try to work with other advertisers to determine which metrics work in your favor.

    Finally, I would make sure that you've been sending very little traffic their way since being kicked out of the program. If you can't turn the traffic down, there's no reason at all to pay you.

  27. #20
    ...and a Pirate's heart. Convergence's Avatar
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    Quote Originally Posted by Slickdeals Alex View Post
    Based on my experience, the Lowe's team is towards the top of the class when it comes to measuring performance and understanding what those metrics mean. They aren't slave to a single metric (AOV, etc.), and it seems like they are more open-minded than most programs, especially of their size.
    I don't think so. We were terminated last month because we only sold their appliances - their largest commission rate for a category. The termination email was poorly written, as if by someone from a third world country, and was insulting to boot.

    Home Depot and others thanks them for their traffic...
    Salty kisses, Sandy toes, and a Pirate's heart...

  28. #21
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    Quote Originally Posted by Convergence View Post
    I don't think so. We were terminated last month because we only sold their appliances - their largest commission rate for a category. The termination email was poorly written, as if by someone from a third world country, and was insulting to boot.

    Home Depot and others thanks them for their traffic...
    That's a bummer- it sounds like the termination letter didn't give you any real insight into the termination. It said you were terminated *because* you only sold appliances?

    To me, that doesn't sound like the real reason; they should have given you more info. I could see justifying terminating a publisher who only sold appliances if something else were true (only coupon traffic, only sales to one mfg who is low margin, only clearance items, etc.), but that just seems silly.

    Sorry to hear about your experience, but glad to hear that you were able to sub in Home Depot.

  29. #22
    ...and a Pirate's heart. Convergence's Avatar
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    Quote Originally Posted by Slickdeals Alex View Post
    That's a bummer- it sounds like the termination letter didn't give you any real insight into the termination. It said you were terminated *because* you only sold appliances?
    They were very clear, and insulting. I had posted about it when it happened in a private forum here...
    Salty kisses, Sandy toes, and a Pirate's heart...

  30. #23
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    Quote Originally Posted by Convergence View Post
    They were very clear, and insulting. I had posted about it when it happened in a private forum here...
    Bummer. I'm guessing I don't have access to the private forum where this particular discussion happened, but I hate to hear that you were rudely booted from the program.

  31. #24
    ...and a Pirate's heart. Convergence's Avatar
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    Quote Originally Posted by Slickdeals Alex View Post
    Bummer. I'm guessing I don't have access to the private forum where this particular discussion happened
    Yeah, it's top secret and I'll probably get booted just for implying there is one.

    Really cool handshake, too...
    Salty kisses, Sandy toes, and a Pirate's heart...

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  33. #25
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    Quote Originally Posted by Convergence View Post
    Yeah, it's top secret and I'll probably get booted just for implying there is one.

    Really cool handshake, too...
    You mean like this ?

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