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  1. #1
    Member chris7530's Avatar
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    Strategies for working with coupons affiliates
    What are some of the strategies merchants are using to ensure coupon sites are providing incremental traffic? In my experience most (90% +) of the traffic from sites like retailmenot, coupons.com etc is from customers who were already in the checkout process so they do little to improve sales and end up costing both margin and commisions. There are also customer service issues with bad coupons and, these sites will set their affiliate cookies even when no coupon is offered.

    Here's a few that we've come up with (would love to hear from others):

    1) exclude them from your program. PROS: don't have to pay commissions and you'll notice they will still include your coupons for free. CONS: they may more aggressively promote your competitors on your landing page (although I see this even with paying merchants on retailmenot).

    2) hide the coupon input box in the checkout process. PROS: people won't search for coupons and are less likely to leave the checkout process and not come back. CONS: need to develop a way to selectively show coupon input box for email campaigns etc.

    3) only pay commissions to coupon sites based on the new traffic they bring to your site. PROS: will end up lowering amount paid to coupon sites by 90%+ CONS: requires sophisticated analytics to understand which sessions are new and the data may not be easy to integrate with linkshare/cj's tracking

    4) given difficulties with #3, do analysis offline and adjust coupon site commissions accordingly. This will likely be 10% of base commissions.

    5) actively police violations of policies and deny payments. For example, many coupon sites use merchant domains and brand names in urls to rank for seo terms. see: http://www.retailmenot.com/view/gap.com for example. Force coupon sites to generate traffic based on non-brand coupon searches which are more likely to be incremental. Also look for SEM bidding violations and be aggressive about denying payment (especially after the holidays). Consult your inhouse attorney before hand as there will likely be large amounts of dollars denied and retailmenot and coupons.com etc have their own inhouse attorneys.

    6) Pay only for email placements from coupon sites. Retailmenot for instance has a large email list that can generate new customer leads.

    7) create specific coupon pages in an attempt to out rank coupon sites for your brand + coupon terms. See subdomains coupons.target.com, coupons.walmart.com. Unless there is some black hat seo behind the scenes, a retailer should rank #1 for their brand terms if they have a coupon page. If you find black hat violations - e.g. link buying etc, be sure to report to Google/bing.

    Would love to hear ideas from others

  2. #2
    OPM and Moderator Chuck Hamrick's Avatar
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    Here's a few that we've come up with (would love to hear from others):
    Who is we, you didn't bother to do an introduction and no one knows who you are!

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  4. #3
    OPM and Moderator Chuck Hamrick's Avatar
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    In my experience most (90% +) of the traffic from sites like retailmenot, coupons.com etc is from customers who were already in the checkout process so they do little to improve sales and end up costing both margin and commisions.
    Coupon sites are not requiring you to include a coupon code box in your cart, competition is.

    All of your suggestions should be part of the program. Several years ago I welcomed as many coupon sites to my merchants due to the huge organic ranking it created. Google wiped out most incremental traffic so there is little value now unless the site is a traffic generator. Am am now narrowing down the list I work with to a cap of ten based on the 1:1 relationship. If the coupon site is responsive and quick to get our promotions listed, do not force clicks for non deals then i consider them a partner. They get (unscrappable) exclusive coupons and trademark permisssion for coupon, discount, promotion, voucher, etc.

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  6. #4
    Member chris7530's Avatar
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    It's worth testing to see what happens when the coupon box is removed. There's some academic work to suggest having the coupon box lowers conversion. I know I can't place a link in this forum (sorry about the one above) but if you're interested, search for the work of Mike Shor who is an economist at vanderbilt university.

  7. #5
    Member chris7530's Avatar
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    Quote Originally Posted by Chuck Hamrick View Post
    Coupon sites are not requiring you to include a coupon code box in your cart, competition is.

    All of your suggestions should be part of the program. Several years ago I welcomed as many coupon sites to my merchants due to the huge organic ranking it created. Google wiped out most incremental traffic so there is little value now unless the site is a traffic generator. Am am now narrowing down the list I work with to a cap of ten based on the 1:1 relationship. If the coupon site is responsive and quick to get our promotions listed, do not force clicks for non deals then i consider them a partner. They get (unscrappable) exclusive coupons and trademark permisssion for coupon, discount, promotion, voucher, etc.
    Most of the coupon sites I've seen use nofollow on the links back to the merchant so I wouldn't expect they would help with SEO - maybe it was different in the past (which I agree would be a good reason to use them).

    The trick is to not pay coupon sites for the conversions/traffic that originated from your other marketing channels. For example, from a retailer's perspective 90% of coupon affiliate sales follow a pattern like this: customer comes to retailer's site through SEO/SEM/Direct, starts to check out, sees coupon input box, opens tab, clicks on retailmenot, retailmenot displays coupon or site offer (not necessarily valid), customer comes back to site and checks out (after retailmenot sets their cookie). I don't see any reason to pay for this as I already paid for marketing behind SEM/SEO/Direct. In fact, I think it's risky to have a customer leave the checkout process because on all the coupon sites I've seen, they feature your competitors somewhere on the landing page.

    The 10% (or less) incremental traffic from coupon affiliates is probably due to getting on their email blasts, non brand traffic they bring in (e.g. they may rank in SEO for 'coupons for socks' type searches), and direct traffic from the coupon site's loyal customers (which I bet is very low because coupon users are typically not loyal).

  8. #6
    Member chris7530's Avatar
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    I do consulting and used to manage an in-house program for a large ecommerce site. I found it frustrating that the inhouse teams didn't get much support filtering out unproductive and black hat affiliates from cj and linkshare (obviously these companies have a vested interest in keeping your commision payouts high since they take a percent of them). I also found that it helps tremendously to get rid of the bad affiliates because they are also overwriting the affiliate cookies of your productive affiliates.

  9. #7
    OPM and Moderator Chuck Hamrick's Avatar
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    The 10% (or less) incremental traffic from coupon affiliates is probably due to getting on their email blasts, non brand traffic they bring in (e.g. they may rank in SEO for 'coupons for socks' type searches), and direct traffic from the coupon site's loyal customers (which I bet is very low because coupon users are typically not loyal).
    I talked to a network who did an internal study on the aforementioned couponer and expected to see only 20% new customers. They did this through attribution tracking. they found the opposite, 80% were new customer referrals. Its not an official study and they are not ready to disclose it.

    Go ahead and add the link Vanderbilt.

  10. #8
    ABW Ambassador JoyUnltd's Avatar
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    Price Discrimination through Online Couponing: Impact on Purchase Intention and Profitability. I think this is the paper being referred to. Interesting. However, that study was done in 2006. Since then, the technical savvy (at least with search) of your average internet user has risen considerably, which would necessarily change the formulas.
    Last edited by JoyUnltd; January 10th, 2014 at 09:05 PM. Reason: I rambled on incessantly and irrelevantly.
    Renée
    Pay no attention to that woman behind the curtain. -Wizardress of Oz

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  12. #9
    Member chris7530's Avatar
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    Yes, here are two I was referring to:

    http://www2.owen.vanderbilt.edu/mike.../EconPsych.pdf
    http://www2.owen.vanderbilt.edu/mike...bm_reprint.pdf

    Good summary in slide format:
    http://www2.owen.vanderbilt.edu/mike...o/eLabTalk.pdf

    Last side has a good synopsis, essentially if you show a coupon box and the customer doesn't already have one from the merchant (e.g. sent via email before the purchase session begins) your abandonment rate will increase. Merchants should test removing the coupon input box or, even better, only show the coupon input box when the customer has been specifically given a coupon ahead of time (note this is not how coupon affiliates like retailmenot operate and is a strong indictment of their entire business model).

    Conclusions from last slide:

    Online coupons may be driving customers away

    In an experiment, an additional 15% of customers
    abandon carts due to coupon code prompting

    Must rethink presentation of coupons

    Coupon delivery out of company control

    Self selection along tech-savvy lines

    Must rethink efficacy of couponing

  13. #10
    Member chris7530's Avatar
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    Quote Originally Posted by Chuck Hamrick View Post
    I talked to a network who did an internal study on the aforementioned couponer and expected to see only 20% new customers. They did this through attribution tracking. they found the opposite, 80% were new customer referrals. Its not an official study and they are not ready to disclose it.
    I would be interested in seeing this study if it's possible to publish (perhaps to do another critique of the findings). As I mentioned in one of the other coupon threads, new customers in isolation is not a good measure (since there's an underlying probability that both old and new customers will likely leave the checkout box and search for a coupon which may be very similar; so you would expect to see new customers searching for coupons). Attribution tracking is the way to go (as you mention) because it will show if the coupon site was the originator of the traffic.

  14. #11
    Member chris7530's Avatar
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    also, following up on my previous post...

    I would also guess that the retailmenot case study results vary significantly by the how well known the merchant is already. I would be surprised to see this result for any merchant in the IR500, unless they've removed the coupon box from their checkout process.

    Walmart does this, which ensures that they don't lose customers in the middle of the checkout process (which also means that the bulk of their traffic from retailmenot will be incremental). This is precisely why 'kohls coupons' has 5 times more search volume than 'walmart coupons' even though walmart is a significantly larger site. So, if retailmenot's study is based on walmart data, I would encourage other retailers to follow walmart's lead Also, if there's anyone from the Kohls affiliate team on this forum, please reach out and I'll walk you through how to do a deep dive into your coupon affiliate business (for free here on the forums so other merchants can see how it's done).

  15. #12
    Moderator leeann's Avatar
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    So once again there is an ABW discussion about manipulating the final click. That is a very dangerous territory to venture into my friends.
    leeann


    Shoppers determine what has value and they like coupons. Stop manipulating who set the cookie just because you do not like coupon and promotional sites.

  16. #13
    Member chris7530's Avatar
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    Quote Originally Posted by leeann View Post
    So once again there is an ABW discussion about manipulating the final click. That is a very dangerous territory to venture into my friends.
    I don't see 'manipulation', I just see that coupon sites are taking advantage of a shortcoming in reporting systems that often only show last click sales. Once merchants have better analytics or take the time to do a deep dive they will likely dramatically reduce the payouts to coupon affiliates.

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  18. #14
    Moderator leeann's Avatar
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    Quote Originally Posted by chris7530 View Post
    I don't see 'manipulation', I just see that coupon sites are taking advantage of a shortcoming in reporting systems that often only show last click sales. Once merchants have better analytics or take the time to do a deep dive they will likely dramatically reduce the payouts to coupon affiliates.
    Nope. They are doing what they do - running coupon sites because shoppers love coupons. And merchants sign them up or there wouldn't be any discussion about paying commissions. It's just now -- for some unknown and rather unbelievable reason -- merchants and other non-coupon sites or sites that RECOGNIZE that shoppers want the information and they do not take the time to include it on their site -- resent coupon sites that offer it and thus close the sale. So, instead of dropping the coupon site they'd rather just cheat them.
    leeann


    Shoppers determine what has value and they like coupons. Stop manipulating who set the cookie just because you do not like coupon and promotional sites.

  19. #15
    Moderator leeann's Avatar
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    A few years back Chuck Hamrick was associated with Retailmenot and according to him, he made a decent income w/ that association. But when people pointed out that they do not follow the rules and should be dropped -- guess what? That is exactly what he did. That is ethical behavior.

    Signing them up and then devising ways to cheat them out of commission is not ethical.
    leeann


    Shoppers determine what has value and they like coupons. Stop manipulating who set the cookie just because you do not like coupon and promotional sites.

  20. #16
    Member chris7530's Avatar
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    Quote Originally Posted by leeann View Post
    A few years back Chuck Hamrick was associated with Retailmenot and according to him, he made a decent income w/ that association. But when people pointed out that they do not follow the rules and should be dropped -- guess what? That is exactly what he did. That is ethical behavior.

    Signing them up and then devising ways to cheat them out of commission is not ethical.
    Agreed, I would be interested in what Chuck found.

    However, for many programs with auto-approve or for programs that are very large and difficult to monitor, there's nothing unethical about enforcing the TOS that an affiliate agreed to when they signed up. Big sites like retailmenot may account for $1m in commissions for some of the large brands so it's worth checking that they are abiding by what they agreed to when they signed up before paying their bill.

  21. #17
    OPM and Moderator Chuck Hamrick's Avatar
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    A few years back Chuck Hamrick was associated with Retailmenot and according to him, he made a decent income w/ that association. But when people pointed out that they do not follow the rules and should be dropped -- guess what? That is exactly what he did. That is ethical behavior.
    Thank you. I have been working on conversion increase, attribution and unscrappable coupons for six months. Prior three years I allowed every coupon site that applied to the program and issued 200+ exclusive coupons. A year later I find that 90% were even placed. Found that several big coupon affiliates would add the copy we sent via newsletter but use a standard link. We had inserted the code into the affiliate link which was private to the affiliate and it auto populated the cart for discount and Free Shipping. They had automated the link adding process and failed to use the coded link thus reducing their conversion. The code worked ala carte so they got credit. Even if the coupon code was written down and manually entered or posted social or via email we manually credited sale to the exclusive affiliate directly.

    The Cons were that we had over 100 couponers who didn't manage the merchant page, after two attempts to get expired codes removed, some a year old, we booted the affiliate and reported them to the network(s).

    Also found several who were using unauthorized discounts in PPC as we allow trademark +coupon, +discount, etc. Same thing, those that complied and responded were left and the rest banned. Did a follow up a week later and caught a few putting the fake discount back and booted them and reported.

    We only have a 5% discount and Free Shipping so this is easy to police. We do $$ based discounts (same percent discount) so there no conflict.

    Next project is to figure out a multi-attribution model and employ it. If a PPC affiliate introduces due to someone searching on a TV episode with advertising for my merchant then the consumer comes back due to an affiliate content article and finally a coupon closes the sale, all three should be rewarded with a portion of the joint commission. If two part of it then they both get a partition, if one then all. Its more complicated than that so will take some work by the network.

    Also looking at eliminating the coupon box for affiliate traffic and using a source referrer to add it to the cart triggering a success message. Can't remove the coupon box from the merchant site as the bulk of the sales come from direct marketing and they use their own codes for discount.

    I am also reducing coupon affiliates to a select few so I can better monitor and manage that. Only working with responsive affiliate partners.

  22. #18
    Member chris7530's Avatar
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    Thanks for sharing Chuck. Couple of follow-up questions:

    Quote Originally Posted by Chuck Hamrick View Post

    Also found several who were using unauthorized discounts in PPC as we allow trademark +coupon, +discount, etc.
    What do you see as the advantage to allowing affiliates to bid on the merchant's brand name?

    It's interesting to compare the two strategies: using the google results for 'kohls coupons' vs 'walmart coupons' I see about 11 affiliates in the paid/sem results for Kohls but only two results (one at top and other at the bottom) for walmart. What is interesting about these results is the walmart result doesn't show any affiliates (likely because of walmart's TOS) but does show two traffic arbitrage sites (ask and webcrawler). Walmart also has #1 seo rank but Kohls does not. Which site do you think is spending more $s on affiliate channels?

    Quote Originally Posted by Chuck Hamrick View Post

    Next project is to figure out a multi-attribution model and employ it. If a PPC affiliate introduces due to someone searching on a TV episode with advertising for my merchant then the consumer comes back due to an affiliate content article and finally a coupon closes the sale, all three should be rewarded with a portion of the joint commission. If two part of it then they both get a partition, if one then all. Its more complicated than that so will take some work by the network.
    Yes, this is a very valuable (and complicated) exercise and it's how we discovered the lack of incrementality for coupon sites. Another thing to keep in mind is that even if the coupon site was part of the extended purchasing session (say one that included 3 different marketing channels: SEO->Direct->coupon affiliate), if the coupon affiliate was the last one and the cookie was set while the customer was in the checkout process, you shouldn't give it the same credit (or any credit IMO). Only give coupon sites credit if they bring in traffic to pages outside the checkout process. If coupons are so essential to closing the deal, put them right in the checkout process like macys does so you can immediately close the deal.

  23. #19
    OPM and Moderator Chuck Hamrick's Avatar
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    Only give coupon sites credit if they bring in traffic to pages outside the checkout process. If coupons are so essential to closing the deal, put them right in the checkout process like macys does so you can immediately close the deal.
    That's going to be a hard sell unless you abolish all coupon codes on your site.

  24. #20
    Moderator leeann's Avatar
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    Quote Originally Posted by chris7530 View Post
    .. if the coupon affiliate was the last one and the cookie was set while the customer was in the checkout process, you shouldn't give it the same credit (or any credit IMO). Only give coupon sites credit if they bring in traffic to pages outside the checkout process. If coupons are so essential to closing the deal, put them right in the checkout process like macys does so you can immediately close the deal.
    chris - You asked earlier about the meaning of manipulating the final click. What you are saying here is an example of manipulating the final click. You (or anyone who does this) presumes to know what the final motivation was for a shopper to finally decide to make a purchase.

    No one can know what a shoppers final motivation was unless they are engaged in a dialogue with the person when they make the purchase. The concept that you/merchants/affiliate managers..etc.. can somehow get into the mind of shoppers is incredible and it is why paying commission to the site that set the final cookie makes the most sense.

    Also, I have to point out your glaring contradiction. You say, "if coupons are so essential in closing the sale...yadda yadda.." It's not an "if" situation. A large segment of online shoppers expect an online coupon and that is why they go looking for one. Want proof? We wouldn't be discussing it at ABW if it wasn't happening regularly. Yet you must find it really unessential since you think coupon sites should earn lower commissions. So what is it? Are coupons for some product categories essential or unessential?

    And, like I've said before, if one site loses the click to a shopper because they would rather rest on their evergreen laurels, then they deserve to lose the cookie. They have just as much opportunity to put an affiliate distributed coupon code on their site as does the coupon site. But they are too lazy to keep it updated so they would rather steal the commission from the coupon sites.

    Those who are in favor of this can talk all you want. You know it's wrong to do it. Every affiliate has access to pretty much the same promotional material. The promotional material is designed to attract customers, compete, or whatever... so when sites ignore it then grumble because a shopper went looking for it... then maybe it is time for them to change. The solution is not to rip-off or under-value commissions from the coupons sites that are affiliate approved and post approved coupons and promotional links.
    Last edited by leeann; January 15th, 2014 at 12:07 PM.
    leeann


    Shoppers determine what has value and they like coupons. Stop manipulating who set the cookie just because you do not like coupon and promotional sites.

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  26. #21
    ABW Ambassador kse's Avatar
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    Quote Originally Posted by leeann View Post
    ....

    And, like I've said before, if one site loses the click to a shopper because they would rather rest on their evergreen laurels, then they deserve to lose the cookie. They have just as much opportunity to put an affiliate distributed coupon code on their site as does the coupon site. But they are too lazy to keep it updated so they would rather steal the commission from the coupon sites.

    .........
    Yep that is it, original content sites are lazy and steeling commissions from coupon sites. Really??? Good try...

    So you never stated your option on Coupon sites that say "Click here for coupon code" and in turn open's the merchants site via affiliate link and may or may not show a coupon code after the person clicks the button/link to SEE the code??
    Last edited by kse; January 15th, 2014 at 01:07 PM.
    MERCHANTS: Start showing your coupons directly on your site, that way your shoppers will stop leaving your site looking for them!! If not then remove your Coupon Box!!

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  28. #22
    Member chris7530's Avatar
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    Quote Originally Posted by leeann View Post
    chris - You asked earlier about the meaning of manipulating the final click. What you are saying here is an example of manipulating the final click. You (or anyone who does this) presumes to know what the final motivation was for a shopper to finally decide to make a purchase.

    No one can know what a shoppers final motivation was unless they are engaged in a dialogue with the person when they make the purchase. The concept that you/merchants/affiliate managers..etc.. can somehow get into the mind of shoppers is incredible and it is why paying commission to the site that set the final cookie makes the most sense.

    Also, I have to point out your glaring contradiction. You say, "if coupons are so essential in closing the sale...yadda yadda.." It's not an "if" situation. A large segment of online shoppers expect an online coupon and that is why they go looking for one. Want proof? We wouldn't be discussing it at ABW if it wasn't happening regularly. Yet you must find it really unessential since you think coupon sites should earn lower commissions. So what is it? Are coupons for some product categories essential or unessential?

    And, like I've said before, if one site loses the click to a shopper because they would rather rest on their evergreen laurels, then they deserve to lose the cookie. They have just as much opportunity to put an affiliate distributed coupon code on their site as does the coupon site. But they are too lazy to keep it updated so they would rather steal the commission from the coupon sites.

    Those who are in favor of this can talk all you want. You know it's wrong to do it. Every affiliate has access to pretty much the same promotional material. The promotional material is designed to attract customers, compete, or whatever... so when sites ignore it then grumble because a shopper went looking for it... then maybe it is time for them to change. The solution is not to rip-off or under-value commissions from the coupons sites that are affiliate approved and post approved coupons and promotional links.
    Yes, I agree, would not be fair to a coupon affiliate to deny their commissions after the fact if they follow the TOS. However, I just wouldn't allow them in the program to begin with. I'm not against coupons, I can see how they might help. What Macy's is doing makes a lot of sense and I'm sure they're providing coupons to everyone who wouldn't buy without them, however macy's isn't paying affiliate commissions out to coupon sites nor are they risking customers not coming back into the checkout process after they go looking for them.

    Contrast this with payless shoes, which does not provide coupons on site and imagine how much more payless is paying for no extra customer benefit. Why do you think 'payless coupons' has more searches than 'macys coupons' even though macy's is a massively larger website? It's because Macy's is smart enough to keep coupon traffic on it's own site.

    I would imagine/hope coupon affiliates will eventually be viewed the same as toolbar affiliates and will slowly disappear into the seedy underbelly of affiliate marketing where they belong (somewhat kidding... ;-)

  29. #23
    What's the word? Rhia7's Avatar
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    Quote Originally Posted by chris7530 View Post
    I would imagine/hope coupon affiliates will eventually be viewed the same as toolbar affiliates and will slowly disappear into the seedy underbelly of affiliate marketing where they belong (somewhat kidding... ;-)
    No. Don't toolbar sites distribute code/mini programs/adware and/or create confusion as did the sites that used to incorporate frames? This would be different from a coupon site.

    I think a problem exists when a content site created desire for the
    purple widget but did not include a coupon code adjacent to the description
    and/or product picture/video for the purple widget and then the customer
    at the checkout is alerted to the possibility that such a coupon might exist so then the customer starts to search for the code. Or is there a chance that the customer might go on with the sale?

    There are times when the coupon code box does not apply to all items. Macy's was mentioned in this thread. Often there will be a store wide sale at Macy's with a code to type into a box at the checkout in order to lower the percentage of the sale but the code will exclude cosmetics (as an example).

    I don't equate coupon sites with toolbar sites.
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  31. #24
    ABW Ambassador
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    Quote Originally Posted by chris7530 View Post
    I would imagine/hope coupon affiliates will eventually be viewed the same as toolbar affiliates and will slowly disappear into the seedy underbelly of affiliate marketing where they belong (somewhat kidding... ;-)
    And this is why merchants should run from most "consultants". Maybe they should disappear too.

    As a side note, since what you did originally didn't work out and now you're wanting to become a consultant, I would use a more professional name on forums. Nicknames are something affiliates can get away with, since we're free, but I was searching on yours.

    And I know there are different chris7530 out there, but it's something your future employer might search on/have a problem with/confuse you with somebody else.
    Last edited by Chuck Hamrick; January 15th, 2014 at 10:41 PM. Reason: Edited direct link as its to a porn site.

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  33. #25
    Member chris7530's Avatar
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    Quote Originally Posted by Trust View Post
    And this is why merchants should run from most "consultants". Maybe they should disappear too.

    As a side note, since what you did originally didn't work out and now you're wanting to become a consultant, I would use a more professional name on forums. Nicknames are something affiliates can get away with, since we're free, but I was searching on yours

    And I know there are different chris7530 out there, but it's something your future employer might search on/have a problem with/confuse you with somebody else.
    linking to porn is crossing the line (and I'm guessing against the rules here) - let's try to have a constructive discussion without ad hominem attacks. can't believe you're a abestweb ambassador.
    Last edited by Chuck Hamrick; January 15th, 2014 at 10:42 PM. Reason: edited direct link as its to a porn site

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