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  1. #1
    Join Date
    January 18th, 2005
    Differentiating a New Merchant Program
    I am working with a new merchant to launch a new affiliate program in a crowded category. (The new merchant offers products within a relatively narrow niche in the category.)

    The main "differentiator" we have is that the merchant sells unique products that are NOT offered by any other merchants in the broader category. However, I'm not sure that this will be obvious to many potential affiliates.

    The problem, as I perceive it, is that the merchant cannot match the commission rate of its most famous competitors, because the competitors are selling commodity products with huge margins, while the new merchant
    - produces higher-quality products on a smaller scale,
    - converts a higher percentage of visitors to buyers
    - won't inflate prices to allow for high affiliate commission rate
    - won't create unattainable "tiers" to claim rates "up to XX%"

    I'd love to hear some advice from other merchants and from affiliates about how we might effectively "tell our story" to prospective affiliates, so that they understand how this new company is different from its competitors. We anticipate that most of our prospective affiliates will already have experience with several high-commission competitors.

    One idea I've had is to identify our strongest 50 or 100 affiliate prospects and "recruit" them by either (A) offering a free product of the webmaster's choice, or (B) sending a free product of our choice, unsolicited -- in order to demonstrate the higher quality. However, I'm not sure this would overcome pre-existing beliefs about conversion rates, which in turn makes our "percentage rate" seem low compared to the higher percentage rate offered by competitors.

    I am hopeful that our higher conversion rate will continue, and this should help push up our published EPC figures -- but I know some merchants' affiliate managers work actively to artificially manipulate their EPC figures, so I'm not confident about this.

    I'd like to hear any ideas about how we might differentiate our program from our competitors, in the eyes of our prospective affiliates.
    Last edited by markwelch; August 23rd, 2006 at 11:51 PM. Reason: Corrected typo.

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