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  1. #1
    Super Dawg Member Phil Kaufman aka AffiliateHound's Avatar
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    Walmart does it to us - new LOWER commissions
    A couple of days ago, this thread led to lots of speculation about what Walmart was planning.

    Well the shoe has dropped, with a bang. I just received an email from Walmart drastically reducing their commissions:

    Toys, Home, Garden, Baby, Sports, Tires, Apparel, Jewelry, Gifts and Optical - now 4%
    Electronics, Video Games, Movies, Music, Books, Photo - now 1%
    Since June 10, 2012 a vegan aarf but still writing the Hound Dawg Sports Blog
    "If you don't have time to do it right, when will you have time to do it over?" -John Wooden;
    "Raj, there’s no place for truth on the internet." -Howard Wolowitz[/SIZE]

  2. #2
    Affiliate Manager PetsWarehouse.com's Avatar
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    That's what I suspected
    Bob Pets Warehouse
    Worlds Largest Pet Supply DataBase
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  3. #3
    ABW Ambassador Snib's Avatar
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    Wow, this is unbelievable. 1% for electronics and 4% for apparel is simply absurd. Good thing they're going to be in Miami because I've got a word or two for them about this.

    - Scott
    Hatred stirs up strife, But love covers all transgressions.

  4. #4
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    This really hurts. I was the one that posted the e-mail in the thread that AffiliateHound linked.

    I never did too much with them during Q1-Q3, but the little bit I did still did well performance-wise. But the holidays were always huge with WM (Q406 I sold well over a million in product for them) and assuming this stays the same when Q4 rolls around, it's not going to be good.

    For anyone interested in how this compares, their current structure is:

    6% commission [Electronics]
    8% commission [Home, Optical, Photo, Sports, Tires, Toys, Books]
    12% commission [Apparel, Jewelry, Gifts]
    5% commission on everything else

  5. #5
    ABW Ambassador
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    No doubt some of our local ABW/SAS merchants will benefit from this.

  6. #6
    Super Dawg Member Phil Kaufman aka AffiliateHound's Avatar
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    Quote Originally Posted by webworker
    No doubt some of our local ABW/SAS merchants will benefit from this.
    I'm switching product links right now.
    Since June 10, 2012 a vegan aarf but still writing the Hound Dawg Sports Blog
    "If you don't have time to do it right, when will you have time to do it over?" -John Wooden;
    "Raj, there’s no place for truth on the internet." -Howard Wolowitz[/SIZE]

  7. #7
    ABW Ambassador Snib's Avatar
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    Quote Originally Posted by webworker
    No doubt some of our local ABW/SAS merchants will benefit from this.
    Unfortunately none have the brand recognition that Walmart has. I did read an article in Internet Retailer that said smaller merchants are on the rise though..

    - Scott
    Hatred stirs up strife, But love covers all transgressions.

  8. #8
    Super Dawg Member Phil Kaufman aka AffiliateHound's Avatar
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    Quote Originally Posted by Snib
    Unfortunately none have the brand recognition that Walmart has. I did read an article in Internet Retailer that said smaller merchants are on the rise though..

    - Scott
    I think more important that that is the fact that for almost any product that Walmart carries, you can find it available with other merchants, but never at as low a price.
    Since June 10, 2012 a vegan aarf but still writing the Hound Dawg Sports Blog
    "If you don't have time to do it right, when will you have time to do it over?" -John Wooden;
    "Raj, there’s no place for truth on the internet." -Howard Wolowitz[/SIZE]

  9. #9
    Merchant & ABW Ambassador
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    As scott mentioed,
    -recognition is big.
    -production selection is one of the largest out there. It was debated a long time ago on ABW. The other merchant that comes close is Target and they are on CJ. not sure how many SKUs do they have or their payout is like.

  10. #10
    Super Dawg Member Phil Kaufman aka AffiliateHound's Avatar
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    Most products at Target pay 7%, except for audio/video which pay 3%. Target recently moved from LS to Performics. There are a few threads on how they have royally screwed up that move. Two months later there are still no individual product links available.
    Since June 10, 2012 a vegan aarf but still writing the Hound Dawg Sports Blog
    "If you don't have time to do it right, when will you have time to do it over?" -John Wooden;
    "Raj, there’s no place for truth on the internet." -Howard Wolowitz[/SIZE]

  11. #11
    Merchant & ABW Ambassador
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    Personally, I think the two strategic sins are
    1) Moving from one network to another (unless it's a do or die scenario)
    2) Reducing commission by more than 25% (unless merchant is not breaking even)

    I am not a wal-mart affiliate nor am I working with them on a merchant-merchant so I wish them all the best

  12. #12
    ABW Ambassador
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    6% commission [Electronics]
    8% commission [Home, Optical, Photo, Sports, Tires, Toys, Books]
    12% commission [Apparel, Jewelry, Gifts]
    5% commission on everything else

    I did pretty good with them because those were good commissions. So I thought they might drop it a little but that was a big drop. Electronics 6% - 1%. You can get 4% at Amazon and you can make more on the rest too. So they'll be dropping to the bottom of my pages and never on the front.

  13. #13
    Resident Genius and Staunch Capitalist Leader's Avatar
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    Electronics, Video Games, Movies, Music, Books, Photo - now 1%
    ROFL
    That amounts to what, 7 cents commission for a paperback book, and 15 cents for a CD?

    Absurd! So what if they have "brand recognition." If you don't run them, and there's someone who'd actually only buy from them--you won't be able to buy an extra pretzel rod?! Can you even get a pretzel rod for 7c anymore?

    Switching your links to Amazon, heck, switching 'em to practically anyone, would mean enough more in commission to make up for it and then some.

  14. #14
    ABW Ambassador Snib's Avatar
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    Quote Originally Posted by Leader
    ROFL
    Switching your links to Amazon, heck, switching 'em to practically anyone, would mean enough more in commission to make up for it and then some.
    Unfortunately some of us already have Amazon, Target, Best Buy, Circuit City, etc. So removing Walmart would just offer fewer choices for consumers who want to compare Walmart to Target or Amazon. We've always used unbaised price sorts from cheapest to highest, but this is a great reason to come up with a bid based sort that puts Walmart near the bottom.

    - Scott
    Hatred stirs up strife, But love covers all transgressions.

  15. #15
    ABW Ambassador
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    bid based sort
    What's a bid based sort?

  16. #16
    Resident Genius and Staunch Capitalist Leader's Avatar
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    Quote Originally Posted by Snib
    Unfortunately some of us already have Amazon, Target, Best Buy, Circuit City, etc. So removing Walmart would just offer fewer choices for consumers who want to compare Walmart to Target or Amazon. We've always used unbaised price sorts from cheapest to highest, but this is a great reason to come up with a bid based sort that puts Walmart near the bottom.

    - Scott
    1) Yeah, exactly, that's the point! The traffic won't have the "choice" to go to that cheapskate merchant. At least, not from your site.

    It's like they say for plays and restaurants: The worst mention it can get, is if it gets no mention at all.

    Out of sight, out of mind... (customer, thinking) "Guess I'll pick Amazon. Hm, wasn't there usually another store here? Can't remember. Oh well." *clicks link to higher-commission merchant*

    2) Perhaps for the default sort, you could use a "rating system" that's only visible to (and changeable by) you? (IOW, the customer sees the results, but not what criteria you're using.) I'm thinking of how places like Amazon and TigerDirect always have a bunch of "featured items." Even if I search for something on Amazon, the featured items show up first in the results (if it's not an extremely specific search).

    Many merchants actually "feature" their duds, but in the above cases, the ratings on the items are usually good, and there's a decent amount of ratings.

    I figure these items are probably ranked by profit potential. But they can't just call that sort criteria "Our Most Profitable Things!!" so they go with "featured items," and leave it to the viewer to figure out the whys.

  17. #17
    Moderator MichaelColey's Avatar
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    This is really surprising. I've talked with all of the Wal-Mart people in person many times, and they get affiliate marketing more than any other big merchant out there (even if Randy is a shark when it comes to Texas Hold 'em!). This has to be coming from much higher up. We can only hope that they track the results of this change and that they change course once they see how bad of a decision it is. If Randy and Mike are at the LinkShare Symposium today, I'm certainly going to have a word with them. Surely they're doing everything possible to reverse these decisions.
    Michael Coley
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  18. #18
    Internet Cowboy
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    3 return days and commissions get cut to < half. Maybe they are introducing a sitewide, unexpiring 10% off coupon. Probably not.
    They have just decided that affiliates will still promote them at the lower rate so they lowered it. Those of you who do volume with them will get offers I am sure. I've never done more than a few thousand in sales with them in any given month, so they will remain, but be buried under the real merchants on my sites.
    They need a video of the little yellow guy who flies around slashing prices doing the same to affiliate commissions. It would not be nearly as cute then.

  19. #19
    Lite On The Do, Heavy On The Nuts Donuts's Avatar
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    They pay UPromise more than that to steal from them, suckers! eBates too.

    If you're an affiliate doing real value add selling for this merchant (promoting products), you're behaving like an idiot.

  20. #20
    Lite On The Do, Heavy On The Nuts Donuts's Avatar
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    I thought about it some more, if not the affiliate, someone's behaving like an idiot (Wal-Mart).

  21. #21
    Analytics Dude Kevin's Avatar
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    But the average affiliate can indeed make a wiser choice, Donuts. And some will.
    Kevin Webster
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  22. #22
    ABW Ambassador Snib's Avatar
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    Quote Originally Posted by webworker
    What's a bid based sort?
    This is basically what Shopping.com and Shopzilla do. Rather than sort the prices on a particular product page from the cheapest to the most expensive they have "sponsored" prices that show up first that don't necessarily have the lowest price. Merchants bid just like we bid on AdWords for placement in this default sort. But since I don't have a bidding system in place I'd come up with my own special way to sort based on the number of clicks and in this case potential profit.

    - Scott
    Hatred stirs up strife, But love covers all transgressions.

  23. #23
    Merchant & ABW Ambassador
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    Quote Originally Posted by MichaelColey
    This has to be coming from much higher up....Surely they're doing everything possible to reverse these decisions.
    I would think that this is the case. Hopefully the higher upper will see that this will have a negative impact on their biz and reverse it before Q4 (once they have enough data).

  24. #24
    Lite On The Do, Heavy On The Nuts Donuts's Avatar
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    I met Randy at Aff Summit, he seemed very sharp to me and ethical as well. He can't be thrilled with this, he solidly struck me as a value minded guy, perhaps he has the power to tier / raise where he sees a fit.

    Seeing the loyaltyware, I think that the folks there, other than Randy, are blinded by reported numbers and don't yet understand that reports don't tell the whole story.

    (thought bubble... future OPM...)

  25. #25
    ABW Ambassador
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    (thought bubble)

    Is that like a brian fart?
    <~~~~~~~~~~~~~~~~~~~runs

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