This morning I received bad news from a merchant that my members (and I personally) love. The merchant was “streamlining” their program and decided to drop us. I checked our stats and saw that we had 34 sales in about 9 weeks. That’s not huge, but it is consistent. My first thought was that maybe they decided to drop incentive sites for ROI reasons. So I checked my “big dog” competitors and found that they were still there.
I know that our quality of sales is always good because we have been receiving that feedback from our merchants for 8 years. I also know that we are known for playing by all of the coupon rules and carefully monitoring for fraud. We try to promote merchants in unique ways to our loyal base and do not even get much coupon search traffic. We’ve received numerous awards over the years in all different categories from the consumer side and the industry side. But the bottom line is that we just aren’t big enough for a lot of merchants to want to work with us.
Why Do Merchants Drop Small Affiliates?
In talking to merchants, affiliate managers, and OPMs over the years, I’ve heard various reasons why merchants will not want to work with smaller affiliates. Some programs only want X number of affiliates and do not have the time or inclination to work with a bigger number. On the flip side, I hear affiliate managers saying that the more affiliates in the program the better…even if the affiliates are not sending a single sale.
Some merchants only want to work with big “brand” affiliates. So if you are an affiliate that does not have a big brand name, they do not want their brand associated with you. It’s more about image than anything else.
Sometimes it is only about the sales. The affiliate manager is looking purely at numbers. If you cannot sell at a certain level, it does not matter the quality of your sales or the reach of your audience. If you cannot stay at the level of sales that they want, they don’t have any use for you.
Benefits of Working with Smaller Affiliates
Despite all of those reasons, there are even better reasons that merchants should consider working with affiliates that don’t pull huge numbers.
First, smaller affiliates are usually cheaper to work with. They don’t usually charge any kind of placement fees and will often give preferred placement just for commission increases. What do you have to lose by offering them a higher commission for front page placement? If they don’t have enough traffic to sell anything, you are not paying them anything anyway.
Second, they are usually more agile. There isn’t much red tape in a company with only one employee. You don’t have to wait for the people in the graphics department and the newsletter department to approve things. Nothing needs signed by the VP of Advanced Placement to make a deal. You and the affiliate email back and forth a couple of times and you might get on their homepage by afternoon.
Third, the site might not have a huge reach, but it might reach people that you are not already reaching through the bigger sites. Not everyone reads the same blogs. You’d be surprised at the number of people who intentionally avoid big news sites and overly commercial sites. Affiliates of all sizes have a knack for creating audiences of loyal visitors.
Fourth, you have better control over your data when you allow a smaller affiliate into your program given their other alternatives. I work with a very big branded merchant that only pays 4% back to me, so I pay 3% back to my cash back members. I send them sales pretty much every single day. I saw that I could get 6-8% if I pulled their links through Viglink or Skimlinks instead. When I reached out to them and explained this to them, they told me to use those links then. I was floored! Here I was as an affiliate with proven sales who wanted to try to work directly with them where they would be able to track their ROI with me and they couldn’t be bothered to even discuss it. Affiliates have a lot of alternatives when it comes to sub-networks that make life REALLY easy for the affiliate. If the affiliate is willing to do the extra work to work with a merchant directly, the merchant should at least be willing to negotiate with the affiliate.
Fifth, affiliates talk. When you treat an affiliate right, word travels. Affiliates talk in private Facebook groups, public forum, and conferences. Affiliates of all sizes share stories and experiences. Working with one small affiliate may end up being what gets you great exposure to a lot of other quality affiliates. Conversely, an affiliate that has a bad experience when you drop them out of the blue is likely to share that information with other affiliates who are on the fence about working with you.
Lastly, you never know a site’s potential. Working with a big affiliate doesn’t guarantee that you will get sales, and working with a small affiliate doesn’t guarantee that you won’t get sales. Sites move up and down in rankings and visitors all the time based on Google’s whims, a lucky mention in the press, a viral blog post, etc. When you take the time to work with an affiliate and build up good will, you never know how that will boomerang to you in the future. I like to think that some of the affiliate managers who helped me out in the beginning have seen me pay them back over the years by promoting their up-and-coming programs, pushing sales that no one else would, and going the extra mile with creative promotions.
I know that not every program is a great fit for every site. Merchants have to make decisions based on ROI and the strength of their brand. And yet, I think too often they underestimate the value of a truly loyal partner as opposed to one that just has big numbers.
I’d love to hear your thoughts either as 1) a small-ish affiliate who deals with this same problem, 2) a merchant who has a different take, or even 3) a big affiliate who thinks I just eat too many sour grapes!