[Alan Hamilton]

Great discussion!

Alan: I think you're talking about a different model, where affiliates are either compensated once based on the lifetime value of a customer

Not really MC. The model I am referring to is based on the commission being paid at the same rate on all same customer sales, from sale # 1 forward. The commissioin does not drop after sale #1. Customer "x" places an order that was generated by the affiliate. At the time of sale, the affiliate ID is passed to us and internal tracking marries the customer data to the affiliaite ID. Phone tracking is included using a bold AFID (promo code etc) immediately under the toll free CS number.

In our individual scenario, there are items of information on a medical history that are specific to the individual, so moving or changing phone #'s, deleting cookies, replacing a computer etc does not void our ability to track the customer. As this particular program is run through SaS, indy does not apply. A customer ordering shoes, jewelry, clothing, car parts, etc or other non medical related products does not have to provide the same information that a person ordering medication must provide, so for non medical verticals I understand the "cookie" issue.

My curiosity here is not related to Ameritrust; it is related to two new aff programs that we will be bringing out in non medical related verticals, so I want to hear what the consensus is so I can use the input to structure the comp plan for the new programs. Thank you to everyone who has shared thoughts on this so far, and I hope more will chime in too.

[MichaelColey]

So, just to understand, how does the following work in your scenario, Alan?

1) What happens if an existing customer who wasn't originally referred by an affiliate clicks through an affiliate link and places another order? I'm assuming that the affiliate gets credit for the sale. Does that customer become that affiliate's "lifetime customer" at that point?

2) What happens if an existing customer who was originally referred by one affiliate clicks through a different affiliate's link and places another order? I'm assuming that the second affiliate gets credit for the sale. Does the customer remain a "lifetime customer" of the original affiliate?

Confusion over those things might have been what caused affiliates to be skeptical of this. I think it could certainly be appealing, depending on how those things work.

[Alan Hamilton]

MC wrote:

So, just to understand, how does the following work in your scenario, Alan?

1) What happens if an existing customer who wasn't originally referred by an affiliate clicks through an affiliate link and places another order? I'm assuming that the affiliate gets credit for the sale. Does that customer become that affiliate's "lifetime customer" at that point?

The customer belongs to the originating source

2) What happens if an existing customer who was originally referred by one affiliate clicks through a different affiliate's link and places another order? I'm assuming that the second affiliate gets credit for the sale. Does the customer remain a "lifetime customer" of the original affiliate?

If the new customer was generated by an affiliate, future orders placed by that customer are credited to the affiliate who originally generated the new customer. Otherwise, it would defeat the purpose / appeal of giving the "original referring" affiliate a lifetime customer. Is it possible that a customer who originally came to us through one affiliates link could conceivably click through another affiliate's link and place an order? Yes, it is conceivable, but that would be an extremely rare circumstance. In fact, it would be hundreds of times less likely than a 30, 60, 180 day "cookie" expiring or being deleted by / from a customers computer

Confusion over those things might have been what caused affiliates to be skeptical of this. I think it could certainly be appealing, depending on how those things work.

I hear ya. My belief has always been that a major incentive to generate new customers is that whoever generates the new revenue source gets an ongoing reward. Is it a perfect system? No, nothing is perfect. Can a "what if" apply? Sure. That applies whether it's a cookie duration issue, or a lifetime customer approach. Everything in life and business is a tradeoff. The tradeoff here being that all things considered, and keeping the "what if this happens" scenarios in true perspective, it potentially rewards affiliates far better than a program that is solely reliant on cookies. That aside, I cannot recall any of my affiliates objecting to recurring commissions they are paid.

But again, my focus here is not on our current Ameritrust model. That model has worked great for those who are with us, so I have no plan to fix what "ain't" broke. But AmeriTrustrx is not shoes, clothing, or the typical mainstream products. My curiousity is for the new "mainstream" programs we will be bringing out, and determining the direction to take for those programs. If, for whatever reason, affiliates prefer cookies, I am fine with it. Just want to hone in on it a bit more clearly.

__________________

[MichaelColey]

It might be very rare for you, but for someone like Amazon or eBay, I'm sure it's not rare for a single customer to have orders through half a dozen or more distinct affiliates in a lifetime.

So what happens in your program if a customer's first order was through a non-affiliate source, then some subsequent order was through an affiliate? I'm still not clear on that (although I think you tried to answer it)?

[Alan Hamilton]

It might be very rare for you, but for someone like Amazon or eBay, I'm sure it's not rare for a single customer to have orders through half a dozen or more distinct affiliates in a lifetime.

So what happens in your program if a customer's first order was through a non-affiliate source, then some subsequent order was through an affiliate? I'm still not clear on that (although I think you tried to answer it)?

I appreciate your comments regarding Amazon, eBay etc. In fact, to a large extent, I think that therein lies the difference. The discussion in this thread is from a point of reference dealing with mainstream consumer goods, which can be offered through an unlimited number of channels.

AmeritrustRx products are not offered on eBay, Amazon or the other huge channels like them. Prescription medications represent a much different product mix than typical mainstream products such as books, shoes, clothing, t.v.'s, jewelry and other traditional consumer goods. They also represent an order and review process that differs from traditional consumer sales, including information provided by the customer that makes it possible to marry the customer and AFID. What applies to a lifetime customer model for AmeriTrust may not apply to most mainstream consumer goods programs.

Amazon, eBay or other huge consumer product channels deal with a different product set, different purchase process, and of course on an immensely larger scale through humongous networks of affiliates. So the likelihood of multiple affiliate link clickthroughs for them is far far greater than our product line. Also keep in mind that we contact every customer when a refill is approaching, and that (too) limits the eventuality of what you reference.

This is partially why I said that to my sense of logic, a cookie (regardless of length) expiring or being deleted by the user is countless times more likely to happen than an existing Ameritrust customer clicking through from a different affiliate link. Also, keep in mind that because an online prescribing pharmacy cannot be ppc'd through the big 3 as of yet, no ppc expense is involved, and as a result, affiliate generated orders are most typically the result of organic traffic generated by the affiliate to their own sites. We also receive orders as a result of our own SEO efforts, and the same model applies.

I don't really think a merchant can represent a customer as a "lifetime" customer if they do not have certain customer information that makes it possible to track customer identity through more than cookies or customer address / phone / IP etc. Nor do I think that a customer can be referred to as a "lifetime" customer if you are not crediting future sales to the source that originated the customer. The tradeoff is that the same protection I give an affiliate to future customer purchases for new customers s/he generates applies to other affiliates as well. So if an affiliate creates 100 new customers, s/he gets the ongoing commissions for those 100. Likwise, in the rare circumstance that an affiliate may inadvertently get a visitor who previously purchased from another affiliate link, that affiliate is protected by the same principal.

That said, again I am not exploring the AmeriTrustRx compensation model as it has been working fine and our affiliates have been happy with it. Rather my participation in this thread is because I am thinking through the direction that we will take with the mainstream consumer goods programs that we will be announcing in the near future. Those will likely be on a different model, and so I am most interested in opinions about cookies.




.

[MattMcWilliams]

The follow-up email will help increase conversions, too. Many merchants do that, but some do so with a "worst practice" of having newsletter links overwrite affiliate cookies. Specifically coding the newsletter to use the referring affiliate's ID is definitely a "best practice". It would also solve the problem where a customer might click through the link at work, sign up for a newsletter, then open the newsletter at home and place an order.

It DOES make sense for merchants to track the newsletter hits of course.

So, what we are testing are ways to still track the newsletter/thank you email leads AND give the affiliate ID.

The way we do this so far (and it seems to work) is assign a private campaign code to the affiliate link, so in the thank you email it reads:

affid=1111&camp=home_thanks_mm_dd_yy

OR

affid=1111&camp=home_thanks_leadID

This way we can run reports and see how many leads we get from the thank you emails but still give lead credits to affiliates.

Once we finish testing we will even release this to the affiliate so they can see how many leads we get them for free :approval:

[Kevin]

I still wonder though, in a lifetime cookie, or customer ownership scenario, how do we fairly and effectively pay the 2nd, 3rd, 4th etc affiliates that drive the same customers to our cart?

The argument could be made that the merchant is failing to keep their customers coming back directly. And I partly agree with this.

But some affiliate click throughs (think big brands like Amazon and eBay) are based on impulse... "Oh, that's right, I wanted to order that book.", and then they do so when they see an Amazon banner somewhere.

For sure, the affiliate in the above example needs to be paid, but does it warrant changing the lifetime portion?

[John Powell]

This accounts for those people that may delete cookies on browser close (a lot more than I thought), or delete them and read the email 2 days later etc.
My hope is that the networks are doing research on tracking without cookies.

I had a trial of Panda Antivirus and after scan it had found around 275 cookies that it dumped under the "Virus" lable.

Cookies are becoming more and more of a crap shoot and every time a cookie is crumbled the merchant wins, at least in the short term.

[cbsturg]

I honestly don't know if a "lifetime" customer compensation plan can work very well with affiliates marketing traditional goods (as opposed to Ameritrust's model). MC brought up the compensation plan of insurance companies, but there's a fundamental difference between what an affiliate does and what an insurance agent does.

My agent continues to be my source of contact to the insurance company. I just bought a new car last week, and I didn't call Allstate directly to update my policy - I called my agent.

Marrying affiliate information to a consumer's profile is fine and well, but I don't think it adequately addresses the problem of a particular user then following a different affiliate's link in the future. Surely you must award the last affiliate who drove the sale the appropriate commission. Do you overwrite the affiliate "owner" of this consumer as well?

Now, if you're selling a renewable service (e.g., web hosting) this problem can mainly be avoided. If a person renews the service, the original affiliate can be awarded a renewal commission (like my insurance agent). If the person does not renew but comes back later, the owner of the consumer is changed appropriately (if I cancel my policy and then purchase from Allstate from a different agent, the new agent is awarded the lifetime renewable commission).

But for traditional goods (like those sold on Amazon), I do not see a fair way to assign a lifetime ownership. The fairest way that I can see is to have a lifetime cookie, which, like all affiliate cookies, can be overwritten by a new affiliate's marketing efforts.

[Kevin]

Now, if you're selling a renewable service (e.g., web hosting) this problem can mainly be avoided. If a person renews the service, the original affiliate can be awarded a renewal commission (like my insurance agent). If the person does not renew but comes back later, the owner of the consumer is changed appropriately (if I cancel my policy and then purchase from Allstate from a different agent, the new agent is awarded the lifetime renewable commission).

But for traditional goods (like those sold on Amazon), I do not see a fair way to assign a lifetime ownership. The fairest way that I can see is to have a lifetime cookie, which, like all affiliate cookies, can be overwritten by a new affiliate's marketing efforts.

So in the end, the answer may be that the rights of affiliates are similar to the rights of merchants. The customer is YOURS!..... until you lose them :)

[cbsturg]

So in the end, the answer may be that the rights of affiliates are similar to the rights of merchants. The customer is YOURS!..... until you lose them :)
Well said! :thumbup2:

[lookingfortips]

I'm glad I found this post! I've been looking for something like this so I wouldn't have to start a new one.

Question: I set my cookies to never expire and to allow repeat commissions. Whether or not the customer decides to wait a week from now to make a purchase or if they make 100 purchases over the span of a year, the affiliate will get a commission from all of those sales.

But here is where it could get messy: What happens if a customer has possibly visited my store through multiple affiliate links? Does only the first or latest affiliate get the commission? Or everyone who ever referred that customer to my website?

I want to be generous but I don't want to go bankrupt! :p

[rematt]

The last affiliate site visited will overwrite any previous cookie on the users system unless your program is on multiple networks and the user has cookies set by the different networks.

-rematt

[lookingfortips]

The last affiliate site visited will overwrite any previous cookie on the users system unless your program is on multiple networks and the user has cookies set by the different networks.

-rematt

Thank you very much for your speedy reply as always, Rematt. :)

[Billy Kay]

A customer who makes 100 purchases in a year??? Name please :)

If he originally came from my site... I'd get the commish

Assuming they don't delete cookies... I'd keep getting commish

If, on th 99th time they went to rematt's site and clicked thru to you... from that day forward, he gets all the commish

[lookingfortips]

A customer who makes 100 purchases in a year??? Name Please :)

Good ol' dependable and supportive Mom? :p

(teasing...) But I was kind of being silly. I think the actual maximum for repeat purchases from one customer so far is probably 10- a big difference from 100! Sorry, wasn't trying to be misleading. I just picked that number out of thin air to make a point about how much I could end up spending in commission if it was possible multiple referrals were counted.

If he originally came from my site... I'd get the commish

Assuming they don't delete cookies... I'd keep getting commish

If, on th 99th time they went to rematt's site and clicked thru to you... from that day forward, he gets all the commish

That clarifies it. Thanks!

[shoelover]

i'll ask the obviously dumb question, like i seem to do lately, are there any drawbacks to non-expiring cookies?

[rematt]

Not from my perspective.

-rematt

[Geno Prussakov]

i'll ask the obviously dumb question, like i seem to do lately, are there any drawbacks to non-expiring cookies?
No. Affiliates love 'em. Merchants may end up paying commission on sales that occur 300 days past the original click (which won't be frequent I assure you), but why not?

Geno

[shoelover]

more stupidity........why would anyone offer anything less?

[shoelover]

my biggest issue should be paying someone a commission that much later......

[lookingfortips]

more stupidity........why would anyone offer anything less?

My guess (and it is just a guess) is that not all networks offer "eternal" cookies. The network I am with just happened to offer that feature as well as repeat commissions so I opted for it.

Does anyone know if SAS offers "eternal" cookies?

my biggest issue should be paying someone a commission that much later......

Look at it this way, though. If you are a small Mom & Pop operation (like me) that internet customers would never have heard of if it wasn't for your affiliates, then repeat commission would be worth it.

You can offer repeat commissions and draw more affiliates to promote you.

In my opinion, by offering an affiliate commission in the first place means you are willing to pay that percentage and that you can afford that percentage.

Remember, whatever future sales that referred customer makes is due to that affiliate. So why not reward them repeatedly?

If you're a well known company like Target, though, I wouldn't recommend it to the merchant. But for small family owned businesses just starting an ad campaign on the net- I feel it is worth it.

[MichaelColey]

Many merchants who offer longer cookies feel the need to lower commissions to justify the longer cookies. If that's the case, I would prefer higher commissions with a reasonably long cookie. Depending on the type of merchant, the buying cycle length, and the price of their products, somewhere from 14-45 days is usually enough. More than that is great, but not absolutely necessary.

More popular merchants with extensive non-affiliate promotion will find longer cookies hard to justify. For instance, consider Amazon.com or Overstock.com. How many of you here purchase several times a year from them? If they offered a 365 day cookie, you would often get paid for several orders (which you program had no real part in generating) over the course of a year for some customers. For stores like that, I think the low end of the scale (7-30 days) works fine.

[Howard Gottlieb]

I am assuming that a lifetime cookie is only a lifetime cookie if it is not overwritten by a cookie generated by a visit through a different affiliate? If that's true calling it a lifetime cookie is not really accurate.

Personally I would still love to see a way that a cookie can not be overwritten for a minimum of 30 minutes. In my circumstance I am more concerned with parasites and a couple of other situations that might allow for my cookie being overwritten while still on the merchant site.

[MichaelColey]

That's an argument for another thread, but the basic argument against that is that parasites will just change their behavior to try to get both the first and last click if a change like that became widespread. It would also encourage low quality clicks (especially from search results), because if you can lock in your 30 minute click first you're in good shape even if it's another affiliate that gives the customer what they want.