Credentials Presentation

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Why am I here?

• 2bn online advertising spend (2006 IAB)
• 2bn sales revenue generated through affiliates
  (2006 eConsultancy)

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Affiliate Marketing

• The Model - Pay-on-performance sales channel
• Publishers Affiliates
• Advertiser Merchant Client
• Tracking, Invoicing Payments
• ROI positive Risk free
• Stable and sustainable

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Affiliate Marketing concept
TradeDoubler pays publishers
Advertisers pay TradeDoubler
Publisher
Advertiser
Visitor
Visitor
The publisher is awarded commission
TradeDoubler tracking
Cash payments
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Affiliate Marketing

• Market Growth
• 65 last year 40 this year
• Second largest digital channel
• 2bn online ad spend in 2006
• Retail/entertainment/electrical
• Pioneers Amazon, ebay, Dell

• Networks Agencies
• 24 Affiliate networks in UK
• Agencies with dedicated affiliate teams
• Affiliate agencies
• Search and affiliates

The battle for the best affiliates will heat up
(in 2007). For this reason many companies' plans
for 2007 include working even more closely with
their affiliates and offering them better
commissions in order to retain them. (New Media
Age11.02.07)
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Affiliate Marketing

• Sustainability
• Continued growth
• Publisher maturity development
• Significant technology investments

• Maturity
• Board room buy-in
• Affiliate - 25 to 60 of online mix
• Consolidation
• Multi-metric

With budgets seemingly increasing across the
board and advertisers fostering ever-closer
relationships with their affiliate partners and
networks, the flow of money into affiliate
marketing in the UK shows no sign of
abating. (New Media Age11.02.07)
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Who are Affiliates?

• Website owner
• Dont actually sell anything themselves!
• Displays banners, text links or product feed
  results
• Comparison, Shopping, Information, reviews,
  search specialists, loyalty
• Kelkoo, Shopperuk.com, MoneySavingExpert, Nectar
  eStores
• Up to 50 employees
• Generate up to 100m sales revenue
• Work with up to 150 different advertisers

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Who are Advertisers?

• Merchant with products or services to sell online
• Desire to grow transactions
• Finance, Computing, Travel, Retail,
  Entertainment, Electrical
• Future sectors Automotive, FMCG

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The Big Networks

• TradeDoubler is the largest network with 1,191
  respondents (87) saying they are signed up to
  promote its UK merchants
• TradeDoubler was revealed as having an affiliate
  reach of over 60 higher than our nearest
  competitor

Source eConsultancys UK Affiliate Census
Report, January 2007
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Basic Building Blocks
Segmentation and incentivisation of publishers
Reporting interface - analyse conversions, produc
ts sold, etc
Clear strategy and resource allocation
Recruitment of publishers
Knowledge
Communication loyalty building
Timely payments
Integrated approach email marketing, key
words, etc
Creatives and linking methods
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Challenges
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General

• How much to invest?
• What contribution should it have?
• Buy-in throughout the merchant organisation -
  fundamental
• Resource up take it seriously
• Who should be managing, reporting, advising?
• Agency positioning and lack of expertise in
  agencies
• Associations and their power to push the tipping
  point
• Difficult to have 100 control. Will improve but
  it will never be 100. Market needs to know that
  and accommodate it (TV, Outdoor, Press etc)

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Merchant

• Sustainable growth?
• What investment and resource to commit
• Brand representation on affiliates pages
• Private network or public
• Affiliate sales cannibalising ones that merchants
  would get for free?
• De-duplication of sales universal tag??
• Search - trademark protection activity by
  affiliates
• Fraudulent transactions
• Loyalty sites Controversy or opportunity
• Competition from other merchants CPAs, new
  rewards, CR, aff exclusives
• Technology investment feeds, landing pages,
  voucher codes

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Affiliate

• Being treated fairly
• Valued for what they do other than just sales
  brand exposure
• Cookie deleting and blocking
• Are merchants doing their part? CR, sales funnel,
  usability, leakage
• Timely payments
• Long-term commitment (budget) from merchants
• Finding new ways to obtain traffic and new
  technology to maximise ROI

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Network

• Sourcing more and more traffic - focus on quality
  publishers and traffic
• Deploying the right resource in he right way
• Knowledge and understanding of merchants
  agencies
• Shared goals partnership, not buyer / supplier
• Rates being squeezed at expense of service and
  technology, its not a media buy, much more than
  that
• Technology investment development to meet
  requirements and be future-proof
• Cookie blocking G2, IP tracking
• Search tracking and monitoring
• AdWare
• Demand for pan-Group or pan-continent management
• Traffic, traffic, traffic! Focus on the
  publishers!

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• Questions?

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Appendix
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Calculating Earnings Per Click (EPC)

• Affiliates want a high EPC
• Conversion rate is critical in achieving this

Publisher Commission
EPC (earnings per click)

Unique visitors

• EPC is based on three factors
• 1. Commission - publisher incentive / bonuses
• 2. CTR - creative , brand and customer offer,
  landing pages
• 3. CR site conversion and sign up rates