Tuesday, November 13, 2007

Beef up Affiliate Programs

At the Warrillow & Co. conference today in Toronto, the research company released some interesting findings from their 2007 survey on marketing to Canadian small businesses.

This year’s conference entitled “Stealing Share” is dealing mainly with the topic of challenger businesses that are cropping up to service the Canadian small business sector. John Warrillow’s presentation this morning showed a number of examples of businesses using various media techniques to gain market share. “Small businesses have more choices than ever as a result of Internet and high speed penetration” said Warrillow to describe the highly competitive nature of effectively reaching the 2.3 million small business owners in Canada.

Some of the featured challenger businesses included Costco in the small business supplies area, ING in banking and Vonage in the telecommunications field. Across all challenger businesses, when the small businesses were polled on how they became aware of the new brands, online advertising came a close second (at 22%) to TV (at 26%).

One example that stood out from the rest was the TigerDirect.ca case study. TigerDirect.ca was singled out as a company that was using online affiliate programs effectively to not only heighten brand awareness but also to steal market share. Warrillow’s study showed that the average revenue share for an online affiliate program within the tech sector is between 1 and 2 percent. By contrast, TigerDirect.ca pays double and sometimes triple the industry average.

As a result, the affiliate program attracts a lot of attention, motivates partners to merchandise the links and does wonders for their SEO.

If budgets for affiliate programs could become more flexible in that they include some investment towards brand awareness, the thought of paying double or triple points starts to make a lot of sense.

More tomorrow…

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