The more things change, the more they stay the same. Think back less than ten years, and you find a search space that’s dominated by Paid Search Publishers, driving traffic to merchant sites via bridge pages. Let’s call this the Old Bridge Page World (OBP World).

This practice was quickly squashed by Google in 2011. Their philosophy of giving users a high-quality online experience was clearly at odds with the extra step in the customer path.

After this, if you want to run traditional Paid Search as an affiliate, you have to land users directly on the merchant’s page or at the very least ensure your site had unique content. This immediately causes problems, leaving very few true Performance Paid Search Publishers in the space.

Fast forward eight years, and it seems that we have returned to a search space which is once again dominated by Paid Search Publishers. The laws of this new world have changed, however. I am of course talking about the introduction of Comparison Shopping Services (CSS) into the Google Shopping auction.

Whilst the world we find ourselves in seems new and foreign, there are still ways in which it is familiar. So, how does the OBP World stack up against the newer world of CSS?

How have we have come full circle?

I know that we are all well versed in the birth of CSS, but the context here is crucial. I will, however, keep it brief. Please feel free to recite along with me. 

Back in 2017, Google was fined £2.1 billion by the European Commission on anti-competition grounds for promoting its own shopping service and supposedly deranking others organically.  As an aside, I think this is odd – Google was still promoting the Merchants, not Google Shopping – but I digress. 

This ruling gave rise to our new world order, with Google deciding to launch the CSS program to counteract the judgment passed down by the EC. Despite the fact that these comparison shopping sites are still driving direct to merchants sites – and paying Google for the privilege of doing so – this was deemed an appropriate solution.

Regardless, this was not enough. Traditional CSS were slow on the uptake, so Google reached out to Agencies, invited them to create their own in exchange for cheaper CPCs. A controversial method, but it stands for now.

So how does this new world (figure 1.2) resemble the old one affiliates will remember well (figure 1.1)? 

What does this mean?

The quick-thinkers amongst you will have picked up on a potential problem that will persist from the old world: Google’s philosophy of high-quality user experience. The biggest outcome of this would be the imposition of stricter and stricter rules on CSS website quality. 

According to an analysis conducted by NMPi, the number of customers who actually click on the CSS button is as low as 2 in 1000, making bridge pages 99.8% less of a problem than during the OBP world. It’s likely, then, that Google will sweep this under the rug. Even so, Google is constantly updating its regulations, meaning that anyone using a CSS will have to ensure they dedicate enough resources to ensure compliance.   

Not only does the CSS programme get Google out of trouble with the European Commission, but it also gives them a chance to inflate competition. So even though they lost money in the short term, inflating competition lets Google line their pockets with some additional Euros, Pounds, Krona..you name it. 

I doubt that Google will rest on their laurels here, with a whole world outside of the EEA that aren’t on the programme. I suspect on the back of this, they are totting up the numbers and realising the increase in revenue that would come by introducing CSS globally; bringing in a new era of Worldwide CSS.

What does this mean for affiliates?

Let’s take a moment to crunch the numbers, shall we?

According to eMarketer, the US spends over $5 billion on affiliate advertising every year. For argument’s sake, let’s say that this is the same in the EEA. The EU is also estimated to spend $17.86 billion on Search in 2019, with 90% of this going to Google. A bit of quick math and that’s a total of $16.07 billion spent on Google Search this year. 

eMarketer also reports that 17.9% – that’s $2.87 billion – of this spend is from the Retail sector alone, with AdTheena suggesting that 76% – $2.12 billion – of this is on Google Shopping.

$2.12 billion potential spend for an industry of $5billion.

For the affiliate industry, the impact is clearly huge. 

But affiliates need to be careful

Before your eyes widen too much, let me issue a word of warning. While the door has been opened to a considerable new revenue source, CSS Publishers must make sure they are offering added value, otherwise more and more advertisers will choose to operate outside of the affiliate networks.  We saw this happen in the OBP world, where affiliates got a bad name by over-indexing on branded keywords – offering little value to the lower branches

To avoid repeating the same mistakes, CSS Publishers should ensure that they are offering coverage across all search term groups and products, in order to give clients value across all performance bands. You will also need to work closely with in-house teams to establish KPIs, and even target different areas than in-house teams. 

The key here will be transparency. This includes accurate reporting on performance metrics and where they’re coming from, as well as an open and regular dialogue with in-house teams to create a collaborative working relationship.

Challenges that come with this?

Fresh meat to performance paid search, may not consider the risks behind an upfront cost, but it can be problematic. There are a couple of things that you should keep in mind from your client’s perspective.

• Ensure that your CPA is reflective of the work put in, as running at base rates can very quickly become a futile activity for both parties. 
• Ensure you are factoring in cancellation rates to all your activity. If an advertiser is profitable but has a 30% cancellation/return rate this can turn a profitable campaign into one that is costly. 
• Ensure you are integrating with your clients tracking systems as well as across the network. You may think you are driving huge value for your client, but without deduping against any other activity, you won’t get an accurate picture of ROI. 

Oh and one more thing, Comparison Listing Ads (figure 2)?

The recent launch of Comparison Listing Ads (CLA) has opened up some inventory never before available, and only available to CSS. Presumably, in order to achieve the goal of driving more traffic to the CSS websites, appeasing the EC and the CSS, given that the current traffic to the site is still not a large percentage of the total clicks.

Whatever the reason, it has opened up a new traffic source for CSS, a new way to generate revenue, and this real estate is not available to Traditional Google Shopping Providers.

Traffic has considerably increased over recent weeks, opening up the same challenges seen above, with the additional challenge of tying conversions back to specific campaigns in Google Ads and Search Ads 360. The challenge presents itself due to this click in the customer journey, and the disconnect between the tracking between the three services (Google, CSS and Merchant). 

Crack this, and you will crack CLAs, and be the first to start driving value from this new exciting and strange ad format from Google. 

Conclusion

The tradeoff for having CSS is likely to be deemed worth it as a result of warding off the European Commission and inflating CPCs. Despite the traffic through the ‘by CSS’ click being as low as 2 in 1000, Google will still continue to push CSS to improve their UX as every customer counts. Once they are happy with the quality I suspect it will be rolled out further afield off the back of conclusive incremental revenue analysis. 

The doors have been opened for the affiliate industry to make the most of a new market with huge potential across the board! Including a brand new format, in CLA, which is a classic affiliate-style arbitrage opportunity on the SERP itself. Something unimaginable just a year ago!

It is important that we do not repeat the same mistakes of the past, and find ways to offer value to this rapidly expanding revenue source. This needs to be done through open dialogue and transparency with advertisers, all the while ensuring campaigns overcome challenges associated with upfront costs and disconnected attribution. 

The post Google CSS: The Opportunities and Challenges to Affiliates appeared first on PerformanceIN.

Everyone and their affiliate manager are looking to execute a customer-centric business strategy.

A customer-centric approach is one where your customers’ needs and requirements are put before everything else. This as it suggests means that the customer will ultimately be the one to benefit from its implementation.

But our journey to a customer-first model is impeded as a direct result of its absolute reliance on customer data and in turn its dependence on consumer trust. Perhaps, our customers are not aware that we rely on their personal data to provide them with the best experience possible. More likely, though, they don’t feel like the end justifies the means.

If you look at the events of the last year, governments, media and the general public alike hold the common opinion that, as the data controllers, we are not holding up our end of the bargain. 

If our final destination is to deliver customer-first marketing, we have a long road ahead of us. Especially, with every other headline seemingly related to mistrust in data handling, data breaches or mistrust in the Google/Facebook duopoly. Given the headlines, it is unsurprising that Deloitte found over 80% of people feel they have lost control over how their data is collected and used.

As a result, we can expect tighter regulations and more technology aimed at thwarting the use of customer data in the coming year, with the restrictions and blind spots only likely to bleed.

Even Rupert Murdoch has waded in on the debate, calling for Google to divide their business due to its “overwhelming market power”, specifically highlighting their power over advertisers and publishers. Whether he is aware of the irony of this statement, is yet to be clear. But the humour is not lost on me. 

It has been said that the affiliate marketing industry is immune to the data debate, as a result of the data-light nature of its solutions. But the traditional conversion funnel in which publishers and advertisers ultimate aim is to drive a sale has shifted to a conversion flywheel where customers are at the centre.

With brands no longer accepting any siloed mavericks we are going to have to work with brands to ensure we are part of their flywheel and offering benefits to others that we share the space with. 

Customer data is the common currency of all those that sit in the business functions. If this is the way we can tie all business units together, how can we ensure we are handling data in a responsible way? How do we build that trust back up?

Value exchange

Despite the increasing protectiveness of consumers over their data, a Deloitte study found that 79% of consumers would still be willing to part with data if given clear benefits from doing so. 

A value exchange can be as simple as asking the customer for their phone number so that they can receive click-and-collect notifications. Unfortunately, things are not that simple anymore. Companies will have to outline exactly what they will do with the data and stick to those promises, or trust will be irrevocably damaged.

As an advertiser or a publisher, your customers need peace of mind that their data will be secure.

Segmentation

As a paid media publisher we need to ensure that the advertisers we work with are confident that we have taken steps to give them data security so that they can hold up their end of the bargain with their customers. As publishers, this means handling their data without breaching their agreements with customers.

As such we need to give our brands an automated way to pass segmented anonymised data from their data management platforms straight into our marketing platforms without us ever touching it. Ultimately, giving them the peace of mind that we can utilise their data without compromising their values.

Once you have achieved trust through tech, you can go far more granular approach to your customer communication whilst not suffering from data fatigue. Your only limit being those that are imposed on you through the various platforms and ad formats. 

Whilst many platforms already provide us with demographic and geographic metrics, there is only so far you take this. Overlay this with sophisticated segmentation of behavioural, lifestyle, psychographic, preferences, loyalty and value; and you can supercharge your approach to customer-first marketing.

The key thing to remember is that not everyone will respond to your brand in the same way, and this segmentation will allow you to treat them differently. Different messages depending on where they are in the flywheel, and different publisher types depending on their preferences. 

Now your budgets go further; you have a competitive advantage and, most importantly, you are demonstrating better knowledge of your customer needs.

But this only represents a part of the customer cycle, you need to ensure that the results are fed back, benefiting all those involved.

Centralisation

As a business becomes more complex and takes on more and more partners, they have experienced a data sprawl. Lots of data, but no real control over where it is held or who is accessing it. 

There is no point in having your business factions and partners runoff in different directions, as learning consolidation and agility will never be realised. Ultimately, you will never have a complete picture of who your customer is or who they are becoming. 

The centralisation of all your data and analytics will enable you to see things you couldn’t before and as a result, outmanoeuvre those siloed businesses. The benefits of data centralisation are clear and will help any business grow:

Data security

A single access point for their data enables a view of exactly who has viewed the data and what they have done with it.

Data Integrity

Having all your data in one place will enable you to carry out verification and clean your data quicker. Although accurate recording will not be directly remedied, it should make inaccuracies easier to highlight. 

Reduced maintenance

Any changes will immediately proliferate throughout your company. As a result, your development teams can focus more of their time on the more creative elements of their job.

Increased agility

Being able to carry out analytics across the business, will enable sales, marketing, services and other partners to react to the same signals, faster and appropriately.

In order to drive incremental revenue growth, we must look towards our customer data, but in order to do so, we need to give our customers assurances that we are handling it appropriately.

Yes, data security is an increasingly hot topic, but it should not stop us from approaching our ultimate mission of achieving a customer first approach. Those that pull together customer trust and centralisation through the power of technology, will be the ones that prosper in an increasingly volatile environment.

Lastly, some key takeaways for your customer-centric strategy to flourish:

• Regain trust through the development of technology
• Ensure the pass back of performance into a centralised source, allowing the business to pivot to the signals 
• Includes at a bare minimum deduping your last click but ideally ensuring all activity is data-driven attribution

The post Why Affiliate Managers Should Adopt a Customer-Centric Flywheel Model appeared first on PerformanceIN.

It seems that every year is touted as the year of Artificial Intelligence (AI). Yet year after year we fail to see that claim come to fruition. Where is this inundation of smart technology in our day to day lives? Is this a classic example of hype and media attention getting the better of common sense?

The AI frenzy has certainly wormed its way to the core of digital advertising. A recent report crowned ‘artificial intelligence’ as the most over-hyped term in marketing (Resultsticks, 2018), despite stiff competition from the likes of ‘Big Data’, ‘Omnichannel’, ‘Real-time’ and ‘Personalization’. You must admit, that’s an impressive title to hold against the who’s who of buzzwords! As this honour suggests, what we hear mostly from marketers claiming to use AI is either mundane automation mimicking intelligence, or intelligence that lacks any commercial viability.

It is difficult to fully establish the state of play with Lyre Birds occupying the ecosystem giving a false sense of the extent of AI saturation, but we will try all the same.

So, what is AI?

Before we continue, let’s stop and get a few definitions straight. Automation is the use of software capable of doing tasks or processes automatically. It is not AI. Machine learning is also not the same thing as AI, even though nowadays these terms are often used interchangeably.

Traditionally, AI is the broad concept of machines being able to carry out tasks in a way that we would consider smart. Machine Learning Technology (MLT) is an application of AI whereby you give a machine access to data and allow it to learn for itself. This learning element is crucial and, for all intents and purposes, is the key to something possessing true intelligence.

Is it all hype?

I believe there are areas where the impact of AI goes beyond uncommercial hype.

Search has come a long way since the early days. With a combination of natural language processing and machine learning, search engines are grasping our intent in ways we could not have imagined 10 years ago. It is vital that marketers grasp and understand these changes as fast as possible.

Programmatic buying and selling of ad space has made a huge difference to the reach and targeting capabilities of online advertising, but under this definition, it is merely automation. However, the application of propensity models off the back of machine learning algorithms will revolutionise how you target ads at your most relevant customers. Predictive analytics is likely to be another pivotal area. The use case is simple, one would have machine learning technology applied to help predict the impact of an ad or placement before launch, saving time and resources from dead-end investment.

Imagine this scenario: a customer walks into a mall, and cameras instantaneously detect their fashion, sense their friends, even their facial cues and body language. This information is then pushed through MLT and compared with masses of data collected about consumers and their shopping tendencies. Your propensity models then indicate that this person is worth the media spend. Ads are then shown to this person as they walk through the mall: if they walk into your clients shop and buy the items you have so thoughtfully picked out for them, you are awarded the conversion. If not, then at least your AI will learn.

What do these examples have in common?

Data is all important!

Amassing enough reliable data to implement is going to be the biggest hurdle to widespread application, especially with the growing data restrictions.

It needs to be up to date, processes need to be in place to handle it, it cannot be siloed, and you need lots of it. You can have the most advanced machine learning algorithms but apply it to crap data sets, which plague our industry, and the output is worse than an old-fashioned human.

How do we need to influence change?

AI is expected to have a revolutionary impact on the advertising industry. However, it is going to need huge investment to get the computing power, software, developers, and algorithms in place to realise that potential.

For the most part, it won’t be the advertisers and agencies leading the charge from a tech point of view. But what should we be doing to prepare for this world?

The role of the Campaign Manager

One of the biggest impact areas for biddable media will be understanding and reacting to the AI advances. In terms of campaign management, this means remaining on top of industry developments, analysing how ads function in changing environments and understanding how this will influence media strategy.

The role of the Leaders

Without the direct technical knowledge, decision-makers will have to focus on balancing three variables: how potentially valuable the technology could be, how mature the technology is, and the ability of the organisation to tolerate and manage risk.

Traditionally when thinking of outsourcing, thoughts turn to cheap labour abroad. Going forward agencies will be outsourcing to intelligent platforms and services. Deciphering between those that will benefit your company’s top line and those that are being misappropriated will be the key in developing your tools.

Final thoughts

There is such huge potential for AI in our industry, however, it is abundantly clear that we have developed ‘technology hype syndrome’. We have all identified the huge part it must play without fully understanding the infrastructural shifts needed to realise widespread adoption. We have convinced ourselves that we are further along the road to intelligent machines than we really are. For agencies and advertisers without access to data powerhouses, adapting to shifts and tool selection are going to be the keys to revolution.

Darwin said that “It is not the strongest that survives, nor the most intelligent. It is the one most adaptable to change”. Seemingly there are still lessons to take from this phrase, almost 200 years on, in the competitive environment of advertising.

The post Will Biddable Media be Revolutionised by Artificial Intelligence? appeared first on PerformanceIN.