October 30, 2007
Coupon Affiliates Under Scrutiny
Kellie Stephens at AffiliateFairPlay has published a study on the use of forced clicks on affiliate coupon websites.
Forced Clicks
The definition of “forced click” varies a bit, but for this study is any affiliate tracking click that was initiated without any use action whatsoever when visiting a coupon site. No gray areas there.
Discussions have been happening recently at the ShareASale client conference a few weeks ago along with continuing discussions at ABestWeb. I’m glad to see Kellie tackling this with a no frills study that sets a baseline on what’s really going on. Too often we have these discussions without having any insight into statistics on what’s happening, and whether it is a big problem or a small one.
You can read the full details at AFP, but the results are as follows:
We found the incident of forced clicks to range from 0.8% - 4.4% on coupon sites. We found the incident of what could be considered a deceptive link on the merchant specific page listing the coupons to be slightly higher at 6.6%.
The detail of these numbers show that of 245 tests on Google search results, there were 2 incidents of forced clicks. On 180 tests on Google PPC ads, 3 forced clicks. And on 91 tests of direct navigation through affiliate sites, there were 6 incidents.
Since Kellie didn’t publish this on a blog entry, I can’t ask questions. I’ll ask them out loud here knowing that she’ll be by at some point.
Of those 2, 3, and 6 sites with forced clicks, what’s the unique number of affiliate sites? Were they the same sites with a total of 6 unique sites?
And if not, did some of the sites behave differently depending on the source of the traffic?
Deceptive Clicks
Kellie also covers the more gray area of deceptive clicks, meaning links that beg for a click to see a coupon code or close a pop-up but end up clicking over to a merchant site through an affiliate link.
The study demonstrates an increase in this practice, which makes sense given that affiliate networks have presumably been cracking down on forced clicks.
So many questions
As the coupon affiliates will point out, this practice is not limited to coupon websites. It is a way, however, to capture sales that they will argue they deserve when consumers come by hunting for coupon codes and find them on their website.
Forced clicks or not, this also raises another question about conflict between affiliates who have primed the pump, so to speak, with a product review only to lose that buyer in the shopping cart as the buyer goes off hunting for a coupon code.
Who deserves credit for the sale in that case?
One merchant at the SAS conference shared with me that through their own tracking they have determined that as much as 10% of sales are snatched up in the last few minutes of the buying process by a coupon affiliate.
Regardless of whether another affiliate was involved on the front-side of that referral, does the coupon affiliate deserve all or even some of this sale?
Many blame the merchant for driving this consumer behavior by placing a coupon field in the checkout process, prompting the consumer to make a last ditch effort to go off and save a few bucks. Even if there are no actual coupons to be found, the merchant is handing this sale to one of many affiliates who may be found on the search term, “merchant-name coupons”.
I’d bet my house that a big empty coupon code field in a checkout process is a bigger leak than any 800 number and cross-promotional links to other merchant properties combined.
Update: I missed it earlier, but Kellie did make a blog post to accompany this study, in which she presents the AFP position on what designates a commissionable action.
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As far as the coupon code fields at checkout..that is definately one of the things I look for when evaluating whether or not to promote a particular merchant. Coupon codes definately fall in the negative column for me.
I think just having the coupon box there gives the potential buyer the feeling that they are paying a premium for their items.
Hey Scott,
I think this is some good follow up questions to what’s already being discussed in ABW and at thinktank. Out of curiosity, when you spoke to the merchant and they mentioned that:
“as much as 10% of sales are snatched up in the last few minutes of the buying process by a coupon affiliate”
Did they mention to you how many sales were attributed by a couponer? I wonder if the traffic they are getting from a couponer is off-setting the 10% dilemma he/she described above.
Thanks
“Of those 2, 3, and 6 sites with forced clicks, what’s the unique number of affiliate sites? Were they the same sites with a total of 6 unique sites?”
It was 2, 3 and 4 for forced clicks. The 6 was deceptive linking. There was a total of four uniques sites found to be using forced clicks. But yes, some of sites accounted for more than one of the postive tests.
What is more interesting is that some of the sites which tested postive also tested negative on a separate test. Which leads to your second question….
“And if not, did some of the sites behave differently depending on the source of the traffic?”
That is somewhat difficult to say without testing every merchant each affiliate promotes. An affiliate may not use forced clicks across all their merchants. This could be due to traffic source, Network involved, merchant involved, mucked up site programming, lunar cycle, etc etc etc.
There was one site using deceptive links which controlled the behavior via cookies. Once cookied it wouldn’t happen again.
“I’d bet my house that a big empty coupon code field in a checkout process is a bigger leak than any 800 number and cross-promotional links to other merchant properties combined.”
Excellent point and I completely agree. I only became a couponer after getting tired of sending truckloads of completely incremental traffic to merchants and seeing couponers win most every contest for “sales”. So now that I’m an affiliate benefitting from the “leak”, you’d think I’d feel differently about it, but I don’t. As merchants become more adept at discerning value, couponing affiliates will suffer through channel separation, lower payout rates and ever rising competition. Since I’m a incremental guy who added couponing to my quiver, I’m chilling. If you’re just a couponer, I’d say now is the time to diversify. Incremental selling is so much more rewarding and stable, as a long term business plan.
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“is a bigger leak than any 800 number”
hey, maybe you’re on to something here… is there a way we affiliates can monetize phone traffic… “800″ could be the new “coupon”… and we “800″ affiliates can claim the prizes for all the phone calls we’re sending to our merchants…
I have a relatively new and small coupon site and its quite notable that the time between referal and sale is often very short, suggesting a last minute “hunt” for coupons. The market I am in is certainly not as advanced as in the UK or US but coupons and cashback sites certainly pluck cash from traditional affiliates in my opinion!
Scott, Another train of thought that went through the ShareASale Think Tank was the idea of a “shared” commission. If the content site wrote a review and the consumer didn’t buy, but later bought with a coupon code affiliate (or was driven to look for a coupon code as the examples discussed above)… shouldn’t the content site receive part of the commission.
Now I am sure there are ways to track this, technically speaking, but you are then asking the affiliate network, the merchant and the affiliates to agree to a whole new set of rules and parameters as to what drives consumer behavior.
A back of the house suggestion made during the Think Tank, and overheard be me, might be for content sites to take a few extra minutes to grab the coupon codes from the sites they are writing about and provide added value to the visitor/consumer that way. As automated as the tools are getting to add relevant coupon codes to sites, this should be relatively easy to do.
I agree Durk, trying to lay down “sharing” rules would be very, very difficult if not impossible.
Technically, it’s very possible. The networks have the data. Though it would be no small task to build in the features. And to do that only to have it fall on it’s face because the practice is too difficult would be tragic.
It may have back of the house, but I heard that loud and clear all around the table.
Essentially, the suggestion is to turn all affiliates into “coupon” affiliates. Someone made the very shallow statement, “don’t be so lazy. Post some coupons”.
Personally, I think that’s a bad solution. Why hand out a discount to every single customer that comes through when most are perfectly happy to purchase without one?
The only reason they go hunting is that they feel like they’re missing out because they see the big coupon field there.
For that matter, the merchant could pre-populate the coupon field if it came through an affiliate link.
Sounds absurd, but that’s my point. So is the argument that all affiliates should push coupons.
What really needs to happen is what this discussion always comes back to… the merchants need to get rid of that coupon/promo field and find another way to allow the coupon-loving consumers to use them.
Since I manage a number of programs I get lots of feedback from all sides- affiliates and merchants. At CJU 2006, CJ admitted that 60-70% of all sales were being generated by PPC affiliates. And, I know a lot of them didn’t worry about coupon codes, so the sales were pretty straight up (a whole other line of discussion).
This year across all of my programs I have seen a huge surge/success in coupon sites. I would say that couponers have gone from 20% of sales volumes to 30% and higher of my sales volumes. PPC affiliates are still extremely important, but couponing has really gained marketshare. Hence I am giving them much more attention.
I have not seen a corresponding surge in content sites.
Going along with all of this is I am hearing lots of squawks from my merchants that their Google campaigns are not converting as well as in the past. I am getting more emphasis on what I am doing and contributing to the online success of my merchants than ever before as they try to “replace” sales being lost in their PPC campaigns.
So a question.
1. Have other merchants been complaining about Google conversion rates going down recently? (I have one PPC affiliate that won’t use Google analytics in some verticals because he thinks they can control the quality of the traffic that gets sent to his sites and conversions as a result.)
2. Have PPC affiliate conversions gone down lately?
We know we get invalid clicks from our competitors trying to cost us money. All we can do is put our faith in google and hope that they credit our account back.
They do credit it back too. I always see small charge backs on our account, so atleast I know they are doing something about it.
I agree in general that invalid clicks increase the cost of advertisers, but in the present scenario one has to accept it also and to assess the overall profit or loss after including the room for invalid clicks also. In case it was possible to eliminate invalid clicks totally, Google would have done it by now. But they are doing it to the best possible. For Advertisers, if they still benefit in totality, they should not be worried enough unless the things turn out totally against them.
For our affiliate program, we don’t even allow coupon code affiliates. While it’s definitely tough to keep them out (and we’re constantly finding some that slip through), we feel like the bad aspects of using them far outweighs the benefits. In general, if someone is searching for the company name + coupon codes or promotional codes, they’re already completely brand aware. The sale would likely go through whether they searched or not.
Since we don’t even release coupon codes for our affiliates, it’s even worse - they just take our standard free shipping over $X and get people to click through to our site.
While I think losing 10% of customers who go off in search of a coupon code is definitely reasonable (if they wanted that customer, they should offer a few coupon codes), the forced clicks aren’t - just dirty play really.
There is no software with capability at the moment to fix invalid clicks. Google is always trying to improve there advertising base for their clients and I am sure this is at the top of their list. They try to fix this with credit backs at the moment but I am sure in the near future you will see further advancements in this area and click fraud in general. My conversion rates have stayed roughly the same for the past few months so I have not seen the decrease mentioned. Steven
This is similar to the affiliate link hijacking that adware publishers undertake. Only that they are also directly siphoning off valid sales from honest affiliates.
Some industries only issue coupon codes to super affiliates.
As someone who runs a number of Comparison websites I feel that the main issue for me is merchants that bid on their own brand term & purposely overwrite the Affiliate Cookie after we’ve done all the hard work.
This is especially prevaliant with Search Marketing companies outsourced to increase PPC revenues & they rely heavily on the brand term to bump up their figures.
I’m surprised this isn’t more widespread. I’ve seen software working that you can install on your website to secretly “click” a url without the users knowledge.
Basically it just opens up an invisible iFrame in the background somewhere and navigates to the site in question, setting the cookie in the process. Job done.
Hey Scott,
We tried a few coupon sites a while back. The ROI was so poor, that even though the cost was relatively low, we canceled our programs. I figured there was some funny business going on. Another one we had trouble with was shopping search sites, Next tag was the worst offender. We saw tons of click throughs that left our site within a few seconds. After the first thousand dollars and no conversions, we canceled that deal as well.
Ridiculous that someone would put software on their site to click the links automatically. I like to hope that things like this don’t become widespread, but with the money that can be made, I feel eventually it will become a major problem. The end of PPC will eventually come.
I have been purchasing some stuff lately from the net. and everytime I see a coupon code there I would not continue on with payment. I normally will get info from the seller on the coupon code and most of them give it out freely.
But to my surprise so far most of the time these products are not that good and most of them are just ways of making money fast.
I certainly don’t agree with forces clicks, there are a number and one large affiliate in particular who blatantly does this and claims to have be responsible for merchant sales of over £30 million in the past year.
The choice of issuing discount or voucher coupons really should come down to the individual merchants, i certainly agree that any box placed at checkout is a recipe for enticing searches etc.
The question to ask is who should be policing this type of activity. Obviously if consumers were at the other end of this type of questionable activity, there would be lawyers involved and the affiliate sites would quickly change their tune. But since it is other business owners and entrepreneurs which are involved, it is tough to bring attention to this type of activity.
[...] also blogged about the issue, as did Scott Jangro and Lisa [...]
[...] To follow is my list of the Top 10 Affiliate Blogs for 2007. These represent my opinions on the best information, technology and news related to the affiliate marketing industry.1. Jangro.com. Scott Jangro always has been at the top of the affiliate industry for years. His blog has always been very consistently excellent. In particular we attended the ShareASale Think Tank. One of the major issues encountered during the event related to coupon sites. Scott wrote this post about affiliates related to “forced clicks” and “deceptive clicks”. The post also includes excellent comments from all sides of the industry. [...]