February 6, 2008
Zappos Affiliates: Look out Below!
The undisputed leader of the online shoe market is feeling a big squeeze from their newest rival, Endless.com.
Endless.com, owned by Amazon.com, came on strong a little over a year ago with a gorgeous website and crazy aggressive free shipping deals. Since they launched, Endless has been offering free overnight shipping. And now they’re offering a negative $5 shipping offer. egads! It’s a full on assault!
Zappos responded with their own free overnight shipping. Good for them, but, this surely put a big pinch on their bottom line.
In the past year, since Endless is on the scene, Zappos as purchased another online shoe retailer, 6pm.com.
And now they’re offering up some pretty strange new product selections. Accessories and handbags, sure. But electronics? and ski goggles on the homepage? Interesting move.
There’s an expression, “shit rolls downhill”, and it seems Zappos affiliate program planted firmly at the bottom of Mount Zappos.
Strike 1: As a direct result of the free overnight shipping, Zappos cut their affiliate program commissions by 20%. “No worries,” they said. “Sales will increase proportionately.” Didn’t happen. That’s fine to test, but they never reversed the move.
Strike 2: After acquiring 6pm.com, they quickly shuttered up the affiliate program.
Strike 3: And recently, they’re promoting steep discounts at 6pm.com on just about every page on their website. Holy leaks batman!
Just in case this one’s not obvious to you, here’s the issue: Affiliates are sending traffic to zappos, some percentage of which is getting sent away to 6pm.com.
If I just spent $0.50 to get that visitor, get ‘em all worked up over a pair of Ugg boots, send them to Zappos, and Zappos sends them over to 6pm where I get nothing? No thank you.
That’s not just rolling downhill. That’s a mudslide.
Three strikes — Is Zappos out in the eyes of affiliate marketers? It’ll be very difficult to stop promoting Zappos entirely as they have the largest inventory by far, but they’ve enjoyed favored merchant status for years which will certainly start to decline. Time will tell, but it’s not looking good.
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Great Post!
Another reason for affiliates to promote endless over zappos is that endless, with their negative $5 overnight shipping and an almost leak-proof website is sharing 15% as affiliate commissions, which is the same as what zappos offered - BEFORE they were offering free overnight shipping (they offer 12% right now).
BTW,
Zappos announced a few weeks ago that they will stop offering free overnight shipping soon (http://finaltag.com/2008/01/09/no-more-free-overnight-shipping-at-zappos/)
Warming up the visitor and directing them to zappos is a joy but if zappos sends them to 6pm.com and you get nothing… that’s utterly frustrating.
Good point Pranav, I meant to mention the 15% commissions at Zappos.
And yes, even though they could link to Amazon.com from Endless, they don’t. At a glance, I don’t see a single link out. Amazon clearly knows a thing or two about keeping reigns on a visitor, never mind how to run an affiliate program.
It’s astonishing to me that Zappos has done basically nothing to their horribly ugly website in all the years I’ve been using them. I’m a huge Zappos fan, but if I were to just run across their website, I’m almost certain I wouldn’t feel confident enough to buy anything from them. I’m sure Endless’ conversion rates are close to double Zappos’. It’s a shame.
Complacency breads competition.
Thank you for information
Several months ago, Zappos also started allowing BHO affiliates in (like eBates, iGive and UPromise). These “partners” drain the returns Zappos seeks in their affiliate channel, hurting the channel overall. In addition, individual affiliates are affected by a leak / loss to these automated cookie machines taking credit for their referred visitor’s return day sales.
What a mess, from darling to loser in very short order.
By the way, eBates has a 12% Zappos rebate posted on their site… so it’s clear what affiliates need to do to deserve top commission rates from Zappos…
At least CJ’s happy… [/sarcasm].
Just wanted to add my two cents here, as the Affiliate Marketing Manager for Shoes.com we feel we offer a compelling agrument for affiliate operators. Our commission are among the top in the shoe category (starting at 13% and up to 20% for our best performers) and of course our selection is top shelf with more than 450 brands and counting every day.
Add into it free shipping both ways, and the ability to do display URLs in your search ads we feel we are hard to beat when it comes to affiliate partnerships. Our Saturday Sale (held on the second Saturday of every month) is always a top volume day for us and our affiliates.
If you have worked with us in the past, we would love to have the chance to work with you again, if you have never worked with us before, I encourage you to test us out with a few campaigns and see how we do, I think you will be pleasently suprised.
Feel free to drop me a line if you have any questions or commments as well (ksmith@brownshoe.com).
Zappos has clearly demonstrated that they have an affiliate marketing manager who just does not get it. They let their program go for so long with no management that when they finally opened their eyes, it was a mess! In their mad dash to maintain profitability, they are shooting the value-add affiliate in the foot by redirecting traffic to 6pm.
Log in to your CJ account and you will see the text link to the affiliate page prominently displayed in the #2 position in their text link offerings.
I don’t think they shut down the 6pm program upon buying them because the adware guys have CJ links to 6pm that work, so they simply made it private and let the network have their way with it.
I have a feeling that they will change their ways soon enough when senior management realizes what a foolish move this was, but it will likely be too late because with every passing day their affiliates are jumping ship and we don’t easily forget things like this.
I don’t see Endless.com anywhere near to Zappos.com , WHY ?
Endless.com (Action Referral Occurrences = 1 time(s))
Zappos.com ( Action Referral Occurrences Unlimited )
Nabs, say what?
I have no personal stake here (I promote services, not products), but I find Shane’s comments questionable. In my view, Zappos.com isn’t ugly. What makes you “sure” that Endless’s conversion rates are almost double Zappos? Their metrics don’t support your contention.
Nabs is saying that Endless affiliates are only compensated for one sale per affiliate link click-thru. If you click through a Zappos affiliate link, you are compensated for every purchase the customer makes for 90 days unless the customer overwrites or deletes the cookie (or uses a different computer).
Without knowing how many of each company’s customers purchase more than once per 90 day period, it’s impossible to weigh the benefits of Zappos unlimited actions vs. Endless’s higher commission.
(edited) Thanks for the heads up! I just joined their affiliate program and was about to start making a few posts on my blog. I think I’ll find a new merchant because them sending traffic away to another site where the cookie doesn’t follow is just plain dirty.
Is there anything Amazon haven’t got their grubby hands on? Jeez.
Ok, I will admit though, there is a part of me that quite admires Amazon’s sheer level of creativity and determination. I could do with a slice of the latter as I’m afraid it’s not one of my stronger points (I can make a mean salsa though!).
I think Amazon should offer to buy Zappos out. I’m not really feeling their name either. ‘Zappo’ sounds kinda silly to me. But maybe that’s just me.
The ski goggles on the homepage are at least seasonal and Oakleys… but then again, if they’re sending your traffic to 6pm.com and you get nothing from the affiliate sale then that is out of order.
Hi Guys,
I know some of you may remember me as the affiliate manager at Zappos about 2 1/2 years up to about a year ago. I was reading everyones post and it seems like everyone is unhappy with the affiliate program at Zappos. Can you guys give any input as to what you think could make it better or any suggestions to improve things? Has anyone contacted the current affiliate manager with suggestions? If so, what was the outcome?
Thanks,
Qiana
Qiana,
would love to see zappos get back to paying 15% commissions now that free overnight shipping isn’t offered anymore.
Not all’s bad though, after posts like this one and elsewhere on the blogosphere talking about zappos’ 6pm fiasco. Offering commissions for ‘leaks’ to 6pm, albeit only 5%, was still a good move.
Wow!! I did not know that was going on. I’m really sorry to hear that so many people are unhappy with the program now. Who is the current AM over there?
Zappos affiliate manager never replies the email. NEVER EVER. I am very very unhappy with Zappos.
I have heard from my friend that Zappos affiliate manager is himself a affiliate of zappos and he is making big money by cheating other of their keywords and not let others in the affiliate program.
I hope and pray endless grows faster. I got my biggest check from Endless this time. They are growing. Long way to go but they are growing.
GO Endless…….. We are with you.
FYI all, 6PM has started paying 12% now, as much as zappos, so it wouldn’t make much difference whether your referral resulted in a sale at Zappos or 6PM.
I’m not sure thought if the new commissions are just for this month or a permanent change.
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