Zappos Affiliates: Look out Below!

by Scott Jangro on 06 February 2008

The undisputed leader of the online shoe market is feeling a big squeeze from their newest rival, Endless.com.

endless-zappos.jpg

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!

endless-negative-shipping.jpg

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.

zappos-home.jpg

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!

zappos-6pm.jpg

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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  • Qiana Jones
    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?
  • 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.
  • Qiana Jones
    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
  • 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.
  • 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.
  • (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.
  • Sheryl
    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.
  • Nabs
    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 )
  • 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.
  • 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].
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