The Solution to Incrementality Success

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This is a podcast episode titled, The Solution to Incrementality Success. The summary for this episode is: <p>In this panel guests discuss affiliate channels and how customers are using Honey by PayPal's tools to drive sales and expand the bucket with new customers.</p><p><br></p><p>Highlights of today's episode include: </p><ul><li>Why affiliate is an efficient channel for brands to drive sales</li><li>How to think about acquiring new customers and exposing your brand to new publishers</li><li>What brands should be looking for when recruiting new publishing partners</li><li>Targeting younger shoppers and welcoming them into your brand ecosystem early</li><li>TM Plus, Honey's SEM solution that helps drive traffic and conversion</li><li>Strategies for brands looking to increase their AOV</li><li>Mobile and app strategies for driving higher AOV</li><li>Testing new offers, measuring the impact to AOV</li><li>Driving sales efficiently and being mindful about your margin</li><li>Leveraging affiliate exclusive codes</li><li>Trends in the affiliate space to look out for in 2022</li></ul><p></p>
Meet the panelists
01:21 MIN
Why affiliate is an efficient channel for brands to drive sales
03:44 MIN
How to think about acquiring new customers and exposing your brand to new publishers
01:58 MIN
What brands should be looking for when recruiting new publishing partners
02:26 MIN
Targeting younger shoppers and welcoming them into your brand ecosystem early
01:45 MIN
TM Plus, Honey's SEM solution that helps drive traffic and conversion
03:38 MIN
Strategies for brands looking to increase their AOV
03:02 MIN
Mobile and app strategies for driving higher AOV
02:33 MIN
Testing new offers, measuring the impact to AOV
01:49 MIN
Driving sales efficiently and being mindful about your margin
04:27 MIN
Leveraging affiliate exclusive codes
03:16 MIN
Trends in the affiliate space to look out for in 2022
02:45 MIN

Fabian Rodriguez: Hey, everyone. In today's episode of the Honey Buzz cast: eCommerce Industry, Trends,& Insights, PayPal Business Marketing's Alex George chats with me, Fabian Rodriguez, the producer of the Honey Buzz cast, about trends that brands need to be aware of in order to capitalize on gains in se-commerce and the post- pandemic retail landscape.

So great to see all of you guys in person. Thank you so much for joining our session today. As mentioned, I'm Lindsey Grillot, Senior Manager of Partnerships at Honey by PayPal. Honey is an online shopping community where we empower shoppers with a better way to shop and brands with a better way to help drive sales. We connect e-commerce brands with Honey's audience of loyal shoppers, helping them attract, retain, and convert high- value customers. Today, I'm joined by my friends, Erica Cipolin and Nick Ranelle, and I'll let them introduce themselves.

Nick Ranelle: Hi, I'm Nick Ranelle. I'm a senior manager at CJ Affiliate. I've been with CJ for a little over two years now, and prior to working at CJ, I actually worked client side. CJ, for anyone who doesn't know, is an affiliate agency specializing in technology and marketing services.

Erica Ciporen: Hi, I'm Erica Cipolin. I'm the Affiliate Marketing Manager for vitacost. com. We are a Kroger company. I've been with them for five years now. We are an se- commerce- only health and wellness company. So I like to say that we sell everything in the center aisles of Whole Foods for less, and shipped right to your door. We ship to over 150 different countries, and our top categories are vitamin supplements, healthy food, clean beauty, pet, baby, eco- home, and it's all direct to your door.

Lindsey Grillot: Awesome. So We know that you're all either interested in embarking on or improving your performance marketing strategy, right? Let's just do a quick show of hands before we get started here. Who here is joining us today from the brand side? Awesome. Is there anyone here from the publisher side? Great. What about the affiliate network side? Couple hands. And anyone here from an agency? Cool. Awesome. Well, thank you so much, like I said, for joining us today. So as you all may know, some of the top challenges that brands face in our industry include acquiring new customers and specifically trying to reach that younger shopper, so that millennial, Gen Z audience. Increasing AOV or basket size is a big one, and also, obviously, driving sales as efficiently as possible, so being mindful of market. So thinking ahead now, does this sound familiar? These are challenges that we're all working on on a day to day basis? Cool. So today we're going to discuss how the affiliate channel is a great way for brands to address these challenges. And we're also going to share some actual strategies that Vita cost is currently using in collaboration with their affiliate network, CJ, and publishers like Honey to meet these challenges and ultimately drive performance for their business. So Nick, to kick us off today, why is affiliate an efficient channel for brands to drive sales?

Nick Ranelle: Yeah, affiliate's an efficient channel because it is a CPA- driven channel that enables the rich partnerships between publishers and advertisers to touch consumers at every point in their purchase journey. So whether they're trying to find brands at the best value or items at the best value or product discovery, the affiliate channel really enables the full funnel traffic from that perspective.

Lindsey Grillot: Awesome. And Erica, what role does the affiliate channel play within Vita cost's broader marketing strategies?

Erica Ciporen: So in our broader marketing strategy, it does play a very large role. Not only is it a top revenue driver for us, for the whole business, but it's also one of our key channels to reach new customers alongside social media marketing and our search efforts as well.

Lindsey Grillot: Yeah. So how does Vita cost's approach to affiliate differ from your other marketing channels?

Erica Ciporen: Yeah. So we have a very carefully planned out approach. Basically, I think the way that affiliate differs is that the channel allows for more agility and different kind of agility than other channels that we have. So whether we need to do a fast pivot to drive sales for a promo that's already going on and we need to boost it quickly, or we want to offer customers incentives that they can't find elsewhere. There's a lot of levers that we can pull in the affiliate channel.

Lindsey Grillot: Yeah, definitely. So I think this will just be helpful for later on in our discussion. How does Honey specifically fit into Vita cost's affiliate strategy?

Erica Ciporen: Our affiliate strategy is very heavily focused on gaining new customers. And the demographics that we really want to reach are millennial and gen Z customers to add them to our loyal customer base. So Honey is a great fit for that because that is Honey's core demographic. Honey also has great solutions for us to stay on budget while reaching those new customers, which is very important for us. There are times when we are more promotional and some times that we are less promotional that we call our dark days. So these are days that we would have brand- level promos running, but nothing site- wide. Honey really allows us to have a great strategy in place where we can make up on those dark days. Some of the margin that we might have lost on our bigger sales that, while they drive more revenue, they do hit the margin harder. Honey's a great partner for that.

Lindsey Grillot: Awesome. Yeah, I think that was super helpful to kind of set the stage, the next part of our discussion here. Next, I think it would be really helpful for you both to take us through some actionable strategies that brands can pursue geared towards solving those three challenges that we mentioned previously. So again, acquiring new customers, targeting that younger shopper, increasing AOV or basket size and ultimately driving sales efficiently being mindful of margin. So I'm really excited to hear your perspective, Erica. You live this every day. You're always facing these challenges and coming up with creative solutions to address them. And Nick, I know that you work with so many different brands across so many different verticals, and they really rely on you as that trusted partner and advisor. So really curious to hear both of your thoughts as we continue on in our discussion today. So Nick, what would your recommendations be if a brand told you that they were looking to acquire new customers?

Nick Ranelle: Yeah. Outside of optimizing with publishers that you're already working with, I think a CJ recommendation we would always make is to have active and ongoing recruitment efforts because it's a great way to just continuously grow who you're exposing your brand in front of with new publishers.

Lindsey Grillot: Yeah. So how would a brand go about sourcing new publisher partnerships? Would your recommendation be to partner with their affiliate network team, or should they mass apply in the networks? What do you think?

Nick Ranelle: Yeah, there's a couple of different ways. If you're already working with a CJ team and you've outlined your business goals to us, then chances are, we're proactively doing recruitment for you to make sure that we are working with publishers that are going to meet those business goals. But if you're an advertiser who is looking to just do some outreach and do some more research, CJ actually offers a recruitment tool where you can go in and do a deeper dive on some of the demographics that publishers may have. And you can do some more personalized outreach, rather than just kind of mass blasting a bunch of publishers.

Lindsey Grillot: Gotcha. And what type of results do those typically have on an advertiser's program? Are there any metrics they can share?

Nick Ranelle: Yeah. Within the CJ network, we see advertisers who are actively recruiting generally see two times growth over a five year period compared to advertisers that have a closed program.

Lindsey Grillot: That's awesome. So let's say that a brand is actively recruiting new publisher partners. What should they be looking for? Is your recommendation to test lots of different types of publishers? Should they stay in a niche? What does that look like?

Nick Ranelle: Yeah, it's super important to make sure that you have a diverse portfolio across your publisher base. I know a lot of times we see brands are kind of hesitant to expand out of publishers that are driving the majority of their revenue or actions for them. But you want to make sure that you're consistently recruiting, testing into new publisher types, and optimizing with them consistently as well to make sure that you have an overall diverse portfolio.

Lindsey Grillot: Yeah. So could you elaborate a little bit more on some different publisher types and how they differ from each other?

Nick Ranelle: Yeah, again, I think a lot of advertisers see the bulk of their actions or revenue come from things like coupon or loyalty publishers, but you really want to make sure you're not overlooking things like mobile; buy now, pay later, which just enables a new way for customers to check out and pay; influencer networks to make sure you're capturing a full funnel traffic; or even something like a software publisher, which might be able to give you some new technology on your site that you don't currently have access to.

Lindsey Grillot: Awesome. And Erica, how has Vita cost optimized their publisher mix?

Erica Ciporen: Yeah, we work closely with our CJ team to optimize our mix. I think loyalty, coupon, and reward sites really do very well for us. But we do have a full array of publishers that we work with including content, social shopping, mobile, and sub- affiliate networks. We've really seen that the new publishers that we add into our program on an annual basis significantly add to our incremental revenue.

Lindsey Grillot: Awesome. So what does that balance look like now that you've welcomed in some of those other publisher types to the program?

Erica Ciporen: So we like to keep a good balance of top revenue drivers for us, but we also want to future- proof by adding in new and different publishers and then testing those relationships and seeing how they can work for us.

Lindsey Grillot: Awesome. I know buy now, pay later is definitely an up and coming strategy. Consumers love it. Is this something that you have introduced to Vita cost's publisher mix yet?

Erica Ciporen: Yes. Oh yes. And so we're very excited about that, and we're hoping that it will become a larger piece of our program in the future.

Lindsey Grillot: Awesome. So Nick, Erica mentioned before the importance of targeting that younger shopper so that you can welcome them in early, they could become a loyal shopper of your brand. So let's say that a brand wanted to target that younger customer, specifically that gens Z or millennial shopper What would your recommendation be to them?

Nick Ranelle: Yeah, I think again, you really just have to dig into the demographic data and make sure that the publishers you're reaching out to and recruiting are kind of hitting those overall business goals. So if you're looking for a younger audience, are there more mobile publishers you could be working with? Are there more influencers you could be working with? Just kind of help expand your reach in that audience.

Lindsey Grillot: Yeah. And are there any publishers that come to mind that you know from your experience have audiences that skew a bit younger?

Nick Ranelle: Yeah. From a loyalty perspective, Honey is a great publisher to work with. We know that they skew a little bit younger demographically than some of the other loyalty partners. Buzzfeed would be a great example of a content partner. Skimlinks would be a great example of an ad network partner who works with lots of different sites that tend to skew younger. Or even a publisher like Uni Days who specifically targets college- aged students.

Lindsey Grillot: Awesome. And Erica, what initiatives has Vita cost launched to reach new customers?

Erica Ciporen: Yeah, so reaching new customers, as I mentioned, is our top priority, but it definitely is more expensive. And so we are always looking for ways to maximize our budget. So with Honey specifically, we did start up with the TM Plus program, and that has helped us to do exactly that, to stay on budget, make sure that our costs are going only towards acquiring customers and also just helping us to grow with Honey.

Lindsey Grillot: awesome. Yeah. I know we've seen a ton of success working with y'all on the search space through the TM Plus campaign. So let's dive into this a little bit more, since I think there may be some unfamiliarity with TM Plus. So TM Plus stands for Trademark Plus, and it describes Honey's SEM solution that helps us drive more traffic and more convergence to our brand partners like Vita cost. So TM Plus partnerships with a live TM Plus campaign, Honey would bid on keyword permutations. So that would be the merchant's brand name plus coupon suffixes. So for example, Vita cost promo code or Vita cost coupon. We do this so that we can help the brand, in this case, Vita cost, capture more incremental market share and drive more incremental sales to their brand. So TM Plus partnerships are really beneficial to brands like Vita cost as we've said, because publisher partners like Honey can help them capture more real estate on the search engine results page. And it also utilizes the publisher's brand recognizability to help them acquire and convert new customers that may not have shopped with that brand before or may not be familiar with them before. So Erica, what made Vita cost want to test TM Plus partnership with Honey, and how has the campaign been going so far?

Erica Ciporen: Yeah, so it's actually something that we avoided testing for a while because we were so very sure that it would cannibalize our search marketing efforts. But we've actually really seen that the Honey TM Plus partnership has enabled us to better root out rogue bidders, dominate the top spots in search, and also has funded great placements and created efficiencies in the ways that we can reach Honey customers.

Lindsey Grillot: Awesome. Do you want to share just a little bit more about those placements or those exposure opportunities?

Erica Ciporen: So we get a lot of value from the TM Plus program because it actually funds the great placements around Honey. So we've eliminated, essentially, our flat fees. So we have placements in the Honey emails or on the Honey blog and then with influencer activations on YouTube.

Lindsey Grillot: Cool. Yeah, I know that one in particular of those influencer activations on YouTube was a huge hit. So let's talk about that a little bit more. What influencer did you all choose to work with, and why were they such a great fit for Vita cost?

Erica Ciporen: Yeah, so we've actually had the pleasure of working with a few different influencers over the course of the program. I think the most successful one to date was with Simeon Panda. He's actually a very big fitness influencer, and he has over two million followers on YouTube. He created a video for us that was just very on brand. Just the messaging was spot- on. Our executive team was thrilled with the messaging. He also injected some humor into it, which was very cool. And the video ended up getting over 88,000 views. So the whole team was very pleased with that awareness and performance.

Lindsey Grillot: Yeah, that's great reach. So what are some metrics that you can share about the success of the TM Plus campaign so far?

Erica Ciporen: So we've actually seen some great results. The TM Plus campaign itself has had a 16 percent higher AOV than the total Honey program in 2021 for us. So that's pretty significant. As well as also, it makes up close to 20 percent of the revenue for our program with Honey. So it's a big chunk.

Lindsey Grillot: Yeah. That's super helpful to even just understand the metrics that you're looking at to evaluate the performance of the campaign. That's great. So speaking of AOV, so as you all remember that was the number two challenge that we mentioned previously. So Nick, could you take us through some other strategies that you would recommend if a brand was looking to increase their AOV or drive a higher basket size?

Nick Ranelle: Yeah, I know we were just talking about TM Plus for a while, and at CJ, advertisers that we see that are working with publishers who are using TM Plus generally see an$ 80 lift across their AOV when they are running successful TM Plus campaigns.

Lindsey Grillot: Oh, that's a lot. That's pretty significant. That's good to hear. So let's say that an advertiser was interested in testing TM Plus. What steps do they take to find publishers to test with?

Nick Ranelle: Yeah, I think if you're already working with a network partner or a team, I know we could proactively reach out to publishers that we know offer good partnership and can help supplement your current internal paid search keywords. If you're an advertiser just looking to do some outreach, I would generally say start with a smaller subset of publishers. Someone that either sees really strong organic performance, or maybe they're a demographic that's a priority for you as an advertiser, and do some outreach there and see what kind of level of partnership they're willing to offer you and if they're willing to also connect with your internal paid search agency.

Lindsey Grillot: Gotcha. So before we had chatted about the importance of diversifying your publisher mix. So I imagine that if you are sourcing proposals or TM Plus packages from multiple different publishers, they're not all going to look the same. So how would you as a brand or as a network help your brand partners evaluate the proposals and figure out what is going to be best for their business?

Nick Ranelle: Yeah. When you're thinking about maximizing incremental revenue, it's again, just really that level of partnership that you're getting from the publisher and how they are best going to supplement your paid search efforts. It's not a tactic that's meant to cannibalize any of your current paid search keywords or tactics. So really see what kind of level of partnership the publisher is willing to offer you as an advertiser and how it best supplements what you're already doing in the paid search space. And that's really where we see the most incremental revenue come from that tactic.

Lindsey Grillot: Yeah. I know from the Honey perspective, we see the strongest performing TM Plus partnerships when we get everybody on call. We get the brand, we get their affiliate network, we get their search team or the agency who's handling their search efforts, along with our team and our search team. And I think this is really important to get everybody on the same page in terms of how the campaign will actually run. Set expectations up front and also align on how you're going to evaluate the performance of that campaign so there's no surprises later on. And I think that even just a group call like that really opens up the lines of communication. And honestly, I've just seen the strongest performance result when we do have those strong relationships in place right from the start. So Erica, any thoughts to add on that?

Erica Ciporen: Yeah. I definitely agree that being able to work closely with our search team is a top criteria for us when we're selecting a partner to do this with. It's really key for us to be in harmony with our efforts so that we can really maximize the program and root out rogue bidders as well.

Lindsey Grillot: Yeah. So Nick outside of TM Plus, what other strategies would you recommend to brands looking to drive a higher AOV?

Nick Ranelle: Yeah, I think again, at a higher level, you want to think about your mobile and app strategy. Having an optimized mobile and app strategy is super important to any advertiser since so much traffic is obviously coming now to mobile or the app. And again, within CJ, we see advertisers that do have an optimized mobile or app experience see an upward of a 10 percent lift on their AOV across the board. So that's obviously super successful. You can also work with a software publisher or a publisher even like UpsellIt who might be able to enable some onsite technology that can further encourage cross- basket shopping or maybe a popup that just encourages customers to add something else to their cart just kind of to get them to that next AOV threshold.

Lindsey Grillot: Yeah. So Erica, how is Vita cost capitalizing on this shift toward shift towards mobile?

Erica Ciporen: Yeah, we're definitely working towards creating a better experience. We know that it is a very key part of how we can serve and reach our desired demographic of millennial and gen Z customers. So we've actually partnered with Button to implement the button solution with CJ in order to drive more Vita cost app installs. We don't have a lot of ways to drive installs. So this was a great solution for us. And it also provides a very seamless experience to the customer because it allows for deep linking within the app, which is nice because if a customer is on one of our products and decides to download the app, they don't lose track of that product in the app download experience. So they can still find what they're looking for and check out. And it's very important to us because we have seen that our app customers are the most loyal and have higher basket size. So that's extremely important to us. We launched with the solution this past summer, and we've seen 10 percent incremental growth in our app installs.

Lindsey Grillot: Awesome. Great.

Erica Ciporen: Yeah. And we're also able to track all the performance through just the CJ platform. So it's very easy for us as well to have it all in one place.

Lindsey Grillot: That's so exciting. Glad to hear that you guys are seeing some strong results there. So Nick, any other strategies that come to mind when you think about what a brand should be doing to increase their AOV?

Nick Ranelle: Yeah, I think outside of TM Plus and mobile, just consistently testing new offers, making sure what you're giving the consumer as potentially a discount is resonating with them. Keep an eye on competition. See if they're doing anything different with any of the publishers that you might already work with. You can also think of creative ways to maybe bundle products on your site. I know I've seen success with a couple advertisers who've been able to offer several products together as one, with maybe a small discount. Or even a gift with purchase is a great way to just get people to the next level in their basket.

Lindsey Grillot: Yeah, that's a great point. I know that I personally have seen a lot of success when certain brands offer GWP, gifts with purchase, or bundling, because you can really still create that value and that excitement for customers, even if couponing or discounting just isn't available or feasible for whatever reason. I've also seen this executed really well in the luxury space, where typically discounting or couponing is just not part of the brand strategy. And that's okay. That's when some of these other more creative strategies like GWPs or bundling can really come into play and still drive performance through the affiliate channel without having to offer discount on those products. Any brands come to mind that you've seen execute this really successfully in the past?

Nick Ranelle: Yeah. I happen to have a great example of how we executed this well. I worked with a beauty vendor who wasn't able to offer any kind of site- wide or product- specific discount outside of Q4, so we had to get a little bit creative to kind of reach those year over year revenue goals without being able to comp any of the offers that we had given the year prior. So we ended up doing a tiered affiliate exclusive promo code for gift with purchases. It worked out really well. It was a tiered basket strategy, so essentially the more you put in your basket, the better GWP you got. And it also worked out really well for the client because we were able to move through older inventory on the site by offering those as the free gift.

Lindsey Grillot: Yeah. Interesting. That's something that we haven't chatted about yet today, but I think that's important to note. So through affiliate, there are so many different strategies that you can leverage if you need to move through inventory. So for example, seasonal goods, stale inventory. We saw a lot of challenges with the supply chain during COVID. So yeah, ideas like that are great to keep in the back of your head. So going back to our list of the three key challenges that we thought were the most prevalent in our industry, obviously driving revenue is key. As marketers, that's essentially our job, and I know that this holds true for Vita cost as well. So Erica, can you take us through some strategies that Vita cost has used or is currently using to make sure that you're driving sales efficiently and being super mindful about your margins?

Erica Ciporen: Yeah. So with Honey specifically, Honey Offers is something that we've been participating in for years. And it's targeted, limited- time cash back on specific products. Honey also will send a retargeting email for us as well. And so this is a really good way for us to stay relevant to the Honey customer and also incentivize the types of actions we want to see.

Lindsey Grillot: Awesome. Yeah, I know firsthand how successful that campaign has been, so excited that you brought that up. So to elaborate a bit more on Honey Offers if you're unfamiliar. Like Erica said, Honey Offers are awarded to the customer at the product level. So what this means is that it allows brands to target their ad spend directly against the products or categories or even sets of skews that they're really looking to push. So how it works is the Honey system will optimize that ad spend and match deals with Honey members' real- time shopping intent. So those deals will show up across the entire Honey platform, so through retargeting emails, like Erica mentioned, through our online shopping discovery platform, as well as the Honey extension, which many of you are probably pretty familiar with. So Honey Offers is an awesome option if you're looking to increase revenue in a really hyper- targeted way. And it's also great at helping you move through inventory, just like you were talking about before. It's another strategy that you can utilize there as well. I've seen some brands utilize Honey Offers to give some extra love or extra boost to sales when there's an important site- wide promotion running. But on the flip side, I've also seen brands be really successful with this to add a little love to their site when they don't have a promotion running, like the dark days that Erica was talking about before. So it's a super versatile option, and there are so many different ways that you can customize it to really meet your needs, whatever those are. So Erica, are there any metrics that you could share with us about the success of the Honey Offers campaign so far, or just help us understand, which KPIs are you looking at to understand how the offers campaign is performing?

Erica Ciporen: Yeah. Our KPIs are new to file and certainly AOV. So with the Honey Offers, we have seen that there has been an eight percent increase in AOV for Honey Offers compared to the overall Honey program. And we've also seen a really great increase in new to file customers who are returning within 30 days to make a repeat purchase.

Lindsey Grillot: Awesome. Yeah, that's super exciting. So Nick, outside of Honey Offers, what strategies would you recommend if a brand is really looking to drive sales efficiently, being super mindful of margins?

Nick Ranelle: Yeah. I think margins is something that we talk about a lot more now with brands, whether it be a supply chain issue or maybe your finance team is just more engaged with how marketing is spending dollars to make sure that they're as efficient as possible. So an effective cash back and CPA strategy is definitely one of the first recommendations we would say. And CJ actually offers several products that allow you to adjust the CPA on a single skew or a group of products that you can pulse up or pulse down that CPA based on how margin- friendly that group of products or single product might be to your business.

Lindsey Grillot: Cool. Can you give us some examples of times that you saw that executed really well on the brand side?

Nick Ranelle: I have another example of a time we've executed this really well. I worked with a client who offered both private label products and third- party products on their site. Obviously the private label products were more margin- friendly, so we were able to scale the CPA there. We offered a much more aggressive CPA and we made sure that we got exposure across key coupon and loyalty sites, just calling it out wherever we could. And they were actually able to scale that business within the affiliate channel. So they took it from three percent of their overall business to almost 10 percent of their overall business just by offering the higher CPA on that group of products.

Lindsey Grillot: Awesome. So in addition to optimizing CPA rates, which is obviously very, very important, have you seen brands be successful when offering affiliate exclusive codes?

Nick Ranelle: Yeah. Affiliate exclusive codes is another way that we generally recommend to utilize those dark days where you maybe don't have a super strong promo. You can offer something exclusive to the affiliate channel. And it's a great way to kind of drive some incremental revenue on a day you expected some softer performance. It also really creates a win- win for publishers and advertisers because generally, if it isn't affiliate exclusive and you're working with a group of publishers or a single publisher and can offer them that discount, they're usually willing to offer you some kind of added value exposure, whether it's a newsletter placement or something for a homepage. And it's a win- win for both because the advertiser is driving more revenue and the publisher's kind of reaping the benefit of the commissions that they're able to drive there.

Lindsey Grillot: Awesome. And Erica, how is Vita cost leveraging codes?

Erica Ciporen: We use codes in many different ways. So some of the top ways that we use codes. Firstly, as we have on the site, maybe a promo that we've noticed is not as popular with customers coming from the affiliate channel. We will do an affiliate channel- wide exclusive code so that we always have something running in the channel that's a proven winner. Another way that we use codes is that sometimes for very top performing publishers, we offer a vanity code for a limited time for use in a placement, or perhaps during a dark period to boost revenue and sales during that time. And then another top way we use exclusive codes is sometimes we give codes to certain countries in order to incentivize a higher basket size for the customer's purchase. So that's a way for us to try to help offset the increased international shipping. So that's very important for us as well.

Lindsey Grillot: Yeah, that's actually a super smart strategy. It's very common for customers get caught up with those shipping expenses. I think we can all relate to that. So by offering that affiliate exclusive to help offset some of those increased costs, I'm sure really helps your conversion rates, which is great.

Erica Ciporen: Yeah. Definitely.

Lindsey Grillot: Awesome. So Nick, if a brand wanted to set up an affiliate exclusive code, how do they determine what value to offer the customer?

Nick Ranelle: Yeah, I feel like I've said it a couple times, but it's really important to just leverage all the data that you can, and also important to establish what you want the code to do, not just offer a blanket discount unless you want to drive incremental revenue. If you're looking to increase basket size, what offer is going to resonate most to again, get your customer to spend a little bit more? Do you actually want to capture new customers to your site? What are your competitors offering, being mindful of what they're doing in this space? And then I'd also say reach out to your top publisher partners that are driving all that revenue for you. Generally, they're going to have some great recommendations or insights into again, maybe what your competition's doing or even something they're seeing on their site that you're not seeing on yours. And you can kind of leverage what they might have to offer as well.

Lindsey Grillot: Cool. Yeah. I'm definitely sensing a theme here. So I think we all know, but it bears repeating. Collaboration is key in the affiliate channel. So that means collaboration between your different marketing channels, collaboration between advertisers, publishers, affiliate networks, agencies, everybody. Especially when you couple that with using data to make those data- driven decisions, you're really going to set yourself up for a lot of success. So thank you both for those insights. I think that was really helpful. And now I'd like to switch gears a little bit. So I want to talk about what the key trends that you two are watching in the affiliate space in 2022 are. So Nick, what is on CJ's radar right now as we're emerging from COVID? What's the key trends that are top of mind for you all?

Nick Ranelle: Yeah, I think one of the first things, and we've heard it maybe at a couple other panels today, but how is the affiliate channel going to continue to be a power player across all the channels and capture that full funnel traffic and really exposing customers at all kind of touch points? So brands are going to continue to want to leverage content and influencer campaigns at that really efficient CPA basis to make sure that they're always top of mind for customers.

Lindsey Grillot: Cool. Yeah. We've certainly seen the impact of influencers grow significantly over the past couple years. And I think when we were chatting before, you mentioned the importance of omnichannel campaign, so just elaborate a little bit on that for us.

Nick Ranelle: Yeah. It's no longer the affiliate channel just siloed on its own but how is it supporting all of your other paid channels? How is it driving more visitors to your site? How is it supporting your paid search efforts and really capturing that omnichannel focus and full funnel traffic via influencer networks or content, or even some newer creative placements that some publishers are offering.

Lindsey Grillot: Cool. And any other trends that you're watching that we should expect to see play out in a big way this year?

Nick Ranelle: Yeah, I think two other things which have probably also been mentioned in other panels, but travel. I know everyone's excited to get back out there. This is my first conference since 2019, so it's nice to see people in person again. And then also data transparency and just the importance of sharing data, using all the data you have at your fingertips between advertisers and publishers. Truly make sure you're driving the most value and best experience for your consumers because they're more empowered than ever during the whole shopping journey.

Lindsey Grillot: Awesome. Yeah, from the Honey side, we've definitely seen an uptick in travel as well. We do not expect to see this slow down anytime soon. So thank you for pointing that out. And Erica, any thoughts to add? What are the trends that you're watching from the Vita cost side?

Erica Ciporen: Yeah, I can't say that the trend in travel is changing our marketing strategy. But one trend that we have seen actually growing over the past few years and certainly accelerated by the pandemic is the customer's increased mindfulness of health and wellness. So that is right in our area. In terms of the data transparency trend that you're both mentioning, that is definitely a trend that we have jumped on from the very beginning. We think it's so important to share data because it just helps us to achieve our common goal. So we're always happy to share out any campaign performance or trends that we're seeing within our own business with our partners.

Lindsey Grillot: Awesome. Great. So before we wrap up, just want to review a couple of key takeaways from the session today. Marketers today, like we discussed, face so many different challenges, and the main ones being, in our opinion, attracting new customers, specifically that younger shopper; increasing AOV or basket size; and ultimately driving revenue as efficiently as possible and just being extra mindful of margins. And the affiliate channel can really offer a lot of incremental value to se-commerce brands. So based on the brand's specific needs and KPIs, there are so many different strategies that you can pursue geared towards solving your specific challenges. So we recommend, as we said several times, collaboration. We recommend that brands partner with their affiliate network or agency partners to really determine the best comprehensive strategy for the program. And be super transparent with your publisher partners as well. Be transparent about your goals and really work together to brainstorm and collaborate on the most creative, innovative ways to meet the publisher's member bases in the most effective ways possible. And consider testing optimizations like you mentioned today, including TM Plus partnerships, optimizing your commission strategy, leveraging loyalty and rewards, and really recruiting a diverse publisher mix. And Even consider testing some of those more targeted product level campaigns, like we mentioned Honey offers as well, to figure out what works best for your business and really drive direct sales to your business and move things forward. So if you have any questions at any time, you're always welcome to reach out to the three of us. And thank you so much, Nick and Erica, for joining me today. This was awesome. And thank you all for attending our session. Hope that you found it valuable, and hope you all enjoy the rest of the show.

Fabian Rodriguez: Thanks for listening to this episode of the Honey Buzz cast: eCommerce Industry, Trends,& Insights. To learn more about how Honey can help grow your business, reach out to honey- partner- support @ paypal. com And be sure to follow us on Apple Music, Spotify, or where ever you listen to podcasts.

DESCRIPTION

In this panel guests discuss affiliate channels and how customers are using Honey by PayPal's tools to drive sales and expand the bucket with new customers.


Highlights of today's episode include:

  • Why affiliate is an efficient channel for brands to drive sales
  • How to think about acquiring new customers and exposing your brand to new publishers
  • What brands should be looking for when recruiting new publishing partners
  • Targeting younger shoppers and welcoming them into your brand ecosystem early
  • TM Plus, Honey's SEM solution that helps drive traffic and conversion
  • Strategies for brands looking to increase their AOV
  • Mobile and app strategies for driving higher AOV
  • Testing new offers, measuring the impact to AOV
  • Driving sales efficiently and being mindful about your margin
  • Leveraging affiliate exclusive codes
  • Trends in the affiliate space to look out for in 2022



Today's Guests

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Erica Ciporen

|Affiliate Marketing Manager at Kroger Digital
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Lindsey Grillot

|Former Senior Manager, PayPal Shopping Partnerships
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Nicholas Ranelle

|Senior Manager, Client Development at CJ Affiliate