This month’s Internet Retailer magazine featured an article on the growing use of coupons, the ways these value-conscious consumers shop online, and what some merchants do to keep the frugal shopper yet by-pass affiliates. At this time the article is also available online here. It opens with these words:
Staffers at Macys.com detected a new pattern in customer behavior last spring: consumers would add items to shopping carts, leave the site and then return with discount codes they had found on the web sites of Macy’s affiliates. Only then would they complete their purchases.
“We said, maybe we should just do this ourselves,” says Kent Anderson, president of Macys.com
And they did — by adding a “Find one now” link next to the customary promo code box that many online merchants have on their shopping cart pages:
As a result, “consumer no longer has to search the web for those savings” and can complete the checkout without leaving the Macy’s website, which “also saves Macy’s the affiliate fee, typically 4-5% of the purchase amount,” says Anderson. Read more about it works in Michael Vorel’s post here.
Here’s an interesting detail though:
1. I go to an affiliate website that is focused around Free Shipping (either directly, or because I was looking for a free shipping deal at JC Peney, or Kohl’s, or some other Macy’s competitor) — FreeShipping.org — and while originally looking for something totally different, I decide to click on Macy’s link:
2. Upon reviewing the free shipping offers for Macys.com, I pick one, and click it (setting the affiliate cookie).
3. I get to Macy’s website, add the items I want to my shopping cart, and proceed to checkout; and I see exactly the same “Find one now” link again.
My testing has not revealed any affiliate cookie overwriting upon clicking the links in the pop-up window (shown after following the “Find one now” link), but I can definitely see some affiliates getting extremely uncomfortable about the way it all works now (it’s really just a step away from turning bad).
Additionally, if a customer originally comes to your website from an affiliate’s website (coupon or not), is offering them a coupon really gonna save your margins? Say, it was a shopping comparison affiliate that didn’t push coupons, but you are now offering the consumer an additional discount.
Macy’s current system obviously has some holes to patch.
Are There Better Solutions?
I’ve had a merchant bring up the question of paying too much (discount to customer + commission to affiliate) to me literally two days ago, and this is certainly an area of concern for many merchants with affiliate programs. I understand their worries, and I have seen some banning coupon affiliates altogether, while others deciding to pay from low to no commission on coupons. My opinion is that neither of these decisions are good. You can still work with coupon affiliates, and not let the system devour your profit margins. Using coupon affiliates to push offers like Free Shipping on orders over a certain amount, or Deal of the Day/Week offers, or discounts only on select products/services are just a few of the techniques a merchant can use.
What are your thoughts on this?