Assessing the maturity level of affiliate marketing in travel industry

Affiliate Marketing for the Travel Industry Special

The relationship between merchants and affiliates currently seems to be in a confused state to an extent.

Are affiliate marketers better at SEO than merchants? Do merchants view affiliate marketing as an unnecessary cost?

Providing an insight into the maturity level of affiliate marketing, David Ranby, Internet Marketing Manager, Superbreak Mini Holidays says, “Maturity has been forced on the affiliate market by changes in PPC policies, increased adoption of direct marketing, and by the aggressive commercial models increasingly being adopted by the mass portals that used to think big visitor numbers were all that matters, and instead now have to pay dividends to new owners. The “hobby” affiliate is squeezed out and only specialists or professionals can survive.”

Ranby, who recently shared his viewpoint on how to implement an affiliate programme with EyeforTravel.com’s Ritesh Gupta, added, “The next few years will see increasing concentration of affiliate-generated traffic in the hands of companies who’s combined expenditure or website catalogue is such that they have relationships with the major sources of traffic. Such a scenario will inevitably fragment when/if the control of traffic volumes being to break up; when Google’s 70 percent+ shrinks, or when major information sites like the BBC decide to become  more commercial. The big affiliate distribution of the future is not through third party arbitrage sites but through actual media owners. Most likely is that instead of needing an affiliate to create long-tail PPC on Google for your product, you will pay Google the affiliate commission direct.”

Ranby also answered queries related to affiliate management solution and much more in an interview.
Excerpts:

Which affiliate management solution should one chose: standalone software, hosted services, shopping carts with affiliate features or third party affiliate networks? How can one go about evaluating such options?

Establish your own limitations first. Are they technical (cant supply xml functionality, don’t have a development team capable of building partner applications) or management-related? This may determine whether you need bought-in systems. Set your revenue goals and a realistic deadline to build towards the goals. Consider management resource; can you manage key accounts in-house of do you need third party management. Determine the margin available; if its small then the more filters (management company, network, ppc rules) you put in place the less likely the affiliate can afford to sell you.  Superbreak began with our own software and expanded to networks to gain reach, and to satisfy partners who wanted third-party tracking.

A study recently stated: Consumers lack trust in paid search and are turning overwhelmingly to natural search results. Considering this statement, how do you assess the situation from affiliate marketing perspective?

I have seen opposite studies suggesting consumers trust paid search above travel agents!  Affiliates will be trusted by consumers if the content is believable, the service does “what it says on the tin” and the supplier gives equal customer service to affiliate customers as they do to their own.
 
To what extent your clients agree to this statement: committed affiliates are potentially a powerful tool for a merchant’s “online reputation management”?

I agree a committed affiliate can enhance the brand reputation, but increasingly the affiliate is trying to enhance their own brand and use your product as simply the item they sell. Tesco are more bothered about their brand than the name of the farmer supplying them with potatoes. The same will be the case with large affiliates who are trying to sell many products better than the supplier.

What trends do you expect in foreseeable future when it comes to affiliate marketing?

More demand for customisation of process. Control of cash flow will become an issue, where an affiliate gets big enough to want to become the principle, not just the distributor. Higher commissions as distribution costs grow due to competition and overall switch of marketing spend.  Networks becoming distributors (affiliates) not just market places for dozens of products.

What’s on your agenda?

Customisation, long term partnership contracts, developments driven by partners, not just by us.