CASE STUDY - Affiliate Marketing and Virgin Mobile Wednesday 28 February 2001 PDF Print “Partnering with MagicButton.Net enabled us to drive targeted contextual promotions through selective partner sites increasing the effectiveness of our promotions” Annie Brooks, Online Marketing Manager VirginMobile.com Affiliate Marketing in simplistic form: Affiliate marketing is the leading pay-for-performance marketing method whereby content sites, who have compelling content and a large audience, create links or magicbuttons to merchant sites (like Virgin Mobile) with complementary commerce offerings and in return for sales, referrals, registrations or leads, get paid a commission. Virgin Mobile benefit by acquiring new customers and driving repeat sales on a pay-for-performance basis while affiliates (content sites) benefit by converting their audience and content into revenue and association with a leading brand like Virgin Mobile. The Power of Affiliate Marketing: At MagicButton.Net, we focused on developing and implementing the following success factors to provide Virgin Mobile with a successful affiliate marketing strategy: 1. Identified suitable affiliate partners for Virgin Mobile to ensure relevance between the affiliates’ content and Virgin Mobile’s commerce offering in order to increase link effectiveness. 2. Regularly updated and added value to the Virgin Mobile proposition by evolving their offers. Some methods implemented were: - To increase commissions based on performance as an added incentive for the best partners striving for the best link placement. - To offer affiliate partners new dynamic creative links using different technologies like flash and allowed affiliates access to the latest Virgin Mobile products. 3. Affiliate relationship management: Worked with Virgin Mobile on a monthly basis to retain and inform their affiliates about upcoming offers, links and promotions, to assist in retaining and maximising relationships. 4. Contextual placement of the Virgin Mobile magicbuttons increased the effectiveness of its promotions. 5. Data mining and analysis of the detailed reports identified the correct partnerships to maximise. The Online Marketing Toolbox: Affiliate marketing has firmly established itself as an essential component of the online marketing mix. Recent predictions such as this from US based Gartner Group; an Internet research firm who forecasts that “…by 2002 over 50% of online sales, or $212 billion, will come from affiliate sites.” To date, the majority of businesses have focused on click throughs and impressions to drive their online marketing effort. Affiliate marketing, and its results-driven payment system, provided the Virgin Mobile marketing team with an accountable and measurable marketing spend and qualifiable results. Upfront costs associated with techniques like banner advertising and tenancy deals were not feasible especially with conversion rates decreasing and becoming less of an importance for many sites. Forrester Research has predicted that online marketing budgets, which include techniques like affiliate marketing, will account for up to 50% of advertising budgets by 2003 (Forrester Research 2000). Campaign Objectives and Goals: In our expert opinion, Virgin Mobile required an affiliate marketing solution which enabled them to analyse and manage individual relationships with their channel partners on a active and continuous way. Key campaign objectives: - To build and establish long term relationships with over 200 significant affiliate sites in the following vertical categories: - Large portals, mobile telecom sites, finance sites, music sites, lifestyle and student portals - To secure a sales conversion ratio above the industry standard of 1% - To retain a relationship rate in excess of 50% - A lower than equivalent banner ad cost - To build a database, generate leads, increase brand awareness and learning How MagicButton.Net assisted Virgin Mobile to meet their objectives: Working with MagicButtton.Net gave Virgin Mobile access to a team of affiliate marketing consultants, ensuring delivery and development of their affiliate marketing campaign in the most efficient way possible. It was an easy choice for Virgin Mobile to outsource their entire strategy and implementation of the their affiliate program to MagicButton.Net, because it gave them the time to focus on other marketing channels and company objectives. The ‘MagicSolution’ consultancy team worked with the Virgin Mobile group on strategising and planning the following: · A competitive appraisal of other mobile providers: how they use online marketing techniques including affiliate marketing, to drive their online channel · Key proposed commission models which reflected higher than average market rates (the current average commission in affiliate marketing is between 7-8%) · Identification of 500+ affiliate partner sites from 5 vertical categories (these sites where predominately either large traffic drivers or industry leaders) · The development and coordination of the merchandising of Virgin Mobile’s virtual pages (pages which end-users see when they click on a magicbutton or link which presents a contextual environment increasing the chance of converting browsers to buyers) · Creation of a monthly communication strategy with their affiliates which is key to retention and motivation The MagicButton.Net consultancy services have enabled businesses like Virgin Mobile to meet their marketing objectives more efficiently without having to invest in the technology and time to gather the expertise. Evaluation: MagicButton.Net succeeded in facilitating over 250 strategic (long term) online marketing partnerships for Virgin Mobile in phase one. Some key learning was done which has been fed back into the program to increase performance. Top performing affiliates in the Virgin Mobile Affiliate Program have delivered conversion rates in excess of 2%. After thorough analysis of these leading partnerships, we have concluded the following key performance factors: · To focus on contextualization of buttons on relevant affiliate sites. It was clear from processing the button analysis report with Virgin Mobile, that product specific promotions surrounded by content which endorse the promotions, produced conversions in excess of 2% · Button size and call to action promotions deliver greater click-throughs · Using ‘deep link’ buttons to relevant pages in the Virgin Mobile eCommerce site, improved effectiveness of promotions · Motivating affiliates with higher than average commission structures ensured better link placement. Affiliates are clearly attracted to the upside of revenue sharing vs. the CPM revenue model · Weekly monitoring of partnership statistics by MagicButton.Net enabled Virgin Mobile to concentrate on pushing and maximising the best partnerships · Providing monthly communication informing affiliates with the latest offers, creative links, incentives and promotions greatly helped achieve the retention rate of over 50% for selective top partnerships About MagicButton.Net: MagicButton.Net is a UK based, European affiliate marketing solution provider (MSP) with a mission "to help its customers to acquire, convert and retain customers easily and cost-effectively online using performance based marketing methods such as, affiliate marketing, email and search engines." MagicButton.Net currently provides marketing solutions and services to leading UK and international brands including: British Telecom, BCA (Bertelsmann Group), Virgin Mobile, Genie Internet, Ted Baker, Comet, B&Q (eKingfisher group), Littlewoods, People’s Bank and Domino’s Pizza. MagicButton.Net Number One, Third Floor Harbour Yard, Chelsea Harbour London SW10 0XD Phone: +44 207 349 4270 Fax: +44 207 349 4275 Email: sales@MagicButton.Net This press release was distributed by ResponseSource Press Release Wire on behalf of MagicButton.net in the following categories: Consumer Technology, Personal Finance, Business & Finance, Computing & Telecoms, for more information visit https://pressreleasewire.responsesource.com/about.