In 2009 Red Letter Days set itself the challenge of delivering the best affiliate incentive programme in the market. The key measures of success were to make it available to all affiliates, ensure the incentives were highly achievable and to deliver to a target ROI. The result was a quarterly incentive scheme combining compelling prizes with an innovative approach. By rewarding affiliates based on their own performance rather than requiring them to compete against each, Red Letter Days demonstrated understanding that a successful affiliate programme should treat affiliates as individuals. The incentive scheme was key in exceeding sales targets.
Objectives
- Motivate all affiliates, large or small, to lift sales into a higher sales tier
- Motivate new affiliates to grow their performance as quickly as possible
- Maintain long-term interest in the Red Letter Days programme in between key gifting occasions and combat seasonality drop-off
- Increase the contribution of affiliate sales to overall web sales
- Deliver a significant uplift in affiliate sales from 2008 to 2009
- Ensure that the cost of the incentive programme was delivered on target
Strategy
Incentive programme structure, Q1-Q3 2009
The primary aim was to reward a broad spectrum of affiliates of all sizes and types, rather than simply rewarding top performers or limiting rewards to a small amount of recipients; smaller affiliates can significantly uplift performance with the right tools and recognition, while larger affiliates could be incentivised to invest greater amounts of time into Red Letter Days above competitor programmes.
The model adopted was to offer guaranteed prizes for hitting various sales tiers, starting at just £1,000 per quarter from Q1-Q3 and £1,500 in Q4 (around 8-12 sales), ensuring that prizes were well within the reach of every affiliate.
The quarterly incentive scheme was communicated to affiliates via the a4u forum, network email, the Red Letter Days affiliate blog, via new affiliate sign-up emails and on network signup pages.
Execution
2009 Q4 incentives – the crucial Christmas gifting period
Following the success of Q1-Q3 2009 it was recognised Q4 2009’s incentive scheme would have to be the best yet including, in addition:
- All affiliates who hit £1,000 worth of sales received a hamper delivered in time for Christmas.
- Three holiday prizes
One of the city breaks was given to the affiliate judged to have produced the best Red Letter Days landing page, while the other was drawn from a pool of the top 5 most improved affiliates and the top 5 best new affiliates signed up after 15 September 2009. Winners were announced via videos posted onyoutube
Feedback for Red Letter Days’ Christmas incentive was hugely positive and received blogger’s praise.
Results
- The contribution of affiliate sales to overall web sales more than doubled.
- The affiliate revenue uplift was nearly threefold.
- Affiliate revenue in 2009 was significantly above target
- The cost of the affiliate incentive programme was well within the objective.
- Successful elevation of a number of affiliates from mid to top performers.