Here's a great lesson on why affiliates need to pay attention to merchant emails and also why it pays to always have a plan B in this business. If you are doing PPC for Walmart and missed the email, you could lose your shirt!
<strong>Walmart</strong> just announced an affiliate pay cut. For example clothing was cut from 12% to 4%. Electronics paid 6% now only 1%. Books and photo dropped from 8% to 1%. Previous overall commission range was from 5-12%. Now it's only 1% - 4%. That's a HUGE decrease and I'm sure lots of affiliates are upset and rightly so.
Granted Walmart has tons of brand recognition and low prices - hence low margins, but that's just too big of a reduction to even consider fair or reasonable, if they value their affiliate channel at all.
Marc Quarles blogs about the <strong><a href="http://marcquarles.com/77/the-death-of-wal-mart">The Death of Wal-Mart</a></strong>. Marc talks about an Amazon product he was spending $12 in PPC on to make $28.17 in commission. The commish on that product will now be reduced to $4.61. So he has no choice but to pull campaign or switch links to Amazon which is still fairly low paying, but looks pretty good now in comparison. <strong>Marc writes:</strong>
<blockquote>"So, what?s the moral of the story? Always have a plan B. Remember, when you?re in the affiliate marketing game, your income is controlled by other entities. One stroke of the pen could devastate your income, so always have a backup plan, and pay attention for changes such as this.
I?d hate to guess how many affiliates are going to lose their shirts because they didn?t pay attention to Wal-mart?s email, and continue spending $12.00 to make $4.61."</blockquote>
<strong>I wonder if they'll re-think this strategy if the Walmart.com WMT stock plummets due to a decrease in sales? </strong>
Maybe the affiliate channel just didn't generate much for them. But then again maybe the last paragraph of this post has the answer. <strong><a target="_new" href="http://opmweb.com/b2bmarketingblog/?p=27"> WalMart: Downsizing Affiliate Marketing</a></strong>
<strong>Walmart</strong> just announced an affiliate pay cut. For example clothing was cut from 12% to 4%. Electronics paid 6% now only 1%. Books and photo dropped from 8% to 1%. Previous overall commission range was from 5-12%. Now it's only 1% - 4%. That's a HUGE decrease and I'm sure lots of affiliates are upset and rightly so.
Granted Walmart has tons of brand recognition and low prices - hence low margins, but that's just too big of a reduction to even consider fair or reasonable, if they value their affiliate channel at all.
Marc Quarles blogs about the <strong><a href="http://marcquarles.com/77/the-death-of-wal-mart">The Death of Wal-Mart</a></strong>. Marc talks about an Amazon product he was spending $12 in PPC on to make $28.17 in commission. The commish on that product will now be reduced to $4.61. So he has no choice but to pull campaign or switch links to Amazon which is still fairly low paying, but looks pretty good now in comparison. <strong>Marc writes:</strong>
<blockquote>"So, what?s the moral of the story? Always have a plan B. Remember, when you?re in the affiliate marketing game, your income is controlled by other entities. One stroke of the pen could devastate your income, so always have a backup plan, and pay attention for changes such as this.
I?d hate to guess how many affiliates are going to lose their shirts because they didn?t pay attention to Wal-mart?s email, and continue spending $12.00 to make $4.61."</blockquote>
<strong>I wonder if they'll re-think this strategy if the Walmart.com WMT stock plummets due to a decrease in sales? </strong>
Maybe the affiliate channel just didn't generate much for them. But then again maybe the last paragraph of this post has the answer. <strong><a target="_new" href="http://opmweb.com/b2bmarketingblog/?p=27"> WalMart: Downsizing Affiliate Marketing</a></strong>
so Amazon here I come. Always have a backup plan. I saw the email, said a few choice words, then decided to move on.
