Affiliate channels generate the highest returns of all of 7 For All Mankind’s digital marketing channels, Nicole Goldberg, digital marketing manager for Delta Galil USA Inc., the denim retailer’s parent company, tells Internet Retailer at Rakuten Marketing’s Dealmaker conference in Scottsdale, Arizona, this week.
The brand dedicates 10-20% of its digital ad budget to affiliate marketing, Goldberg says. While 7 For All Mankind spends the majority of its digital ad budget on other channels, such as paid search, display and social media, affiliate marketing consistently generates a 10-to-1 return on its ad spend, which is much higher than its other channels, Goldberg says. The brand uses a last-touch attribution model, meaning the traffic source immediately before the purchase is the one that gets the credit for the sale. Goldberg attributes the affiliate channel’s high return on ad spend to the nature of the shoppers in that channel.
Affiliate networks, which can also be called publishers, are wide ranging in types and services. Some affiliates are discount sites, such as eBates, or browser extensions like Honey, in which shoppers can browse for discount codes, sales or cash back. Some affiliates are more content focused, such as TheWireCutter.com, which reviews products, or Popsugar.com, which provides entertainment news. Others are more targeted, such as Allume.com, which has a stylist pick out apparel and accessories from different retailers and put together looks for a shopper to buy. All of these networks/publishers receive a commission from the retailer if a shopper buys using the affiliate link.
7 For All Mankind has about 50-70 approved affiliates in its network, but it only works closely with about 15 of them, she says. The brand uses Rakuten Marketing to manage its affiliate network.
“With affiliates, there is such a high intention there,” Goldberg says. “You are going to the publisher with interest, and [the publisher] is giving them product recommendations, or the best deal or whatever is niche that interests those consumers, and there is a built-in trust there with that publisher.”
In contrast, with paid search or social media, 7 For All Mankind is putting its ads out across the internet, hoping that the shopper has the intent to buy in the moment she sees the ad, when the shopper may or may not be ready to buy yet, Goldberg says. Plus, with affiliates, 7 For All Mankind can create exclusive deals offered to a narrow audience, tailored to that affiliate network. For example, if a publisher knows that its audience really likes feminine products, 7 For All Mankind would feature a deal for more feminine-cut jeans or for its dresses. On Google, its isn’t as easy to be as targeted.
And, through deals the brand has worked out with publishers, shoppers are directed to 7ForAllMankindJeans.com to purchase, and not another retailer that sells its products.
“We would all like to think that our most loyal customers are only going to be shopping with us, but at the end of the day, it’s a crowded marketplace,” Goldberg says. “You can get good quality jeans from a lot of places.”
And that includes all of the brand’s wholesale retailers. “We love our wholesale partners and there is no problem with you shopping from them, but, of course, I think you are going to get the best brand experience shopping with us,” Goldberg says.
Overall, the retailer measures its affiliate program’s success if it is having positive comparable growth year over year and driving a return on ad spend, she says. Which, they are, she adds.
Although affiliates generate the highest return on ad spend, managing relationships with all of its publishers is time intensive, she says. For example, the retailer’s account manager checks in weekly or sometimes daily with its affiliate partners preparing for upcoming promotions.
One challenge of affiliate marketing is profitability. For example, sometimes an affiliate channel may have an additional deal that shoppers can use on top of a sitewide promotion, such as a friends and family discount. For this reason, Goldberg spends time evaluating its promotions to ensure she can still hit her profit margins with additional coupons in the market.
“[Profitability] is something that we have to track,” she says about affiliate marketing, which is not something she needs to pay as close attention to with other digital marketing channels.
But at the same time, the retailer knows that a lot of shoppers won’t buy unless they feel like they are getting a deal. Or don’t want to buy if they think they are getting swindled. In that case, the retailer doesn’t mind offering free shipping if it means getting a first-time shopper to purchase and getting the opportunity to grow that shopper into a repeat customer, she says.
Future of affiliates for the retailer
7 For All Mankind is hoping to further develop its affiliate marketing efforts in two areas, she says. First, the retailer would like to expand more into the brand exposure—the “upper funnel” side of affiliate marketing, such as influencers and content affiliates which it does not do now. And secondly, the retailer would like to use affiliates to target shoppers who have previously bought from 7 For All Mankind but have not in a few years. While these are technically “repeat” shoppers, these shoppers have “churned” and may need a reminder the brand still sells quality denim, Goldberg says.
For repeat shoppers, the retailer is now working with Rakuten Marketing to use more of its tools that can serve different deals based on if a shopper is a new or repeat shopper.
On the content side of affiliate marketing, 7 For All Mankind is working with its PR team and publishers with affiliate networks to get its brand in front of more consumers. It is working on adjusting its commission rates for different publishers. For example, on deal and coupon sites, the brand’s commission rate is about 4%. Because these affiliates, like eBates, drive so many sales for the brand, the commission is lower. However, for an influencer or content affiliate piece, like an online article, the commission rate is usually higher, and more likely to be a double-digit percentage, she says.
The retailer also is working on taking advantage of more affiliate opportunities. For example, People Magazine recently published a spread online about how 7 For All Mankind jeans were popular with celebrities. The article, Goldberg says, linked to several retailers that sell 7 For All Mankind’s jeans. However, it did not contain an affiliate link directly to 7 For All Mankind’s site because the brand did not have a high enough affiliate commission rate, she says.
So as not to miss out on those opportunities in the future, the brand is now testing a higher commission rate with a publisher for an upcoming spread in a magazine, Goldberg says, declining to reveal specifics.
This year marks 7 For All Mankind’s 20th anniversary. The brand’s “heyday” was 2003-2007, when it had a large customer based and experienced strong growth, Goldberg says. Sales began to plateau after that for various reasons, she says. In 2016, Delta Galil acquired the brand from the previous owners VF Corp. The new ownership, helped spur changes and growth, she says. More attention and resources, such as a new ecommerce team, gave a fresh perspective to the brand, she says. In 2017 and 2018, 7 For All Mankind had very positive growth, Goldberg says, without sharing specifics, and it hopes to continue with those positive year-over-year sales gains.Favorite