A few years back, I was working with a technology company who had ran a multi-billion dollar b2b affiliate marketing programme. The deal was simple — integrate their brand into your advertising, and they’ll cover a percentage of your media costs. The greater the integration, the more they’d cover, up to a very significant percentage. The program was hugely popular and successful, and helped make the technology maker ubiquitous as a brand.
At one point I had an idea — what if we extended this programme to consumers?
I was salivating over the marketing and commerce potential of widgets, and the pioneering Amazon Associates program, founded in 1996, already had over 200,000 members.
The idea was never implemented, possibly because of how much effort is involved in setting up affiliate programmes, and how many company silos something like that crosses. However I’ve always thought that there was massive potential in the idea. As marketers we’re saying that consumers are providing brands with “earned media” by getting them to install cool and useful widgets on their spaces, thereby getting our brand in front of their and other people’s eyes without any further media investment. But what if we gave them the option and incentive to also monetize that space, like a real media owner?
If they could place products they’d recommend into their pages, and get a cut every time the product sold, that could be big.
Fast forward three years, and Amazon is now up to 900,000 members in their Associates program, who can make up to 15% on sale referrals through both affiliate links and an easy use widget, customizable to include any range of items from the Amazon catalog.
But still, besides a few innovative music startups basing their business model around the idea of social commerce, I’ve seen little in the way of brand innovation in the space.
Until now. This week, Dominos’ launched a social affiliate programme for pizza sales.
The concept is simple. Install the widget on your blog or social networking space. Any time someone purchases through the widget, you get a 0.5% cut from it. There’s even a dashboard to track your sales.
I’m not sure if 0.5% is enough to get most people to stick a pizza widget on their social spaces. But people definitely use brand names and assets on their social spaces as status indicators. And if they could get a cut from referrals of the latest thing they like, covering anything from brands to bands, I’m sure some would.
I referenced a few other innovative startups in the music space trying out an affiliate model, they are:
mflow
Currently in private beta, mflow allows you to follow people who’s music preferences match your tastes. Every time you buy one of their recommended tracks, they get a 20% cut. And the same deal works for you.
Posse
Based out of Australia, Posse lets fans choose upcoming gigs they like and post links to the concerts anywhere from emails to Facebook. Anytime someone clicks through and buys a ticket (handled via Ticketmaster), they get a portion of the sale straight into their PayPal account.
So what do you think? Is Domino’s still ahead of the curve, or is social commerce and affiliate marketing 2.0 well and truly on its way?
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Interesting concept, but to me this is the same as Amazon’s affiliate program and lacks any social element. A shareable widget does not necessarily make this ’social’ commerce.
Dominos concept is only interesting for people who can hit large numbers with their site - having a friend buy a pizza through my link every once in a while barely buys me a pint at the end of the month, so it’s not worth the hassle.
I’d argue that social commerce is actually more like the Amazon recommendations than its affiliate program - but with these recommendations being based on what your friends have bought, rather than strangers.
Facebook Beacon would have been the next big thing in social commerce, were it not for their lax/misguided attitude towards privacy.
Profit sharing, like Dominos does, could actually cheapen the idea of ’social’ commerce and recommendations from friends. I trust my friend’s opinion, but how does him being paid affect my opinion of his recommendation?
Social commerce will be about shared buying/shopping experiences, not about people making money from their WOM.