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CASE STUDY: PLAY.COM

Imagine a world in which every company that played a part in driving a customer to your site had to be rewarded financially. Depending on which side of the divide you are on, this vision is either utopia or the stuff of nightmares. For brands, which may have to shell out to all these companies, it is an intimidating concept, considering how many visits and routes a customer might take to a site before they finally make a purchase.

Yet where affiliate marketing is concerned, this is exactly what would happen were it not for deduplication. Currently, with affiliate marketing the general rule is: last click wins. This means the only affiliate to receive commission on a sale is the last one the customer clicked through from - within a 30-day period. Deduplication enables retailers to pinpoint this last click.

As a useful by-product, deduplication also enables a brand to see which channels are the most successful in driving sales - good information to have when apportioning channel spend. Yet while many companies that use affiliate marketing, particularly the larger ones, have a strategy for this in place, many more don't.

Whether the 'last click wins' rule is the fairest way to reward affiliates is a moot point, but there is currently no accepted standard for paying affiliates for their part in driving a sale, and this rule protects the seller from having to pay the same commission to everyone. So how is it done?

For online retailer Play.com, it works like this: Play has thousands of affiliates, managed by three networks - Affiliate Window, Buy.at and TradeDoubler - all working to drive customers to its site. On top of this, Play, like many e-tailers, uses a number of other forms of online marketing, including banner advertising and paid search. "In terms of our marketing mix, we use affiliate marketing, paid search where Google takes the lion's share, shopping comparison sites, which we're now trying to recruit as affiliates, and banner advertising, which has been successful at some times and not at others," explains Richard Chapple, Play.com marketing manager.

It means that a customer could come to a site via any number of these routes. For example, he might first visit Play.com via Google. While he would be more likely to go straight to the site next time, he might instead return a couple of days later via Nectar, yet not complete a transaction until his third visit, when to find Play this time, he clicked on a banner ad on another site entirely.

To enable this activity to be measured, each affiliate directs traffic through to its own affiliated URL link, and every time a customer visits Play.com, a cookie is uploaded, which tells Play where he clicked from. Without a deduplication programme in place, once the sale was complete, every cookie would show up, and Play would have to pay commission to all of the referrers. Through its deduplication strategy, each cookie overrides the previous one, so when the customer finally buys that Bob Dylan CD, Play only sees where he came from that last time, providing it is within the 30-day window, and awards the commission for that particular sale to that company.

Play uses its own system to manage its affiliate marketing and this also generates reports that not only show sales but highlight any fishy behaviour - such as a sudden purchase of 100 plasma TVs. In addition, the system will show any sales a network has picked up that Play hasn't, which might indicate a dropped link that needs fixing. Any oddities like these are then checked manually - to see whether that bulk purchase was genuine, or whether a sale that Play hasn't recorded went through, and if not, why not.

An automated system is vital when dealing with the click volumes Play deals with on a weekly basis. To give an idea of figures, last September, Play got around half a million clicks a week, with an average conversion rate of about ten per cent. Problems, however, are few and far between, according to Chapple: only about 30 a week need investigating.

What makes Play stand out from the crowd is its use of three networks. Until December 2005, it was working with only two - TradeDoubler and Buy.at - but felt another could add value in the shape of extra business, and this is when Affiliate Window came on board.

Affiliate Window has more than 57,000 registered affiliates in the UK, ranging from major shopping comparison sites PriceRunner and Kelkoo, which form a large part of Play.com's business, to customer loyalty firms including AirMiles and Nectar, as well as smaller, niche sites.

While the multiple network set-up works for Play, this might not be the case for everyone, says Michelle Boxall, key accounts manager at Affiliate Window, who has experienced the other side in a previous job. "When I was client-side, we got a second network and saw hardly any incrementals from it," she says.

Managing multiple networks also has the potential for more complications in terms of tracking that last referrer. This is where a good deduplication strategy really pays its way in ensuring all cookies are properly tracked and overridden where necessary. Dealing with multiple networks does however mean that communication is key. While all three are in direct competition, Play is keen to be as transparent with them all as possible, and as a result has taken a couple of measures to ensure its affiliate programme runs smoothly.

First, it appointed an online marketing manager to be the first point of contact for all three of the networks, which has eased the communications process, and secondly, it developed an extranet that ensures all three have access to everything at the same time, so Play cannot show any favouritism. "It's a level playing field," says Boxall.

Play has also been brave enough to get all three networks together in the same room for a review meeting. "Late last year, Play had all its networks and managers in, and did a showcase on what they were doing, with stats on how much business we were providing them with and what it wanted us to focus on moving into 2008," explains Boxall. "We may be in competition but it is great to all come together like that."

CASE STUDY: COMET DEDUPLICATION

In electrical retailer Comet's case, there is only one affiliate network to deal with, Affiliate Window. But although this network manages tens of thousands of affiliates, and although Comet also participates in a number of other types of online media, this doesn't make deduplication any less crucial than it is for a company such as Play.com, which has three networks.

Under the standard 'last click wins' rule, when a sale is made, Comet needs to identify the channel it came from, and who the last referrer was, so it can award the commission for that sale to the right company. "Deduplication is very important - for the benefit of our affiliate merchants as well as for ourselves," says Robin Chan, marketing and research manager at eComet. "We don't want to pay too much but we also recognise the hard work affiliates do for us and we want to justly reward those who bring the sales in."

Without a deduplication strategy in place, one sale would register multiple times depending on how many routes and visits a customer took to that site before they committed to buying.

"Comet uses deduplication so there is no overlap from sales," says Ross Truesdale, key account manager at Affiliate Window. "The user may have clicked on our link and also on an email from Comet, both of which will have registered so without deduplication, it would show two sales rather than one."

To ensure no more commission is paid out to its affiliates than it should be, Comet gives each affiliate and media its own tracking link with a Coremetrics tag that enables the retailer to track where that traffic has come from. This is supplied by Comet along with the latest campaign creative and data feed.

When someone visits the site from elsewhere, their web browser is sent a cookie that holds information on where that person came from and what they did on the site, ready for the next time they go there. Comet uses Coremetrics analysis software to track these cookies, and see when they were uploaded, and then dedupes to cancel out all but the last one to ensure that this is the referrer that wins the commission.

"In the affiliate world, a user tends to click on a quite a few different sites," says Truesdale. "This information is automatically uploaded on to the system. Without deduping software, it means a number of sales would show up, and they would have to go through them manually to look at when the last cookie was uploaded."

On at least a weekly basis, Comet reviews its validations and makes sure the right companies are rewarded for their efforts. "We can validate the sale - see what product has been purchased, through what channel, and where the last click came from," says Chan.

Once a sale has been validated, this is cross-referenced against Comet's system, and the commission paid to the relevant party. In addition, daily monitoring is in place to check for discrepancies, such as extreme sales volumes.

Working with a network has its benefits for Comet. While it does maintain a one-to-one relationship with its top affiliates, this is impossible to do for all the thousands on its books and this is one of the many areas with which Affiliate Network helps. "If you deal with a huge number of affiliate partners like we do, it would be hugely difficult to maintain a one-to-one relationship. Where Affiliate Window can help is in maintaining those relationships, and also in recruiting new partners," Chan says.

So where does deduplication go from here? Affiliate Windows has its theories: while 'last click wins' is the rule now, there is some debate over whether this a fair way of remunerating affiliates for their work. Communications director David Hall can see an alternative. "Dividing the reward into the chain of companies involved is possible," he says. "You could do it on time: one minute on Google, versus ten minutes on an affiliate, and divide it proportionally. This is the future."

It would, however, take a lot of work. "It makes partnerships very difficult to manage - you have to decide what and when you are prepared to put in a proportional representation." So, for now, it looks like it is fingers on the button: last click wins.

TOP TIPS FOR DEDUPLICATION STRATEGY

- You need to dedupe your sales if you are running a range of digital marketing activities and/or you are running multi-network affiliate programmes.

- To dedupe sales, you need a technical solution that will identify the original source of the visitor. This solution should be freely available from your affiliate network provider. If you are carrying out a variety of online activity, you risk paying more than once for the same sale unless you run all the tracking through one coordinated solution.

- Dedupe solutions typically add information on to the click-through URL to your retailing website, identifying the 'referrer' channel. Subsequently, if the customer is sent back to your website by one of your other channels then the local cookie should be overwritten by the conditional tag. This identifies the last referring advertising channel.