impact.com and Ragtrader brought together some of Australia’s leading fashion retailers to discuss how affiliate marketing can unlock opportunities across the purchase funnel.

Chaired by Ragtrader publisher Assia Benmedjdoub, the panel included David Jones CMO James Holloman, P.E Nation global head of brand and marketing Sara Lloyd, The Iconic director of brand, media and comms Georgia Thomas, Country Road Group digital marketing manager Katie Larkins, M.J Bale head of digital and ecommerce Marnie Goss, InStitchu head of marketing Robert O’Reilly, impact.com marketing manager ANZ Laurence Nelmes, impact.com ANZ director of customer success and sales Helena Barroso Zarco and impact.com enterprise account executive Megan Armfield.

Assia: Katie, what role does affiliate marketing play in your overall strategy at Country Road Group?

Katie: When we look at our funnel, our affiliates program is very much a lower funnel conversion piece for us. We’re early in our affiliates journey and we have only tapped into the first bit of it, which is driving those sales at the very last touchpoint. There's a lot of room for us to grow. At the moment, it's just very much a sales driver and a push to purchase in amongst our other channels. We really lean on paid social and then more traditional channels to drive our awareness, traffic is typically a search job and then affiliates will be sales.

Assia: What percentage of your marketing spend does it make up?

Katie: A very small percentage at the moment. I'd say in our media budget, it is maybe between 10 per cent and 15 per cent, which we'd like to see grow. It has been the strongest for us of any of our channels. We are leaning on that to push for a bit more budget, across the group and our comms media. Affiliates always returns the strongest, so we’re definitely looking to build that over the next few years. Our main partners at the moment are LTK, Qantas and Marie Claire.

Assia: What’s the scope of The Iconic’s affiliate marketing program, Georgia?

Georgia: It plays a big role. We have over 150 partners that we work with. When thinking about answering this question, it absolutely does have a role in that bottom paid intent space, but it also has a really important role up the funnel. Especially when it comes to native content and really trying to dial up how people feel before taking an action. So, we're in a bit of a transition, probably similar to you Katie. We've just relaunched our brand and we're working on how we actually use our channels in a more balanced way. I think we've been using affiliates probably too much from an intent-based performance role. Yes, absolutely it does the job. But I think we need to start thinking about how it also fits in that top and full funnel, particularly when it comes to content and publishers. We have an amazing partnerships team that we work closely with for affiliates, partnering with like-minded brands to come up with commercial solutions. Affiliates form quite an important part of that. We actually use them for our own marketing too, which is exciting. They fulfill quite a few roles for us, and I see them doing more and more going into the future.

Assia: What are some of the key affiliates for The Iconic?

Georgia: Elle, Qantas, Reward Gateway and Unidays are just a selection.

Assia: Is it a similar spread over at M.J.Bale, Marnie?

Marnie: To name a few, we use CashRewards, Reward Gateway, Shopback together with Qantas, Skimlinks and Unidays. Our affiliate program has really been a bit of a quiet achiever. It hasn't traditionally been given a lot of love and attention from within the business. That focus has generally tended to go to our paid search and paid social channels but the affiliate customer does drive significant revenue. We have always taken a lower funnel approach with affiliates and we've just shifted that to focus more on mid and upper funnel. We have started to look at our affiliate partners and clean those up a little bit, perhaps getting rid of some of those more opportunistic customers and focusing on more of the long-term higher value customers. It's really been a mind shift change within the business as well because we tend to rely on affiliates for that quick revenue when times are tough. So, it's really getting the business to focus on customer acquisition and that upper funnel piece as well. 

Assia: What percentage of your overall marketing budget is allocated to affiliates?

Marnie: Really small, like it's less than 10 per cent.

Assia: And is that something you're looking to grow?

Marnie: Yes, absolutely. We've just done a really big deep dive analysing the data of our affiliate customer and they're more valuable than our other customers. They spend more, they come back more. So, there really is a big opportunity there.

Assia: How do you vet the affiliate partners?

Sara: Trial. Trial and optimise. We want to get more agile in moving percentages and offering higher commissions at certain times. Again, this is just an area of the business we've recently started getting under the hood of. It has felt like a little bit of a set and forget in the business for a long time and that's down to resources really. Someone having their eye on it week in, week out. It’s also identifying full price trading periods versus when we're going into sale periods and really turning things on and off. Or if we're doing a big press push organically, how can we incentivise the editorial partners to do more? What’s been interesting for them is going in this cost per click rather than revenue base. We were a little apprehensive about that at the start. But the clicks are quite small, so it's important for us to work out what more that press can do for us in our own channels, where it gets broadcast further. We're very much trial and error, looking for the wins and we'll go down those paths when we see them.  

Assia: How does David Jones vet affiliate partners, James?

James: We've got a very select group we work with. I think it's about brand reputation and where you show up. There's a big thing we probably need to talk about today that Sara has touched on, which is the resourcing required for affiliates. There is a huge back-end piece on sites, in my case, to create a catalogue that might be appropriate for that particular affiliate channel. So, whether it's ‘best in resort wear’ or ‘dressing for a wedding’ or ‘styling your home’, someone has to create a whole edit that goes behind that. And you've got to work across your merchandising partners and your supply chain to make sure that all of that is there, as well as your finance partner. So there is that element to this channel. It almost seems like a magic channel where you get all these amazing sales very quickly, but there is more resource required than just popping something in a paid search model through Google. I think the resourcing piece is a big thing and that is another reason why core partners are important to us.

Assia: How does P.E Nation manage resourcing affiliates as a smaller business?

Sara: It's something that we're working through at the moment. We have the digital team looking after most of the performance affiliates and then we have the brand team looking after the editorial and creator publishers. Anywhere that we're coming together, like on Unidays, we might work outside of silos and see what other marketing and brand activity we can layer on top.

Assia: In terms of the measurement piece that's come up quite a few times, how do you approach that?

Sara: ROAS is a big one obviously if it's intended to be bottom of funnel. That is plain and simple. Thanks to our new CEO Hamish Stuart, we have a really great investment in brand at the moment which is an amazing. Where top of funnel doesn't give you as high a ROAS on its own and in isolation, we try to make sure that an outcome from that can stretch further. We can sweat those assets. We might share a piece of press on our Instagram, which then hits 300,000 people. Then we might pin it to highlights or we put it in our brand book, which helps us negotiate a new partnership. We just try to make sure any crumbs that we do get, we can just flex them a lot more.

Marnie: The mid and upper funnel investment is really still in a test-and-learn phase for us at M.J Bale. We don't really have enough data yet to measure the success of them. We obviously put really different metrics against them than we do on those lower funnel, which is purely ROAS driven.

Assia: Is that a similar measurement approach at Country Road Group, Katie?

Katie: I think we're in a very lucky spot where we have a lot of measurement available, both from our platform and also our in-house data teams. I think our area for growth is really translating it back to business. We're trying to distil these metrics to something that's digestible and easily seen. We lean a lot on ROAS for our performance campaigns but similarly, we're trying to move into more like a traffic objective where we can KPI that at a benchmark.

Assia: Can you share a recent successful campaign in that space?

Katie: It is still very new. But our most successful campaigns have always been the conversion-based. We’re very much in the early journey of mid to upper funnel.

Assia: What's your process for vetting at M.J Bale?

Marnie: To be honest with you, I work really closely with our brand team with vetting. We found that we started ending up in some random places that we didn't really approve of and it was just really making sure that every partner that we work with is approved. It goes through our brand team to make sure that it's on brand. Rather than going quite wide, it’s working with a few key select partners and really scaling it back, just to make sure that we are on brand.

Assia: Sara, you mentioned that you have worked with domestic and international affiliate partners. How does your utilisation of partners change?

Sara: It's very new for us. I think we've largely been led by wholesale and our relationship with our sales agents globally to this point. But we've definitely got a few team members internally that are now focused on our different priority markets, which are the US and the UK. I think they’re a bit more advanced than our local market, with the US probably about three to five years ahead of us. I'm hoping that we can keep improving there, but we only have a US website at the moment so that will probably be our next focus.

Assia: Why do you think the international market is so much further ahead than Australia?

Sara: I don't know why. I remember when I was at General Pants, I was trying to sell the idea of affiliate into a publishing house and there wasn’t the uptake. Who What Wear was a great example. They came here, they launched it and then that model didn't work here as well. Publishers that have connections internationally started to pick it up first, learning from their counterparts, and then they became more comfortable with it.

Assia: Katie, what are your thoughts on that?

Katie: Yeah, it's such an interesting one. We're having a similar conversation at Country Road Group and again, we come back to our strategy and the objective of a particular affiliate. We've had a lot of conversations about new customers and affiliates versus existing. I think similar to what you said, it depends on the partner, depends on the strategy, the funnel.

Assia: How are you addressing that question, Sara?

Sara: I think discounting is where it came down to being a dirty word. There was a time when even 10 per cent or 15 per cent off was really looked down upon. Now we're going into Black Fridays and it's like starting at 40 per cent. So, I think we've come a long way to the customer almost expecting that little bit off the top. And the brands that aren't giving that little 10 per cent or 15 per cent, is that deterring people from choosing them? Potentially. So, that's where we see the benefit in those little discounts.

Katie: We're revisiting, based on that exactly. We have moved away from a lot of the cashbacks but there a lot of brands on there. Are we losing out because everyone else is doing it and they're choosing to shop there? I'll let you know when we find out.

Assia: How do you go about vetting content created by affiliates, James?

James: I think because we select a bespoke set of affiliates as publishers, that helps us. I'll swing the other way and say that in terms of creators, obviously we have brand safety top of mind. We have a brand playbook. But we're also okay giving creators a little bit of control. They know what resonates with their audience and as long as it’s all within the brand safety guidelines, we welcome it. We’ve actually seen really good commercial results from content we wouldn't have produced ourselves, which is the point. If I want to acquire new customers, I would be talking to people in a new way.

Georgia: We have ten owned-labels and we see the best commercial results through influencers injecting their own brand into the content. In terms of vetting, we use LTK and they’re brilliant.

Assia: How do you vet at M.J Bale, Marnie?

Marnie: We work with an agency partner as well and they were initially doing the vetting process, but we actually brought it in internally. Purely because we started seeing ourselves in places we didn't want to be. Everything gets approved internally now and I work really closely with our head of brand to go through that vetting process. And yes, there is an element of letting go of control. What James mentioned before, sometimes you have to let go of a little bit of control because that's actually what gets you the results that you need.

Assia: How do you see the role of affiliates evolving in your overall marketing strategy in the next three to five years?

Rob: I think that the challenge for us is mostly around resourcing. It's just a matter of having the skills and the experience and just the hours in the day to do it properly. I suppose before we dive in too heavily and really invest in the resourcing side, we need to make sure we've got the right strategy in place and we're isolating the right opportunities and then putting the headcount to back that up.

Katie: I think in the next few years for us, we would love to see it run full funnel as other channels do at the moment. To grow the budget and see it spread across awareness strategy right down to sales, and then even retention, would be where I'd love to see it.

Georgia: For us, we know what works but it's the influencer and content creator space that I think is still unknown. It should be unknown because it's down to people and personalities. We want to ride that with the right people and be more brave in that space as well. The other thing we haven't really talked about with the editorial side of things is that this type of marketing can help smaller publishers as well. I'm a big advocate of the poor publishers that are struggling with the likes of what's happening with Facebook. Affiliate marketing helps those smaller, more engaged publishers and how we they can flip that conversation in the market to talk about engagement as well.

Sara: It's with Uber now too.

Georgia: We’re doing quite a bit with Uber at the minute. That is a commercial partnership aimed at driving membership of their loyalty program Uber One. We worked with them on Fashion Week and created a bespoke piece of content that talked to the benefits. But when you downloaded the app, you also got a 10 per cent discount with The Iconic and it was self-fulfilling. We use their media channels to then advertise The Iconic and it was a great partnership. It was commercial, but the value-add was huge for both of us. That's a really good example of when brands are relevant to each other, like fast delivery.

Assia: Laurence, what a great session we’ve had here with lots of insights to unpack. How do you want to summarise the opportunities ahead in this space?

Laurence: I think it's exciting that everyone here is actually very interested in the channel, passionate about the opportunities ahead and excited to see where affiliate marketing can go. There were some pain points mentioned around data, proving incrementality of the channel and all those kinds of considerations. Where we play a role there is helping people address those challenges particularly around data, attribution and building the scalability piece. When you have the tech in place, you can really grow this affiliate space out to include all of those different types of partners, creators, content publishers, traditional affiliates, customers. That’s where all of a sudden, you have this engine of traffic coming your way.