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Digital Marketing

An Insider Look at the Gift Guide Game

November 13, 2020
Mae Rice

Where do gift guides come from? We asked an affiliate marketer how brands negotiate placements — and if it’s too late to launch a 2020 gift guide strategy.

Table of Contents

It’s not yet Black Friday, but it’s definitely gift guide season — and it has been for weeks. On October 26, The Strategist ran “55 Christmas Gifts for Any Type of Mom.” That same day, Apartment Therapy published a holiday gift guide titled “Don’t Panic: These 26 Last-Minute Gifts Are Even Better Than If You Planned Them Months Ago.” 

That’s right. They published a guide to last-minute holiday gifts five days before Halloween.

It sounds strange, but both outlets were arguably running late. This year, “we saw the holidays starting much earlier with the launch of Prime Day” on October 13, Tye DeGrange, CEO of growth agency Round Barn Labs, told MarketerHire. 

DeGrange would know. He’s spent 15 years in the affiliate marketing space, and the holiday season is when the “lion’s share” of affiliate business takes place, he said. 

Gift guides play a key role in that. They’re an affiliate marketer’s dream; most, if not all, are a smorgasbord of affiliate links. 

The Strategist calls this out in an italicized note on the bottom of each of its posts. “If you buy something through our links, New York may earn an affiliate commission.”

*** 

What Is Affiliate Marketing?

It’s an umbrella term for a wide variety of cross-promotional deals; think of it as a way of making sales commissions available to non-traditional salespeople: shopping magazines, influencers, and even coupon purveyors like RetailMeNot and, more recently, Honey

***

Does that mean gift guides are pure pay-to-play marketing opportunities? No. Especially in “blue chip” outlets owned by The New York Times (The Wirecutter) or New York Magazine (The Strategist), DeGrange noted, an editorial team has to independently test and love your product before it can land in a gift guide.

But let’s say something widely available, like Hunter rain boots, gets selected for a gift guide. The editors could link out to a variety of product pages, from Amazon, Nordstrom, Zappos and more. 

How do they choose? Often, they pick the retailer who’s struck an affiliate deal with them, and link out with a customized URL, so they can track (and earn commission on) the sales their specific website drives.

Gift guides run year-round, but these linking decisions are highest stakes around the holiday season, when retail surges — and that’s especially true this year. Due to the coronavirus pandemic, online holiday spending could surge 33% year-over-year, CNBC forecasts

Gift guide links could be the new glitzy display windows. 

Like display windows, though, landing a link in a gift guide requires forethought. Companies that take gift guide placement seriously often start negotiating affiliate deals with publishers in August and September, DeGrange said. 

Some affiliates actually freeze business at the end of Q3; they’ve locked in their Q4 roadmap in advance. It’s such a lucrative time of year, they don’t want to take chances. 

So does that mean it’s too late to snag a gift guide placement for the season? Kind of. It’s “a Hail Mary” to attempt it now, DeGrange said.

But it’s not impossible.

Inside a Slow-Burn, Semi-Automated Process

Compared to self-serve advertising platforms, like Facebook Ads, affiliate deals are still relatively analog and slow to cohere. 

That’s not to say there’s no technical infrastructure. Shopify actually has a BuzzFeed integration, which makes it easier for Shopify sellers to snag affiliate opportunities on the site — and at Round Barn Labs, DeGrange and his team uses a variety of third-party software platforms, including Tune, CJ Affiliate, Impact and Rakuten.

These platforms help users manage vast ecosystems of existing partnerships. The software automatically tracks the sales each affiliate refers to each client; it also automates commission payments, and allows users to rank their partners from highest-value to lowest. 

But for clients seeking new affiliates, posting an offer to one of these platforms isn’t enough. Landing an affiliate deal isn’t like calling an Uber; it requires active effort and relationship-building.

“You need someone evangelizing [for] the program,” DeGrange said. 

This is his, and Round Barn Labs’ specialty. The team has a deep Rolodex, and a track record of success with many affiliates – but striking a deal is still a multi-stage process. It requires:

  • A conversation about holistic fit
  • Sending tester product
  • Hammering out pricing
  • Other negotiations

A conversation about holistic fit.

When DeGrange pitches clients to prospective affiliates, the conversation is almost “a mini marketing analysis,” he said, or a warp-speed positioning workshop. 

Each party brings different expertise to the table — for DeGrange, it’s a deep knowledge of his advertiser client; for the affiliate representative, it’s deep knowledge of their content, their audience and their use cases. 

Together, they sort out if the client’s product will resonate with the affiliate’s audience. Ultimately, neither party wants to force a meh affiliate deal — the client would lose money, and the publisher would lose credibility with its readers. 

“If it's not a fit, that's fine,” DeGrange said. He thinks of these conversations as ongoing feedback loops, not one-off pitches. 

Sending tester product.

Companies send free product to prospective affiliates, so the editorial team can test-drive it. (Reputable outlets try products before they recommend them.)

In the affiliate industry, this is called “product for placement.”

Magazines are constantly inundated with unsolicited free stuff, though, from companies hoping for earned coverage. A lot of it gets ignored. (There are only so many hours in a day for tasting disruptive granola bars.) 

Prospective clients are prospective profit centers, though, so editors at affiliate publications tend to make time to try their products. 

Hammering out pricing.

Typically, final pricing involves two components:

  • A flat fee for placement — This starts at around $5,000 per post for smaller outlets, and can go up to $50,000 a month for longer-term partnerships with bigger outlets, DeGrange estimated.
  • The free product — This is negotiable and depends on the product, partnership, and placement
  • A sales commission — Typically, this is a percentage of whatever sales revenue an affiliate drives to a retailer. 

Pricing varies, though, DeGrange said. Affiliates are always trying to balance making money with serving their readers. 

“Sometimes, they will be more willing to bend [on price] if there's really excitement around a product or an editorial content relevancy,” he said. 

Other negotiations.

Before a deal gets finalized, the client and affiliate usually also agree on a rough publication date and editorial expectations. (Clients may want certain features or language for their coverage; affiliate publications may want total editorial independence.) 

With a multi-phase negotiation like this, it pays to start the conversation early. Except when it doesn’t.

Foresight Isn’t 20/20 in 2020

Planning ahead only works when you can forecast the future with some accuracy. This spring, as the coronavirus pandemic and lockdown measures swept through the U.S., nothing went as forecasted.

For Amazon, the pandemic was a financial boon and a logistical nightmare. Since mid-March, the company’s stock price has nearly doubled. In the early days of the pandemic, though, demand for delivery skyrocketed and Amazon — the same retailer that mainstreamed two-day delivery! — experienced slowdowns and shortages.

Organic demand was so disruptively high that at the end of March, Amazon paused its affiliate marketing partnerships with the shopping verticals at BuzzFeed, Vox and The New York Times,  The Information reported

(In April, the retailer slashed commissions for the rest of its affiliates, too, CNBC reported. In some product categories, like furniture and grocery, commissions fell by more than 50%.)

This had a serious impact. The Strategist runs such Amazon-heavy gift guides that some shoppers have taken to Twitter to complain; The Wirecutter has a deep partnership with Amazon, too, so much so that DeGrange said he has spotted Wirecutter content republished on Amazon’s own website. 

Of course, Amazon wasn’t the only company to change up its marketing plans this spring. Spending on all kinds of digital marketing channel cratered in the early days of the pandemic; the travel and live entertainment industries went on near-total hiatus, and other industries tightened their purses, too, uncertain what strategy made sense in a pandemic.

But it’s less disruptive to pause a self-serve display ad campaign, Degrange said, than it is to pause affiliate partnerships with media outlets. Affiliate partnerships take time to negotiate, when a partner pulls out suddenly, it’s hard to slot in a last-minute replacement.

“Advertisers can kind of pull the rug out from under their affiliates,” DeGrange said. 

He recommends that his clients give affiliates plenty of lead time when they need to change their plans. Sudden shifts like Amazon’s erode the trust that’s key to long-term partnerships. 

But sudden shifts also leave a window of opportunity for spontaneous affiliate deals.

That window will likely not be as big this holiday season as it was in the spring of this year. Early coronavirus vaccine trials have yielded positive results, and the stock market is booming in response. Though unemployment remains high, and toilet paper on Amazon still occasionally costs $72, a kind of stability has returned.

Keyword: kind of.

Your Next Move

If you still want 2020 gift guide placement, listen up: You’re running very late, and you should plan further ahead next year. But also, shoot your shot.

As this spring demonstrated, an unexpected dip or spike in demand can derail the best-laid affiliate marketing plans, and this has been an unpredictable year. Online retailers could be overwhelmed this holiday season — or so underwhelmed that they can’t afford their August marketing plans.

“If somebody has to bail out last minute, you could get lucky,” DeGrange said. “It's happened before.”
Mae Rice
about the author

Mae Rice is senior editor at Marketerhire. A long-time content marketer, she enjoys interviewing marketing experts and learning about the weird and wonderful feedback loops that connect marketing and culture. She also loves any ad that makes her say "Huh?!" — especially Tim and Eric's ad for Totino's pizza rolls, which she watches way more often than you would think.

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