Building profitable relationships

IT Week: As UK managing director of digital marketing specialist TradeDoubler, can you tell me about the origins of the company?

Andreas Bernström: We started in 1999 in Sweden as an affiliate marketing provider and then developed into a performance-based marketing company. The idea of affiliate marketing was hatched by Amazon, which allowed third-party sites to direct traffic to its site, and when a purchase was made, it would give that third party a percentage. We have firms like Apple, Dell and eBay as customers. We take their services and promote them on our web sites. We currently have 180,000 publishers hosting these ads. We track the transactions carefully so both sides can see what happens and then we pay out to the publishers.

So what is the value-add that you bring to the model?

We work on the design and placing of the adverts and advise the publishers on what they should charge for carrying the ads. This involves a lot of face-to-face meetings about creative issues and brand image.

Do IT departments have a part to play in affiliate marketing?

We always have to get buy-in from the client’s IT team. For us to track links from publishers and affiliates, we need to put a pixel on the site that allows us to collect and store all relevant transaction information such as customer name, product name, order number, reference and price. It’s not a hugely complicated installation, but it needs IT buy-in.

Has the sector changed since 1999?

We’re dealing with a higher calibre of publisher now, and because this model is generating upwards of 25 percent of online sales, it’s a very important part [of the marketing business]. This means we do business with managing directors and CEOs rather than just online marketing managers. We’ve also developed our technology, introducing a tool called td Talk that allows us to track customer calls. This is particularly useful for sophisticated or big sale items where customers often want to speak to a sales adviser.

What are your views on click fraud?

There has been a lot of press coverage about it, but it’s different to what we do. We pay on a sales basis rather than a click basis, and it’s almost impossible to generate a fake sale. If a newcomer comes along and generates an unusually high level of sales then we do our research before we pay out to that publisher.