Archive for November 2007

Are you more loyal to Eco-friendly companies?

I recently read an interesting article about the correlation between consumer loyalty and eco-friendly brands. I think we all can agree that the ‘Green Movement’ is gaining popularity and changing the way we view consumer goods and Corporate America. While I personally believe in supporting the environment, I haven’t yet changed my consumption behavior to reflect my environmental beliefs. recycle The article states that consumer advocacy and environmental groups are targeting even the most reputable brands with green boycotts if they don’t follow eco-friendly practices. Some of these business minds feel a company that isn’t managed with eco-sustainability in mind may not be inherently sustainable over the long-term. I don?

Shopping Bag Gets Press

I was searching on google for any type of news on rewards programs and came across a great article on EcommWire.com. It talks about Shopping Bag, which is a new software application by iBakeSale.com that gives members the ability to collect their cash-back rewards by going directly to any participating merchant’s website. Here’s headline quote from the article… Shopping Shopping Bag makes shopping rewards appealing to larger audience – Frees users from affinity sites Getting rewards for online shopping is no longer limited to affinity websites because of www.getShoppingBag.com. Shopping Bag users can now search freely, shop and still collect cash rewards. You can check out the rest of the article here. If you are interested in earning rewards in the easiest possible way when you shop online, then this is the way.

The Economics of Co-Branded Credit Cards

Somebody recently asked me why an organization would opt for its own credit card. There are a few rewards programs out there that have done deals with large banks for their own co-branded cards. Many of you are familiar with co-branded cards in the form of a Visa or MasterCard for a favorite sports team, charity, alumni association, or large consumer rewards programs like Upromise and SchoolPop. The economics are pretty simple. An issuing bank (e.g. Bank of America, Citibank, Chase etc.) make money on a credit card usually around 2-3% of each purchase by a consumer. With a co-branded card deal, the bank usually shares part of the discount rate (usually around 1%) with the consumer organization. The banks also normally provide some money up-front for purposes of promoting the card to the organization’s membership. With these economics, that’s why many of you will see a 1% reward on your Upromise or SchoolPop credit card on every purchase you make. This is in fact the revenue shared back with the organization by the issuing bank. With charities and alumni associations, the 1% usually accrues to the organization, whereas with other types of cards, the rewards on the card can be in the form of points and redeemed for merchandise etc. Hopefully that helps shed some light on the dynamics of the co-branded card market.

Affiliate Marketing is Booming

In a recent report by E-Consultancy, affiliate marketing techniques have witnessed dramatic growth recently, with 78% of brands surveyed reporting that they will increase their investment in affiliate marketing over the next 2 years. This is incredible, even for an industry that has been growing dramatically since it’s inception over 10 years ago. The CEO of E-Consultancy references the decline of broadcast advertising as a boon for affiliate marketing and other performance-based marketing channels. Nearly one-quarter of those that are spending more reported having doubled their spending on the channel in the past two years. Two-thirds of respondents said that the number of sales generated by affiliate marketing has increased over the past two years, and 40% said they have more people employed to manage affiliate marketing than they did two years ago. Half of those expect this number to continue to grow over the next two years. Interestingly, the merchants surveyed site the main barrier to adoption as a lack of internal resources to manage their affiliate marketing initiatives. More likely, however, is that many advertisers are still learning how to maximize the effectiveness of the affiliate marketing channel. Part of this is a changing perception of affiliate marketing, which was once viewed as a sketchy marketing discipline to promote vitamins and other questionable products. Based on the study, over 1/3 of all respondents think affiliate marketing is becoming more mainstream and accepted as a legitimate marketing channel. Still, over 50% of respondents think that there is some way to go before affiliate marketing becomes completely mainstream. Nevertheless, the study shows that this marketing channel is gaining legitimacy and popularity among marketers who are serious about measuring ROI.