Brands Leveraging Affiliate Channel to Move Retail Inventory

Brands no longer wait until Black Friday to release their best deals, now that the holiday season is upon us and retail shopping is in full. Even as inflation cuts into consumers’ budgets, they’re still planning to spend money this season. Deloitte predicts a 4-6 percent increase in retail sales for 2022 – and roughly 13 percent growth in e-commerce sales from 2021.

Yet because of global inflation, brands find that their inventory takes longer to move than before. Furniture, home goods, electronics and appliances, and apparel and accessories are all taking longer to sell, according to the U.S. Census Bureau. Consumers are well aware of the glut of inventory on the market and are actively scoping out deals as they shop for holiday gifts. In just the U.S., 51 percent of consumers plan to use coupon sites and browser extensions to help them find the best prices this season.

With consumers expecting discounts this season, here’s how brands can leverage affiliate partners to effectively move inventory and make sales.

Add Deal and Loyalty Partners to Affiliate Programs

Consumers love loyalty programs — 80 percent of consumers belong to at least one loyalty program. Meanwhile, 60 percent of those consumers will spend more with a brand after they sign up. 

This holiday season, consumers will gravitate toward loyalty programs to save money and earn rewards, as 84 percent are expected to shop with retailers who run them. Deal and loyalty partners can help attract these consumers to brands they may not have considered.

Attract Shoppers with the Right Coupons

The importance of coupons cannot be overstated. Over three quarters (76 percent) of U.S. consumers research deals before buying, and 32 percent use coupons. Consumers have seen the price of goods increasing, and with their budgets limited by inflation, they are looking for ways to save money. With an urgent promotion or offer, consumers are incentivized to purchase immediately instead of waiting for a sale or checking out competitors’ sites.

When it comes to the type of coupon, 35 percent of consumers prefer a “percentage off” discount, such as “15 percent off the entire purchase,” over free shipping, dollar amount discounts, and free gifts with purchase. Many consumers can be converted to customers with a small discount, even as low as 5 percent. Brands can use their affiliate partners to test different types of coupons, as well as the amount of the discount offered to shoppers.

Provide Deeper Discounts on Excess Inventory

Brands are struggling with unwanted inventory globally, and coupons can help unload some of that inventory and acquire new customers. Testing coupon codes on different products or categories is a way to move products and increase conversion rates. Offering that additional percent off for excess inventory can also lead to repeat business.

Show Appreciation to Customers

Consumers need help with rising costs – and in some cases, that means timing an offer to show appreciation. Over 70 percent of consumers say private label brands are a better value than national brands and are willing to buy private label products (also known as trading down) to save money. Now is a good time for brands to offer discounts to attract consumers and incentivize them to buy by matching the cost of the private label brands. 

Brands can position the offers as “10 percent off for the holidays!” and use messaging to make it clear that the offer is for a limited time. This encourages consumers to shop directly from the brand and shows that the brand cares about its customers enough to not only improve their shopping experience but also support their efforts to find the best deal.

Use a Mix of Partners

Deal, loyalty, and coupon partners can drive significant revenue for brands, but they’re not the only types of partners to consider. Brands are also seeing success with Buy Now, Pay Later (BNPL) partners and card-linked offer (CLO) affiliates. Integrating BNPL and CLO affiliates can help brands reach more consumers and offer options that will lead to conversions.

An important consideration for brands is how to measure the success of their affiliate programs when adding new types of partners. Defining KPIs will be critical, as will the ability to measure incrementality and partner performance. While this can be done in-house, working with an agency can ensure the right tools are used. 

The holiday season is an opportunity for brands to move excess inventory while attracting and retaining customers. Ultimately, the key is in the mix of affiliate partners being used and the types of incentives being offered.

Kelly Ground is director, strategy and insights, at Acceleration Partners.