Why decrease the cookie period?

Feb 9, 2009 -

Over the past few weeks, a number of merchants have decreased the length of an affiliate cookie, communicated by way of, whats becoming, a generic email;

Dear Affiliate,

MerchantA have recently been running analysis into the cookie length of the programmes. These investigations have shown that the majority of transactions occur within 30 days of the original click time.

As a result of this, MerchantA have decided to reduce their current cookie period of 90 days down to 30 days.

As the highest percentage of sales occurs within this period anyway, we believe this will not impact affiliates to a great extent.

I’ve often wondered why Merchants do this? A long cookie length doesn’t attract any additional cost to the merchant so why go down this route? If the majority of sales are made, as their research suggests, within 30 days then MerchantA doesn’t stand to pay out too much commission for those made on day 31 and after. So why not just leave it as it is?

Is it purely greed, in that MerchantA doesn’t want to pay affiliates for sales after 30 days or is there another reason/beneift that I’m missing? Although a merchants research signifies that changes will not “impact affiliates to a great extent” – it still has the potential of impact.

Maybe I’m missing something?

http://www.mabailey.co.uk Matt Bailey

No idea, it seems a very starnge thing to do. If, as they claim, it has very little impact then why change it? If they are deduplicating correctly across all channels then it is not possible that there is another referrer in that time, therefore there is a strong argument to say that the affiliate is responsible for driving that sale.
http://www.upthejunction.com John Cronin

Isn’t it a way of the merchant improving their margins by saving on some commission payments?

I presume they state that most sales occur within a short time period in an attempt to keep us poor affiliates happy.
http://www.affiliatewindow.com Kevin Edwards

James, without addressing the rights or wrongs of what the merchant has done, it seems they have brought their cookie length in line with what would appear to be a standard cookie length on the Affiliate Future platform – 30 days.
http://www.webaffiliate.co.uk Chris Frost

I agree with all comments, and I don’t wish to single out one particular merchant, or one particular network as it’s common across the board.

However, if they make hardly any sales after the 30 cookie, then what is the harm in leaving it as 90 days?

By the way…
Incase you’re wondering who Kevin was replying to, James isn’t an imaginary friend ;) He asked me to remove his comment as it read incorrectly, so hopefully will see new comment from him to clarify.
http://i-level.com Fionah

One possible reason is that the cookie window needs to correspond with other advertising channels. Affiliate marketing rarely stands alone but is part of an overall advertising mix. The allocation of a marketing budget is based on results, therefore like for like reporting is needed in order to make that decision.

Not saying that’s the reason for this particular merchant, just one possible reason of course.
Darren

I also wondered about this after receiving the latest bunch of emails.

If there is little impact in terms of lost commission to the afiliate then why reduce the cookie period.

If anything the statement contradicts itself somewhat.
http://john@prezziesplus.co.uk john ayres

I din’t know about other retailers but our stats show 95.18% same day sales and 0.79% over 30days.
This seems to suggest the length of cookie is completely irrelavant either way, since 30 days covers over 99% I wouldn’t lose any sleep over it, 30 days just seems a reasonable period to allow.
http://www.webaffiliate.co.uk Chris Frost

Hi John, as you say thats your stats, mine and others may not show that, so although you may not lose sleep over it, others may. I personally have the odd sale from a cookie delivered over 30 days, and its a nice surprise.

However I am after a better understanding of why merchants do this, rather than individual experiences. I agree 30 days is reasonable, but as darren points out, if there is little impact to affiliates, then why reduce it? Thats the question I’m trying to get answered.
http://www.prezziesplus.co.uk John Ayres

Chris, the only real reason is to save money although this is more a problem for merchants that have perpetual voucher codes giving say £5 off £20, obviously a sale at or near the base £20 would constitute a loss to the merchant. With a 30 day cookie they at least have the possibility of the customer coming back for a full price or commissionless sale and so make up some of the loss on the first sale.
A lot of customers visit and buy once or twice a year only depending on the seasonality of products and the only way for affiliates to benefit from repeat orders would be to have a 365 day cookie, no merchant would want such a long commitment to commission. If they had voucher code directories as affiliates, they could be in a situation of paying commission perpetualy, certainly not a formula for staying in business.
There has to be a balance between rewarding the affiliate and making a profit, now that we have a private program we will be experimenting with various combinations of cookie and commission, based on feedback from affiliates (and reading blogs like this).
http://www.webaffiliate.co.uk Chris Frost

John

Agree it is purely to save money, and its nice to see you, as a merchant, come out and state this for exactly what it is, unlike others… RESPEC!!!

However, BuyAGift and Prezzybox don’t stand by your “no merchant would want such a long commitment to commission”. Infact Prezzybox, via the POR network, give you lifetime commission of that customer if I’m not mistake. I accept that these are an exception to the norm, but it does happen and it is possible as a business model.
http://www.moreniche.com/blog Craig Parker

I can see both sides of it, the email and reason they sent were definitely unreasonable and to be fair the point you made stands, if its such a marginal number why cut it off?

From a merchants point of view I can see why they would want to make a 30 day limit, I do (if I step out of the bias) think 30 days is reasonable but still it’s shifting goalposts and not on at all.
Silv

I have to agree with Fiona – it is more than likely they are trying to align their cookie windows across all their channels – ie. display as well.

If all other channels are tracked on a 30day window but an affiliate conversion is happening after 30 days – I guess it doesnt give you a fair and true understanding of the user online journey (god I hate that phrase!)

That, or they are just a bunch of c***s…
http://specialskitraining.info/blog Derek

I’ve read all the comments, and most seem to be from the affiliate or merchant point of view.
Suppose a customer buys something from MerchantA. The transaction goes well and 35 daus later they decide to buy something from the same company.
Are they more likely to remember the website they clicked through to get to the merchant or the name of the merchant themselves printed on the receipts etc from the last time they used them? I reckon the latter.
By the customer direct clicking on the MerchantA’s website, the affiliate is out of the loop all together with an improved profit margin for the merchant. Perhaps that’s why one major merchant has cut their cookie period to 24 hours!