In watching the life cycle of rewards programs, as I have on CompareRewards.com for 8 years this month, there’s something I’ve noticed that happens to every program when it’s on the downhill slide: it shuts down its affiliate program. Examples?
- Shut down its affiliate program in early 2008,
- made all earned points worthless in May 2008,
- completely disappeared in April 2009.
So when I found out that SunshineRewards sent out an email on Monday announcing the closure of their affiliate program through the ShareASale network, I was very concerned. In the email, SunshineRewards stated that the reason for the closure was that the traffic it generated was “not what we had hoped.”
This could actually mean one of a couple of things. ShareASale tacks on 20% to whatever a merchant (in this case, Sunshine) pays its affiliates (webmasters, mommy bloggers, whoever’s promoting SR through ShareASale’s links), with a minimum monthly charge of $25. So it could mean that SR wasn’t getting enough new leads to justify the $25 a month cost.
It could also mean that the new members coming into SunshineRewards were joining (thus the webmasters were being paid for referring them), but they weren’t sticking around to generate revenue for the site.
Neither situation seemed to be a good indicator for the company. If it’s the former, how bad off do you have to be to not be able to afford $25 a month? Or if it’s the latter, what is it that makes people check out Sunshine, then run away?
I voiced my concerns in an email to SunshineRewards’ founder and CEO Tricia Meyer, who was gracious enough to write back almost immediately explaining her reasons for the decision.
She said that the affiliate program’s closure had “absolutely nothing to do with finances” and was more related to a desire to have more control over where the site was advertised. She noted that the refer-a-friend program was still in place and generated more traffic, and more active members, than the affiliate program had. She also noted that the reward to members for referring a friend had not changed. (Although I have to point out that the refer-a-friend program only pays when a referral reaches a particular minimum activity level, versus the affiliate program that paid immediately after a new member joined.)
To those concerned about the timing of their affiliate program’s closure, in the traditionally-profitable fourth quarter, Ms. Meyer stated that the company was continuing to spend on advertising in ways that provided better results and more control, including targeted Google ads, Facebook contests and Fan Page ads, and other promotions including an Amazon gift card giveaway the site is offering this month for Halloween.
Will SunshineRewards buck the trend of rewards programs discontinuing their affiliate programs and then closing down or selling off within a year’s time? I certainly hope so! I’ve referred many people to SunshineRewards and will continue to do so (in fact, here’s my link if you want to try them out). But yes, the news of the affiliate program’s closure did make me nervous and I’d be doing my readers a disservice to fail to report about it.
I want to thank Tricia Meyer of SunshineRewards for taking the time to so graciously respond to my concerns…and I wish her, and SunshineRewards, the best. Please click “Continue Reading” to view the full text of Tricia’s email, reprinted with her permission.
In the interest of full disclosure, I am a shopping blogger for two of Sunshine’s competitors, Ebates and QuickRewards.net.
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Subject: RE: Closure of Affiliate Program at SAS
From: “Tricia Meyer”
Date: Wed, October 14, 2009 7:45 am
As a matter of fact, this had absolutely nothing to do with finances. We had been thinking about doing it for the last year because the affiliates that were signing up with us were pulling some pretty dirty tricks, in my
opinion. They were signing up with one URL and then running our links on other Get Paid Sites. Our affiliate links were showing up in a number of different places that we did not like (including pages with pictures of underage girls and foul language). I think you would agree that it would be pretty shocking to get a Google alert about your business and see it advertised next to something like that.
During that same time, we launched our Facebook Fan page and it has been a huge success. Because of that, we decided to channel our affiliate money instead into more Facebook Fan Page ads and money for contests on our Facebook Fan Page. It just makes sense to spend advertising money in a place that we have better results and can control more.
We continue to pay our members the same amount for referring their friends. Our studies have shown that members referred by other members tend to become the most active members. We generate 10 times the amount of traffic through our member referral links as we do through our affiliate program. The affiliate program just hasn’t been a priority for us and helping our members to refer other members has been. In the last week we launched a new application that allows members to post automatically on their Facebook page after they take a survey, shop through us, or cash out. That will be a huge part of our holiday strategy. In addition, we’ve started putting more money into targeted Google Ads for the fourth quarter.
Over the last year we have been focusing on transitioning from the spammy offers that most rewards programs make most of their money from to more shopping and legitimate surveys. As a result, our shopping profits have been up as much as 58% year over year in some months this year. For me, it’s about giving our members something that I can be proud of, and I am not proud of sending them offers that I know are just going to result in their inboxes being filled with spam. Thus, we’ve been making changes to our system and our company to be more in line with our personal beliefs. I hope that in the end it will mean that members are getting what they want and we can continue to be leaders in the affiliate industry.
An article should be coming out about us in Revenue Magazine next month and our plan for a big holiday promotion. We’re also running a Halloween promotion this month where we are giving out Amazon Gift Cards. The cash flow is not the issue itself but rather putting the money in places that it will yield the best results.
Hope that helps with your article.