Can't decide what to get someone for the Holidays? If so, you are not alone. Getting that perfect gift is not easy.
Earlier today, Amazon launched a new promotion that allows Amazon affiliates to receive referral fees of 6% on sales of Amazon.com gift certificates -- the first time such promotion was ever offered to Amazon.com Associates. In a well-timed move for the biggest shopping season of the year, Amazon now allows you to offer your visitors an escape from the dilemma of what to buy for their friends and family.
This is an experiment for Amazon. At this time this promotion is due to expire at the end of 2006 but I wouldn't be surprised if Amazon were to continue it permanently.
Gift certificates have quite a number of great characteristics for merchants such as Amazon:
1. Gift certificate purchases are not redeemed immediately. This translates into positive cash flow for the merchant. When a gift certificate is purchased and not redeemed for a period of two weeks (as an example), the merchant collects interest on the value of the gift certificate for the two week period.
2. Some gift certificates are never redeemed. Some people just misplace or simply forget about a gift certificate they have received. For a merchant with small margins, this is the best outcome: they make a 100% profit on an unredeemed gift certificate.
3. Even a redeemed gift certificate is frequently not redeemed for the exact value of the certificate. Most often, the recipient of the gift certificate will spend over the amount of the certificate in order to not leave any portion of it unspent. Any product purchased that is higher than the value of the certificate automatically carries a benefit to the merchant -- they only need to pay a referral fee on the value of the gift certificate sale, not on the value of the products purchased with the gift certificate.
The reason why Amazon is experimenting is given the significant benefit for Amazon, it is almost a no-brainer to see whether this promotion works. The risks that Amazon faces are on two fronts:
1. Because it is the first time a gift certificate sale carries a referral fee, Amazon does not have historical analytics on how well affiliates will be able to monetize their sites by promoting gift certificates. If gift certificates do not convert well, associates could quickly switch to a better-converting promotion from another merchant.
2. If a gift certificate is sold via an Amazon Associate and then used to purchase an Amazon product from a different (or even the same) Associate, Amazon will have to pay a referral fee twice, once on the sale of the GC, and again, on the sale of the product. Amazon hopes to learn whether this is a frequent occurrence and possibly change rules if this double-payment of fees becomes frequent.
The good news is that almost any site out there can promote an Amazon gift certificate. There is not limitation on the genre of the site, it's content or demographic of their visitors. Anyone can purchase a gift certificate redeemable at Amazon.com with its multi-million product catalog.
So, how do you promote an Amazon.com gift certificate?
First, you must register as an Amazon.com associate. Very simple to do, just follow this link to Amazon.com and fill out their registration form.
Second, visit the "Build Links" section of Associate Central (the Associates dashboard site that appears after you log in).
Third, click on "Banner Links" section. You will see a link to "Gift Certificates" promotional links where you can choose a number of different creatives:
There are quite a few other creatives; above is just to give you the flavor.
Let me know what you think of the Amazon.com gift certificate offer!
Gene Kavner, Former World-Wide Director, Amazon Associates Affiliate Program, 2005-2006.
Join Amazon Associates Today -- it's Easy and FREE!
Gene,
It's about time they started offering commissions on gift certificates. It's amazing how many etailers don't commission affiliates on gift cards and gift certificates. You would think this would be a no brainer for them.
Quite honestly, I think that many affiliates probably assume they are getting commissions on gift cards when often they are not.
I learned this after I created Buy-Gift-Cards.com
It's amazing though this year, both Linkshare and Performics have actually sent out lists of their merchants who do offer commissions on gift cards.
This is a great new trend!
Adam
http://www.buy-gift-cards.com
Posted by: Adam Viener | November 22, 2006 at 06:11 AM