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Key terminology to know before reading:

  1. Advertiser: The owner of the product/service that wants to move online
  2. Publisher: The online enabler who will help with the product’s online visibility

 

Before we dive in, it is important to clarify what affiliate means in simplified, everyday language. For those who are already aware, feel free to skip the first part and go straight to the second.

Affiliate refers to doing online marketing through representation. Whether it’s enlisting a salesman, supplier rep, brand ambassador, product reviewer or any individual who can help you advertise and sell, they all fall into the ‘affiliate’ criteria.

These agents earn commission through the product or service owner following a purchase made from their ad, which makes being an advertiser accessible for anyone with a social media account.

affiliate marketing
The benefits of being an Advertiser:

  1. Instant promotion of your product
  2. Maximising sales channels
  3. Easier cost control – only have to pay when your product sells through affiliate

The benefits of being a Publisher:

  1. Commission is set by the seller
  2. No requirement to store stock or product
  3. A chance to build income from what you may already be doing i.e. writing product reviews
  4. Steady source of income. If your website is without advertising banners, you are able to replace the ad space
  5. Potentially higher income than Google Adsense

The Affiliate system would not be possible without an Affiliate Provider, which provides the platform for Affiliate Marketing. The provider ensures that all operations are transparent by acting as the middleman by assigning a tracking code to see which publisher sold which product, and how much commission they are entitled to.

3 Affiliated Providers You Should Know in Thailand

Lazada Affiliate: As a household name in ecommerce, Lazada also has an Affiliate platform. This means that Lazada simultaneously is the Advertiser and the Affiliate Provider.

affiliate marketing

Website: http://www.lazada.co.th/lazada-affiliate-program/
Fanpage: https://www.facebook.com/LazadaAffiliateProgramThailand/

affiliate marketing

Key Feature: Lazada is the biggest online marketplace in Thailand, drawing in over 30,000,000 sessions per month. This provides brands with high visibility, and gives publishers a higher chance to earn commission through sales.

Interspace Thailand: The company began operating Access Trade in Japan in 1999. With over 6,000 clients and 340,000 websites, it was the largest affiliate in Japan. In 2012, the company expanded internationally to China and Indonesia and launched in Thailand the year after.

With over 300 employees at Interspace and the know how of the Affiliate market in Thailand, the company’s goal is to represent CPA (cost per action) Affiliate, and is poised to become the leading platform in the region.

affiliate marketing

Website: http://accesstrade.in.th/
Fanpage: https://www.facebook.com/accesstradeTH

affiliate-marketing

aCommerce Affiliate: The latest Affiliate Provider to join the party. Having launched in Q3 2016, aCommerce Affiliate is run by Southeast Asian ecommerce solutions provider aCommerce. The company provides end to end services from website design, online marketing, channel management, fulfillment and after sales service for brands that want to sell online. The decision to launch aCommerce Affiliate provides the company’s clients with more online channels to promote and sell their products.

affiliate

affiliate marketing

Key Feature: High quality Advertiser network and an experienced team with know-how in ecommerce.

Website: http://affiliate.acommerce.asia/
Fanpage: https://www.facebook.com/aCommerceAFFILIATE/

These are the top Affiliate Providers you should know about in Thailand. It’s important to remember that each provider has different features and hence, different benefits that may be tailored to suit some businesses but not others. Beyond the list above, there are also other effective affiliate programs that may be suitable to your website.

For example, Thailand based freelance portal Fastwork.co also has an affiliate program. Fastwork doesn’t offer commission on a purchase, as it is a services website, so advertisers would make money on finding jobs for freelancers.

affiliate-marketing

The website will pay advertisers 150 baht if they bring first time users, which will be transferred as website credits. The advertiser can then request to take out the credits as cash for use.

Hotel booking website Agoda also runs their own affiliate program through its affiliate partnership contract. As an advertiser, you can run any sort of website or blog, and post ads on Agoda properties. Obviously, the more visibility your website has the better, and an advertiser can earn a series of steady income if one visitor books a luxurious hotel or multiple days vacation from your website.

affiliate-marketing

Affiliate Marketing shares similarities to the ‘chicken and egg’ story, what came before? If there were a limited amount of Advertisers, Publishers wouldn’t know who to promote. On the flipside, if there were a limited amount of Publishers, Advertisers wouldn’t necessarily put emphasis on Affiliate, since there is no one to help with product promotion. Therefore, the process of Affiliate requires simultaneous growth from both platforms, or one would have to sacrifice in order for Affiliate Marketing to grow in Thailand.

Betagro marketing

The rise of technology and the internet isn’t just disrupting traditional retailers; it’s also enabling brands to reach their customers directly without the need of a ‘middleman’. Dollar Shave Club effectively sold to their loyal subscribers without ad agencies, traditional media or offline distributors like Walmart and Walgreens.

With the Death of The Advertising Industrial Complex looming upon us, traditional, mass advertising such as outdoor, print, TV and distribution through offline brick and mortar retail are rendered inefficient. Companies like Unilever have no choice but to acquire ‘the little guys’ like Dollar Shave Club to stay relevant.

It doesn’t end here. Fresh off their $1 billion acquisition of DSC, Unilever is already in talks to buy Jessica Alba’s Honest Co. for another $1 billion.

The Advantages of Moving Towards Direct-To-Consumer

In many of his speeches, Alibaba’s founder and chairman Jack Ma talks about how the world is moving from Information Technology (IT) to Data Technology (DT). In a DT world, businesses have direct relationships with consumers, enabling the former to collect data to build and market products and services personalized to the latter.

One classic example is Xiaomi, the Chinese electronics company and 4th largest smartphone maker, who sells attractively priced smartphones on its website to drive the direct relationship with its users. The company then uses the data to push peripheral products, plush toys, software, and online and mobile advertising.

Amazon is the other example, selling other people’s products at lower margins to get the volume it needs to monetize through marketplace fees and Prime subscriptions:

Amazon, meanwhile, is transitioning to a new model completely. The vast majority of Amazon’s products are increasingly sold with little to no margin at all: profitability comes from fees paid by third-party merchants and Prime subscriptions. It is a model that is completely dependent on scale, and the lower the margin and thus prices, the higher Amazon’s volume, which means ever more leverage from Amazon’s massive fixed costs in infrastructure and logistics.” – Ben Thompson, Stratechery

This transition from IT to DT is exactly what Unilever is trying to achieve through its acquisitions of Dollar Shave Club and Honest Co. Both firms enjoy better margins through online marketing and distribution. More importantly, they own the direct customer relationship, which they leverage into higher customer lifetime values through innovative models like subscription commerce.

Direct-to-Consumer Accelerated in China and Southeast Asia

China and Southeast Asia are growth markets unburdened by a legacy offline retail infrastructure meaning brands are jumping over the middleman at a much faster pace than in mature markets like the US, Europe or Japan.

Why did internet ecommerce grow so much faster in China than in the US? Because the infrastructure of commerce in China was bad. Unlike here, where you have all the (physical) shops: Walmart, K-Mart, everything, everywhere. But in China, we have nothing, nowhere. So ecommerce in the US is just a dessert; it’s complementary to the main business. But in China, it’s the main course.”Jack Ma, Founder and Chairman, Alibaba

An example of traditional, non-conventional brands going direct to consumer is Yurun Group, China’s second-largest meat supplier in China. Based in Nanjing, Jiangsu province, Yurun operates in two sectors, chilled and frozen meat, and processed meat products, which are marketed under the brand names of Yurun, Furun, Wangrun, and Popular Meat Packing.

Yurun operates an official Tmall flagship store through which the company sells its various brands and products and also distributes digital vouchers.

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Betagro marketing

Capturing the Direct-to-Consumer Opportunity Through Digital Transformation

Fashion, electronics, and consumer packaged goods (CPG) aren’t the only categories that are increasingly being sold online. Let’s take a look at Betagro, a 50-year old Thai food manufacturing conglomerate, and identify the opportunities available for the company to go direct-to-consumer and transform itself to capitalize on today’s digitally-savvy consumer.

Who is Betagro?

Betagro Group was founded in 1967 by Dr. Chaivat Taepaisitphongse, the company’s current chairman. Headquartered in Bangkok, Betagro engages in animal feed production, livestock, animal health products, and food product businesses. The company is known for its brands like S-Pure eggs, Better Food, and Dog’n Joy pet food.

Betagro Value Chain & Gap Analysis

Below is a simplified overview of Betagro’s value chain. We specifically looked at Marketing and Sales & Distribution, two areas that are typically impacted by internet, ecommerce and technology.

Betagro mainly sells through retail partners like Tops, Tesco Lotus, Big C, and Family Mart and its own distribution channels, namely Betagro Shops, with a footprint of over 100 in Thailand. Unlike its main competitor Charoen Pokphand Foods PCL, who has access to massive distribution through its 8,000+ 7-Eleven branches in Thailand – Betagro still has to rely on partners.

From a marketing perspective, like many other traditional business in Thailand, Betagro still uses offline channels such as event marketing through roadshows, mall booths, etc. and sampling in supermarkets. Its online efforts are limited to its corporate website Betagro.com, which is lackluster, and content marketing on its “Betagro Society” YouTube and Facebook pages.

Betagro marketingMaximizing Marketing Opportunities

To maximize the company’s online efforts, there exists many opportunities across the user journey for specifically Content Marketing and Influencer and Affiliate Marketing that we highlight here. 

betagro marketing

Content Marketing: Videos

Given the very nature of its business, content marketing is a great way to educate, activate and engage customers for Betagro. Similar to how Dollar Shave Club leveraged its now cult-like “Our Blades Are F**king Great” viral video to spur its initial hyper growth, Betagro can create cooking videos and online recipes to engage their audience and build brand identity.

Betagro’s official music video on YouTube garnered over 5 million views in less than one year’s time. Although impressive, it pales in comparison to short-form cooking videos on Facebook like those by Tasty, some racking up over 30 million views in less than 12 hours.

Betagro marketing

Betagro marketing

Facebook’s powerful short-form, auto-play videos are now being applied by food business in Thailand such as Unilever’s Best Foods.

Content Marketing: Recipes

Best Food’s US website is another great example of using online recipes for SEO and engagement. While Betagro’s website mainly covers corporate information, Unilever’s BestFoods.com offers many recipes that allow the brand to display their products in attractive high-res imagery – selling without direct selling.

Betagro marketing

Having recipes online not only helps with engagement but also with SEO, resulting in an increase in organic traffic from Google. A quick look at Similar Web data for BestFoods.com shows top keywords are all recipe-related ones.

Betagro marketing

Influencer & Affiliate Marketing

Facebook paid advertising is one way to distribute content for Betagro. Another – and sometimes more efficient way – is to leverage influencers or “Key Opinion Leaders” (KOLs). In Thailand, due to a “no-tail” environment, a lot of these KOLs are on Facebook instead of having their own blogs or websites. Below is a list of popular cooking and food related KOLs.

Betagro marketing

Betagro could partner with these KOLs to educate and increase brand awareness through text and video content directed at an audience with interest in their products. In the Mai Yom Auon example above, the page owner cooks using a pan provided by the advertiser Korea King.

Another way to leverage these KOLs is by adding them to an affiliate program where the aim is to drive traffic to a future Betagro ecommerce website – either in the form of a brand.com or shop-in-shop on a marketplace.

Betagro marketing

Betagro marketing

Betagro marketing

Influencers can post a ‘shop’ on their official Facebook page to showcase the brand’s products to their fans.

 

Monetization: Ecommerce

The amount of distributors for Betagro products are limited leaving the company to the mercy of its retail partners such as Tesco Lotus and Family Mart. But by offering its products online, Betagro is able to increase its leverage vis-à-vis these partners as well as collect data from the end consumer.

Similar brands have already started doing so such as Yurun Group in China on Tmall and Globo Foods in Thailand on Lazada.

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Monetization: Online-to-Offline

Betagro can also leverage digital channels to drive offline sales. For example, Honestbee and HappyFresh are food delivery apps that are being used by major food retail distributors across Southeast Asia.

By partnering with these companies, Betagro can help drive foot traffic to offline Betagro Shops as well as promote and advertise Betagro brands and products.

betagro-happyfresh

By implementing the marketing strategies mentioned above, Betagro will be able to expand their audience, increase sales and jump ahead of competitors. The best part?  without largely denting their budget.

Written by Sheji Ho, aCommerce Group CMO

Betagro Case Study: Direct-to-Consumer Opportunity Through Digital Transformation Full Download