The latest edition of the benchmarks report has even more insights than the past. This edition debuts coverage for eight new categories, including Accessories, Business, Department Stores & Malls, Health & Beauty and more. These network insights help advertisers recognize where they’re outperforming others and where they need to dedicate more energy, so it’s a must-read for all of our data-centric, data-loving clients (and we know there are a lot of you). Want more info: http://blog.cj.com/09102013/live-cj-network-benchmarks-report

1. The COMMISSION JUNCTION
NETWORK BENCHMARKS
Advertiser Program Performance Insights
January – June 2013
Released:
September 2013

2. Advertiser Program Performance Insights, Jan – June 2013
INTRODUCTION
CJ advertisers are
seeking benchmarks
for their own affiliate
growth as well as
insights into what is
occurring in the
network, overall.
Even in the face of overall slow economic growth, US advertisers are reporting growth
in their online sales, with some advertisers averaging 28% sales growth in 2012 1.
Consumers continue to choose online shopping for its value, convenience and
selection. The CJ Network, with its comprehensive reach into many aspects of the
consumer shopping experience, also saw its sales grow and more online ad dollars
allocated to it. Consequently, CJ advertisers are seeking benchmarks for their own
affiliate growth as well as insights into what is occurring in the network, overall.
This third installment of the Commission Junction Network Benchmarks report
presents the key performance metrics that advertisers use to measure the success and
efficiency of their affiliate programs. In order to provide greater insights, this edition
debuts detailed metrics for the following categories: Accessories, Automotive,
Business, Department Stores & Malls, Health & Beauty, Gifts & Flowers and
Sports & Fitness.
The Commission Junction Network Benchmarks report is compiled from CJ
Network sales activity for January - June 2013 and compared to the same time period
in 2012. The performance trends are presented by advertiser industry. This analysis
focused exclusively on the sales for CJ advertisers operating in the US and Canada.
1
Shop.org “The State of Online Retailing, 2013: Key Metrics and Initiatives”, Jan. 2013
2

3. Advertiser Program Performance Insights, Jan – June 2013
METHODOLOGY
To create the Commission Junction Network Benchmarks report we focused on major categories for the CJ Network,
closely aligning them to other 3rd party categorizations. This may result in some categories being named differently than in the
CJ Account Manager and/or being grouped together with other categories. This edition of the report looked at all advertisers
for the First Quarter and Second Quarter of 2013, calculated their individual program metrics and then averaged those
metrics to achieve a category average for the first six months of the year.
Network Benchmarks Category
CJ Parent Category
Accessories
Accessories
Automotive
Automotive
Business
Business
Careers
Online Services
Clothing
Clothing/Apparel
Computers & Electronics
Computers & Electronics
Department Stores & Malls
Department Stores/Malls
Financial Services
Gifts & Flowers
Health & Beauty
Home & Garden
Media & Entertainment
Financial Services
Insurance
Gifts & Flowers
Beauty
Health & Wellness
Home & Garden
Art/Photo/Music
Books/Media
Entertainment
Recreation & Leisure
Sports & Fitness
Sports & Fitness
Travel
Travel
3

4. Advertiser Program Performance Insights, Jan – June 2013
METRICS
Clicks: The consumer traffic that is sent to an advertiser’s website by their publishers.
Conversion Rate (CR): The ratio of clicks to an advertiser’s site from consumers
who complete a desired action, such as making a purchase or completing a lead.
Average Order Value (AOV): The average dollar amount spent per customer
order.
Cost Per Action (CPA): The total cost an advertiser pays to affiliate publishers for
each action.
Earnings Per Click (EPC): is a relative rating that illustrates an advertiser’s ability
to convert clicks into commissions (this ratio is multiplied by 100 for aesthetic
reasons).
Return on Ad Spend (ROAS): is a measure of how much gross revenue an
advertiser earns for every $1.00 spent on acquiring the sale.
4

5. Advertiser Program Performance Insights, Jan – June 2013
EXECUTIVE SUMMARY
Consumers have
signaled a willingness
to spend more per
shopping trip and the
first half of the year
presents the best time
for affiliate managers
to launch program
growth strategies.
The affiliate channel mirrors the overall trends of ecommerce and is a good reflection
of consumer interests and buying behavior. Seen in this light, the CJ Network
Benchmarks report covering the first half of 2013 reveals some interesting data points
related to consumer activity and the degree of success affiliate marketers are having
with meeting consumers’ needs.
Order sizes are growing, again. For two consecutive years, consumers have
signaled a willingness to spend more per shopping trip when shopping advertisers’
sites. Overall, the network’s advertisers saw their AOV grow by 4% year over year and
some categories realized even greater gains, most notably Automotive (11%),
Computer & Electronics (8%) and Accessories (6%). Consumer purchasing power
improved in the first half of the year, rising by 3.2%, and consumers funneled those
gains into durable goods.2 If this trend holds, the first half of the year presents the best
time for affiliate managers to launch program growth strategies, striking while
consumers are willing to spend more freely than during the high-volume holiday
shopping season when discounting (and deal hunting) is at its peak. Additionally,
throughout the year advertisers and publishers should consider how they can
merchandise goods and offers in ways that introduce shoppers to higher value items
when considering a purchase. Offering coupons has been shown to deliver incremental
growth in AOV—75% of shoppers report that finding a coupon for their purchase
influenced them to “buy even more because it was such a great deal.” 3
Canada growth outpacing US. Canadian retailers in the affiliate channel are
realizing gains on their investment that exceed the growth of US programs. Canadian
retailers in the highly competitive Department Stores & Malls category, for example,
increased clicks an average 52% (versus the 33% average growth of their US-focused
competitors) and also grew their AOV by 5% (US competitors declined). In a “build it
and they will come” approach, Canadian retailers created Canada-specific affiliate
programs, creating the momentum for publishers to also cultivate consumers North of
the border. The affiliate channel in the past year has seen a number of publishers
venture into the Canadian market, simultaneously tapping into and generating interest
in online shopping. Canadians have been online for years (47% of the country’s internet
users have been online for 10 or more years)4 and 63% of internet users shop online.5
But they have had limited online buying options, frequently shopping US-retailers who
ship to Canada, and would likely prefer more home grown options. The combined
effect of broader publisher reach in Canada and an active shopper base point to this:
advertisers should view the affiliate channel as a low-cost and low-risk way to build
their brands in Canada and increase their exposure to Canadian shoppers.
2
3
US Department of Commerce, Aug. 2013
CJ Insights, Coupon User Survey, Sept. 2013
4
5
Statistics Canada, Oct. 2011
eMarketer, July 2012
5

6. Advertiser Program Performance Insights, Jan – June 2013
ACCESSORIES
“Millennial” shoppers, those that fall into a
group aged 18 – 34, are leading buyers of
shoes and jewelry online—when surveyed,
81% report making a recent shoe and or
jewelry purchase online. 6 This group is also
inclined to shop with coupons (23% of
Millennials identify as “extreme couponers”). 7
In light of this and the fact 43% of shoe
shoppers consult 2- 4 sites before converting,8
it is significant that the network’s shoe and
jewelry retailers achieved gains in conversion
(8%), average order size (6%) and ROAS (8%).
The growth in costs (10%) appears tied to the
overall growth in the average order size and
was balanced by the increase in ROAS.
Growth
Clicks
8%
CR
8%
AOV
6%
CPA
10%
EPC
4%
ROAS
8%
AUTOMOTIVE
The average age of US cars and trucks is
now 11.4 years, a new record (a decade
ago the average age was 9.7 years) 9 and
when consumers choose to drive their
existing vehicles longer, auto parts
stores reap the benefits. Automotive
retailers registered growth in most
categories, achieving the highest retailer
growth in conversion (15%), EPC (16%)
and average order size (11%). The
decline in clicks was sizeable for some
automotive advertisers in this category
and the metric should be monitored by
advertisers to gauge competitive
weakness or strength.
6
7
Compete “Summer 2012 Online Shopper Intelligence Survey,” Aug. 2012
DDB Worldwide, “DDB Life Style Study, Jan. 2013
Growth
Clicks
CR
11%
CPA
14%
EPC
16%
ROAS
9
15%
AOV
8
-4%
4%
Compete/Google Footwear Study, Q4 2010
Polk Automotive Forecast, Aug. 2013
6

7. Advertiser Program Performance Insights, Jan – June 2013
BUSINESS
Advertisers in the Business category
(encompassing our Business, Careers and
Online Services advertisers) on average saw
declines in clicks (-12%) and conversion
(-5%), likely due to the increased
competition for these products/services
from new entrants in the field and (specific
to office supplies) the migration of sales to
discount stores and warehouse clubs.
Online sales of office supplies is forecasted
to grow 13% in 2014 and reach $8BB,10 but
the real opportunity may lie with converting
more B2B buyers, because advertisers in
the network with services tailored to
businesses fared better in the first half of
2013.
Growth
Clicks
-12%
CR
-5%
AOV
1%
CPA
5%
EPC
-2%
ROAS
7%
COMPUTERS & ELECTRONICS
After a sluggish 2011 in which US online
sales of computer and electronics only
grew by 11%, sales perked up in 2012,
growing 17% YoY. 11 An ongoing rebound
for the sector was reflected in the
network, where Computer & Electronics
category realized an increase in average
order value (5%) and EPC (2%). These
were offset, though, by an increase in
costs per action (4%) and a decrease in
return on ad spend (-3%). Assuming the
US online sales growth continues this year,
the chance at hand is to identify ways to
grow conversion rate, possibly by
adopting new tools or promotion
methods emerging in the CJ Network.
10
11
Barclays Capital, “Internet & Media 101”, Nov. 2011
eMarketer ecommerce sales forecast, Sept. 2013
Growth
Clicks
10%
CR
-7%
AOV
5%
CPA
4%
EPC
2%
ROAS
-3%
7

8. Advertiser Program Performance Insights, Jan – June 2013
CLOTHING
Growth in all metrics reflects the
success clothing retailers are having
connecting with and converting apparel
shoppers via the affiliate channel. Online
apparel sales in the US will grow 15%12
next year and apparel (along with
accessories) remain the country’s
second largest ecommerce category (by
revenue).13 But in the network, the
category’s return on ad spend has not
kept pace with the category’s other
metrics, possibly due to strong
competition for customers and
commoditization. Advertisers need to
balance growing their return while taking
care to avoid impacting the growth of
other metrics.
Growth
Clicks
24%
CR
6%
AOV
5%
CPA
6%
EPC
10%
ROAS
1%
DEPARTMENT STORES & MALLS
In the network, the advertisers in the
Department Stores & Malls category on
average grew their clicks (22%) and
conversions (6%), but also saw increased
costs (3%) and a declining return on ad
spend (-1%). Competition is likely
pressing down the average order values,
down 2%. Department store sales,
especially of big ticket appliances, depend
heavily on the financial health of the
consumer sector. Thus, if the US jobless
rate continues to decrease and consumer
confidence rises, this category can
anticipate growth in the year ahead.
12, 13
Growth
Clicks
22%
CR
6%
AOV
-2%
CPA
3%
EPC
7%
ROAS
-1%
eMarketer ecommerce sales forecast, Sept. 2013
8

9. Advertiser Program Performance Insights, Jan – June 2013
FINANCIAL SERVICES
Banking, credit card and tax advertisers in
the network experienced declines in clicks
(-38), mostly due to program changes, and
reaped gains in conversion (9%). The
category’s increase in costs (16%) is related
to changes in the products being promoted
and sold in the channel, namely products
targeting specific, qualified consumers and
which pay a higher bounty to the publisher.
For the Financial Services category,
developing mobile promotion strategies for
the affiliate channel should be key—mobile
banking customers are generally younger
(39% are 18 – 29 year olds) and affluent
(29% are earning above $100K annually)14
and thus recruiting them where they handle
many daily financial tasks is critical.
Growth
Clicks
-38%
CR
9%
CPA
16%
EPC
-1%
Methodology note specific to Financial Services: The metrics AOS and ROAS
are not widely used by this category’s advertisers and thus, were not
included in this report.
GIFTS & FLOWERS
The first half of the year is critical for this
category (Valentine’s Day, Mother’s Day,
Father’s Day, etc.) and on nearly all
benchmarks measures the category
performed well. Gifts & Flowers retailers
increased their conversion rate (7%) while
lowering costs (-5%). Across all categories
in the benchmarks report, Gifts & Flowers
had the highest growth in return on ad
spend (12%). To maintain growth,
advertisers should evolve how they
connect with consumers for the gifting
holidays and have a mobile strategy for the
affiliate channel, as 37% of male shoppers
report they are inclined to purchase
flowers and candy on a smartphone or
tablet.15
14
Federal Reserve Board, “Consumers and Mobile Financial Services 2013”, Mar. 2013
“Valentine’s Day: In Love with Mobile,” Jan. 2013
15 Mojiva,
Growth
Clicks
-8%
CR
7%
AOV
-1%
CPA
-5%
EPC
10%
ROAS
12%
9

10. Advertiser Program Performance Insights, Jan – June 2013
HEALTH & BEAUTY
In the US, health and personal care
ecommerce sales will reach $15BB in
201316 and that number will grow 13%
annually through 2017.17 In the
network, the category gained ground in
average order size (3%), but advertisers
overall were able to maintain costs,
which remained flat, and also grow
their return on ad spend (5%). The
category’s increase in conversion and
EPC are closely tied to the category’s
average decrease in clicks. Additional
growth opportunities for retailers in
this category may lie abroad—global
online spending of health & beauty
products by “cross border” shoppers
reached $8BB in the past 12 months.18
Growth
Clicks
-9%
CR
7%
AOV
3%
CPA
0%
EPC
18%
ROAS
5%
HOME & GARDEN
The vast majority of furniture, home
and garden purchases still occur offline,
but consumers are increasingly
comfortable with ordering these items
online—US online sales are expected
to increase 14% next year and total
$20BB.19 The high average order value
of these purchases make them highly
considered (shoppers typically consult
2 – 4 sites before making a furniture or
appliance purchase).20 Thus even
modest 1% growth in conversion for
this category is notable, as well as the
growth in return on ad spend (3%).
eMarketer ecommerce forecast, Sept. 2013
PayPal, “Modern Spice Routes” report, July 2013
16, 17
18
Growth
Clicks
CR
1%
AOV
2%
CPA
1%
EPC
8%
ROAS
19 eMarketer
9%
3%
ecommerce forecast, Sept. 2013
“The Role of Digital in the Furniture Shopper Path to Purchase,” Nov. 2012
20 Google/Compete
10

11. Advertiser Program Performance Insights, Jan – June 2013
MEDIA & ENTERTAINMENT
This benchmarks report category is diverse,
spanning movie and concert ticket, music,
daily deals, dating and outdoor recreation
retailers (to name a few). The category
continues to be robust, realizing for two
consecutive years, gains in conversion (2%)
and ROAS (5%). Many retailers in this
category did grow their average order size
in the first six months of 2013, but significant
declines dragged down this metric’s
category average. In past quarters, clicks
have seen modest declines, and that would
have been the case here if not for a sizeable
increase in clicks, in anticipation of changes
to US gun control laws, occurring on
retailers which sell ammunition and gun
equipment.
Growth
Clicks
7%
CR
2%
AOV
-1%
CPA
6%
EPC
7%
ROAS
5%
SPORTS & FITNESS
Consumers show a strong interest for
completing their sporting apparel and
equipment purchases online—33% of
shoppers of sporting goods report they
have purchased online after viewing items
in store.21 This strong intent to buy online
may be contributing to this category’s
growth in conversion (9%). The decline in
clicks here is not necessarily a sign that
shoppers lack interest, but more so an
opportunity that sports and fitness
advertisers can improve the quality and
quantity of promotion on publisher sites.
Knowing that shoppers frequently go in
store to research items, for instance,
recommends the potential to close the deal
with a site to store coupon promotion.
21 AlixPartners,
Growth
Clicks
-13%
CR
9%
AOV
3%
CPA
3%
EPC
6%
ROAS
6%
“September 2012 Viewpoint on Retail Performance,” Sept. 2012
11

12. Advertiser Program Performance Insights, Jan – June 2013
TRAVEL
Within the CJ network, the Travel
category saw gains in many metrics,
including conversion (14%) which for
most of last year this category struggled
to show growth in conversion rate.
Continued pricing pressures and
competition for exposure on publisher
sites is increasing costs (1%) and
dampening any gains in return on ad
spend (-2%), but the category saw overall
growth in average order size (3%). The
category’s clicks declined for a second
consecutive year, which can likely be
attributed to a few factors: travel bookers
are conducting more focused research
before booking and a growing confidence
on the part of consumers in best price
guarantee policies.
Growth
Clicks
-4%
CR
14%
AOV
3%
CPA
1%
EPC
9%
ROAS
-2%
12