The Future of Affiliate Marketing with Matthew Lloyd, MySale

Michelle Lomas: Hey there, hustlers. Welcome back to the show and do we have a treat for you this week. In this episode, I have the pleasure to sit down with Matthew Lloyd. Matthew has held many roles in the performance and affiliate marketing space from Mycel Group, Catch and more. He's a veteran of the affiliate marketing industry.

Michelle Lomas: Having worked in affiliate marketing for over two decades globally, Matthew has seen it all. In this conversation, we talk candidly about the future of affiliate marketing, what's working, what's not, and how brands should be looking at affiliate marketing in the future. Well, Matthew, thank you for joining us today.

Matthew Lloyd: Pleasure.

Michelle Lomas: You are someone who has been working in the affiliate space for quite some time and have a lot of really interesting viewpoints on, you know, the future of affiliate marketing. And so I really wanna dive into that today. So, um, for the listeners out there, maybe, let's just start off with a quick intro.

Matthew Lloyd: Yeah, sure. So I've been in the digital space since 2000s, so probably one of the dinosaurs. There are a few out there that have been in the industry longer. I got into affiliate marketing back in about 2002, 2003. I got a phone call on a very rainy day from a guy who I'm still in touch with, saying if would I be interested in free traffic to a website?

Matthew Lloyd: Well that's, to me, that's a no-brainer. Free traffic, don't have to pay for it. So that's how I really got into it. And he was explaining that like, we'll only charge you if you convert. And I thought, well this is a win-win. I worked for one of the biggest affiliates in the United Kingdom money.co.uk, which was fantastic experience.

Matthew Lloyd: I learned a lot there. And then whilst I was working there, we immigrated as a family. We were a very young family. I worked for Hitwise, which a lot of people will remember, and a couple of large companies here in Australia, including Catch. But I'm now currently at OZSALE who are now part of the Frasers Group out of the UK.

Matthew Lloyd: So it's almost like I've gone back to the UK but not physically.

Michelle Lomas: What are you currently doing at OZSALE at the moment?

Matthew Lloyd: I currently look after all the digital performance, so we're a small team, so that pretty much includes everything. That's your traditional page search, the affiliate space, we're looking at expanding more into the social elements as things as well.

Matthew Lloyd: Obviously with TikTok becoming quite a large player in that space, so we're sort of broadening out that digital performance element.

Michelle Lomas: Yeah. Great. And how are things going? I mean, from a performance perspective, you're obviously looking at all the different channels. How is affiliate playing against some of those other channels that you're playing in?

Matthew Lloyd: Yeah, it's really interesting. I only think there is one performance channel, and that is affiliate marketing. Mm-hmm. To me, performance is: you credit someone when they've actually performed, you don't credit someone that you pay in advance for. So I think there's a place for everything. But in terms of how I define performances, someone has done something for you in advance.

Matthew Lloyd: Now, digital marketing as a whole, everything is different. Obviously the biggest player in the market is Google in terms of digital spend, assuming the American government don't change things, uh, TikTok is obviously becoming a very big player in the Australian space, and I think this has been a shift definitely in the last six to nine months is the influencer space, which has been very media spend, as opposed to performance measured. But we're seeing quite a few companies coming out of Europe in particular that are really changing the space when it comes to influencers. And we don't have to worry so much now about paying an influencer upfront and to us as a small business that is really great business for us. So it gives us an opportunity to work with a lot more influencers than we would've been able to have done this time last year and, and I think that's fantastic for any business.

Michelle Lomas: Yeah. And so what are some of the examples? What are they doing in the space that's really exciting you?

Matthew Lloyd: Yeah. I would say four or five out there at the moment that are really promising. They are fantastic, they go and source the influencers for you. Obviously we are allowed to vet them. They'll go out and come back to us, and what these new softwares do is that they say, well, we will give them value upfront in terms of they will pay on a CPC, which is pretty much unheard of, but as the merchant, we actually pay it on a CPA. So that's a really big change. So to us that's fantastic. I think it's gonna take us probably about 18 months to see the full value of it. I think there's some really good traditional performance influencer companies out there, and I think we can probably name one of them. And that's, uh, LTK. So they've been on the market for a very long time.

Matthew Lloyd: So they have a completely different business model. But, um, they're all in that sort of mix. And I think, yeah, we're probably judging by what other companies have been said, we're probably looking at about 18 months, 'cause generally speaking, that seems to be where the, the, the sweet spots tend to be.

Matthew Lloyd: But we may find it accelerates a lot more quickly with this new. Systems or system that is coming into place.

Michelle Lomas: It baffles me a little bit how it works, right? It's shifting the mind, like you're never gonna shift the mindset of an influencer, that their followers are the most important number known to mankind, and that their influence is the biggest influence in the world, right?

Michelle Lomas: And so you are never gonna convince them that, yeah, you, you sent out content to 2 million followers, but I only got two sales. It's not a good thing. And so, you know, they're not working to sell products, that's not how they're building their platform. So monetising them in a way that they understand while also monetising brands in the way that they need is the right step forward.

Michelle Lomas: But it it, how does it work?

Matthew Lloyd: To me, follower numbers are vanity. And in the past it's said, oh, you get this reach, you get this, and I think, well, that's just vanity measurement. But what this does, and the ones that we've been working with, we'll get reports, so we get total transparency. We understand how many clicks they send, what they're converting, and I think that makes the difference.

Matthew Lloyd: But I mean, the belief more in hope that when they start working with us, they'll see the value in terms of right. Okay. We're getting gifting, we're getting CPC. They're getting both ways. I know stories are very keen, but we've got a really great bit of content that doesn't last 24 hours, um, but last for months.

Matthew Lloyd: Then there's gonna be extra value add from them, 'cause they then get a constant stream of income. And I think that's what the mindset has to change. And I think that's gonna be really interesting to see how that travels over the next 18 months and I, I'm excited because I think it's gonna open the opportunity to more and more, and we do have people reaching out to us.

Matthew Lloyd: At the end of the day, we wanna have a great reputation for offering a great service to them.

Michelle Lomas: It's a nice way of looking at it. Obviously, they build followers to make money. The dream is to just be able to create content and live off that and build your following so that you don't have to have a full-time desk job.

Michelle Lomas: Right. So understanding how to commercialise that in a better way. Hopefully most are very open to it. What's been your experience so far? You know, particularly these Aussie influencers where this is a bit of a new concept?

Matthew Lloyd: Well, it's very new. We've literally just finished our first campaign.

Michelle Lomas: Oh, good.

Matthew Lloyd: Look, I'm hoping that we, we can build it to the level that we have with other affiliates.

Matthew Lloyd: They're gonna be those who just want the quick win. Absolutely. And I understand that. And they wanna move on to the next thing. But I think there's also gonna be those who understand the longevity of it. You know, we we're sitting down with a couple and first thing is, what can we do better? Yeah. I think that's, how can we help them more?

Matthew Lloyd: And you know, what have we learned? Uh, how can we incentivise, not necessarily in money, but you know, how can we incentivise in terms of levels, service, et cetera. And I think that's the important thing, 'cause at the end of the day, what's really important about the affiliate space, it's all about relationship building.

Michelle Lomas: So you mentioned, um, evergreen content, which, it makes sense almost taking like the blogger publisher style content where you know, who specialise in a certain topic. When that content is evergreen, they can continue to make money off that content eased down the track. I guess my question to you is, what does evergreen content look like in the context of OZSALE?

Matthew Lloyd: Yeah, it is. It's different ways of looking at it. And again, that's something that we're learning. I think the vloggers are particularly strong in this space. There's a couple in the UK and you look at some of their videos. And they're still getting views years after they've done it. And the really good ones are out there and they list all the products that they wear.

Matthew Lloyd: They put a link to all the products using their affiliate links. And I think people, it's not just about Instagram, and I think people have gotta get away from that mindset. I mean, unboxing is almost as old as YouTube is old, and I'm amazed people are not putting a little bit more into that. And so it's like, right, I've got this and I can link the two together as opposed to this just sort of 24 hours or blitz sometimes on, on Instagram.

Matthew Lloyd: I understand you get a, an instant lift, but at the same time you can also look at it in a different way and say, oh yeah, well if I do this as well, I can also link here, here. And you, you use things like linktree and things like that. It's a win-win for the influencer for sure.

Michelle Lomas: That's so true actually. Like you mentioned tactics like unboxing, which have been around forever, so it feels like the, since the dawn of, of social media almost, but why, like, why do we continue to chase kind of the next best thing in the shiny thing when there's still proven tactics and content out there that people are still engaging with?

Matthew Lloyd: Yeah. Look, I think to me, writing a blog and I have my own little blog, we won't mention it. It's, pretty, I, I dip in and out periodically. It takes a long time to do your research and put content together. Yeah, it's, it's hard. So I think, and if you get your SEO right on your content site and you get it right on YouTube, it's there for ages.

Matthew Lloyd: I mean, I'm looking up things at the moment on, totally irrelevant to work, the greatest examples to me are the vlogmas videos. I love those.

Michelle Lomas: What are vlogmas? I don't even know what that is. Explain it. What is that?

Matthew Lloyd: Oh, so, um, outta the UK, Zoe Sugg, I think she started doing a video every day in the run up to Christmas about 10 years ago. And they're just massive. And you watch those every year now. And, um, It's funny entertainment. It's almost like an event calendar online.

Michelle Lomas: Oh, my son watches some actually funny that.

Matthew Lloyd: And yeah, a bit more adult.

Michelle Lomas: Yeah, I'm sure those are a bit more adult. My sons are more like toys and decorations to decorate the house and stuff. But yeah, same, I guess same sort of concept, a bit like the event calendar.

Matthew Lloyd: Yeah, they're brilliant. All the UK, big UK ones. I suppose off the top of my head, Fashion Mumble would be the biggest, uh, I would've thought, uh, in that space. So of those that I'm aware of, and we have a few family favourites that we follow every Christmas, but they're, they're great.

Matthew Lloyd: You know, and once you put something up on the web, it is always there.

Michelle Lomas: Yeah.

Matthew Lloyd: You've gotta remember that.

Michelle Lomas: Yeah.

Matthew Lloyd: And, um, has its, has its advantages, it has its disadvantages. But yeah, I think if you are in that space, yeah, you probably wanna push it a bit more, or a thought.

Michelle Lomas: I'm sure like there's a lot of influencers out there who could use having a chat with you to give them some ideas on how they can start to be a little bit more commercial.

Michelle Lomas: But it's a challenge, I think, when Instagram continues to be the dominant channel. They position themselves as a shopping channel, as a place for brands. Unless you are using some of those 24 hour tactics like, you know, stories, et cetera. Instagram algorithm hurts you as an influencer, so it's almost like the tools are against you.

Matthew Lloyd: I agree with that. And I think the other thing we have to take into account is the demographics as well. When I started back in 2000, I worked for a new media agency and we had a thing called the Red Bible, and one of the articles in this was about how many touch points you required back then to get a conversion.

Matthew Lloyd: It was seven. Not now. The latest one I read last year was something up around 27. Mm. So, you know, there's no funnel anymore. I, I'm not a believer in the funnel. I know that's gonna be very controversial. I, I believe it's almost like a bowl of pasta, spaghetti, whatever you wanna call it. And if you are not in that bowl, you're not gonna get eaten by that user.

Matthew Lloyd: And the top of the funnel, as people like to call it, is also the bottom now. Now we're seeing that now with influencers now and vice versa. You know, things that were, were at the bottom and now possibly more towards the top. People are just digesting things completely differently to the way they used to.

Matthew Lloyd: Yeah, and I think we have to remember that.

Michelle Lomas: I completely agree with that. This kind of concept of the funnel and there's a three part stage and you move from one part to the next and it's kind of like that's how you make a decision is so antiquated, in my opinion. Even us, you know, strategists, we sit there and try and talk about the funnel yet because it helps us, but that's not how consumers are making, you know, product decisions.

Matthew Lloyd: No, absolutely. They're not. I mean, I'm walking into a store. Well, I'm not, but you get the gist. I'm walking into a store and I'm gonna buy product. And then I think, ah, right now actually, I'm gonna look this up on my mobile. So there's your digital straightaway. Then you walk outside and then you see a billboard and you think, oh, that shop's got it.

Matthew Lloyd: And then you go to that shop. Mm-hmm. And then you check your mobile again and they've got a coupon code. Do I want that coupon code?

Michelle Lomas: Yes. I was about to say-

Matthew Lloyd: There's a, there's no funnel in that.

Michelle Lomas: There's none.

Matthew Lloyd: A lot of people are gonna shoot us down for these sort comments. I get that. I get that. But I've been a true believer that it's not really there anymore.

Michelle Lomas: I definitely feel like every consumer's pathway is so different. You know, there's a lot of channels that are coming and going. You talked about social and the fact, you know, we've gotta stop thinking and putting all our eggs in one basket with Instagram. What are your thoughts for the future here?

Michelle Lomas: Because I know you've got some big thoughts around the challenges with the so-called customer journey and the unpredictability of the future of some of these platforms.

Matthew Lloyd: Yeah, look, I think the main one is content. Content is the bread and butter of SEO. You know, it's what people are digesting and I think that is gonna come back quite strongly.

Matthew Lloyd: I think some of the big Australian media companies have been at least five to 10 years behind the rest of the world. Yes, when it comes to content strategy. Thankfully, they are now catching up very quickly, which is great. I think what it will do though, which will make it a little bit more tricky, is that tenancy fees, and those of you who don't know what tenancy fees are, they're like paying someone in advance, which is kind of what we'd like to try and avoid in the IT space.

Matthew Lloyd: So I think if you get that right and you sit down, whether that is a major newspaper or blogger who specialises in a particular area, then I think that's where it's going to go more towards this sort of American model where. You, you pay more tendencies. But I hope it doesn't destroy the content piece.

Matthew Lloyd: Sometimes they reach out to you and they want X amount and you think it doesn't really warrant that amount of money, but we're more than happy to help you in other ways. I, I won't go into that 'cause that's actually strategy, but I think that'll probably this time next year without a doubt. I think one more Christmas and I think we'll see some of the really big content guys.

Matthew Lloyd: Here in Australia, they really understand the industry in terms of affiliate, and I think that's really encouraging and particularly as we are predominantly in the fashion space. I'm hoping it help us, but I think it's gonna help everyone. You know, it doesn't matter what your vertical is, as long as you are targeting the right publications and the right areas in those publications, I think that's gonna be a win-win long-term, particularly if you can get evergreen content.

Michelle Lomas: And so what are some of the things you feel the Australian market are behind that they need to catch up on?

Matthew Lloyd: I think that's it. I really think that is truly it. I was in the UK about four years ago for PI Live. And it was quite interesting seeing the difference of what affiliates were offering in Europe to what they're offering here in Australia.

Matthew Lloyd: And honestly, it wasn't really that different. I think the only real difference was they had slightly more advanced software companies out there that aren't available, but that's fine. There are some big, very big players in Europe who have landed on Australian shores. I won't mention who they are, but I think that's really encouraging that they'll see the Europeans are trying to expand. We don't really see many of the Americans coming here.

Michelle Lomas: Too small a market in their eyes, I'm afraid.

Matthew Lloyd: Yeah. But I think the Europeans could look at us as being quite a small market as well. But there seems to be a great encouragement. One of them is in that influencer space.

Matthew Lloyd: I'm very encouraged to see them here, so I think there's gonna be a good mix coming through, and it's a really small industry, even globally. So I think once people start hearing good things out of Australia, more and more of the European players will be coming here. There's no doubt about that. I hope so.

Michelle Lomas: I worked overseas for a number of years, um, in a publisher as well at Hearst in New York. And, you know, entire sites built off the back of affiliate marketing in Hearst that were extremely profitable for the publishing house. And, you know, there was, there was never any doubt that affiliate marketing was a tactic that needed to be deployed within the business and was highly profitable and had that, I'll call it the SEO effect. You know, it starts off slow, but it just continues to make money years on, you know, so it takes time to build, but it definitely has a lot of groundswell. And so then coming back to Australia, it seemed, to your point, I think it was behind but it's not behind because there isn't great publishers and great content creators. I think there's a mindset that still just needs to shift, and that is that affiliate marketing is not something that's just another tactic that you put on the back of your media plan.

Michelle Lomas: It's not measured in the same way. It's paid differently. It should be considered differently. And it almost feels like there's just more of a mindset shift more than anything else that needs to happen. And once publishers and you know, those tech players also come in and start to reinvigorate sort of the industry, we'll start to see a shift in that concept of, okay, all right, this can actually be really good for my business because I'm only paying for that sale.

Michelle Lomas: But also it's good for the brand. It's helping your product get in front of consumers when they're looking for that content.

Matthew Lloyd: Oh yeah. Oh, you've got me going now. Okay. So there's a couple of things. Um, I just wanna go back over the original question. I think what's really encouraging is the diversity within the current affiliates in Australia.

Matthew Lloyd: More and more of finding different ways yes, to monetise. And I think the other thing I think companies have gotta understand that you don't budget affiliate marketing like you do with your paid. Yeah. Now the amount of times, oh, this is your budget, forget it. Do never set a budget for affiliate marketing ever. Around tenancy fees, fine. I get that. Absolutely. But the amount of times I've seen companies who've limited their, or tried to limit their affiliate budget to those who are unlimited. It is chalk and cheese in terms of performance. I think the other thing you've gotta do, and I periodically do this, it's worked out how much wastage I've paid for a click in advance to what I haven't wasted on an affiliate click.

Matthew Lloyd: So basically the amount is wastage in pay search compared to affiliate and people forget that. Yes, there is volume elsewhere, I get that. But if you get a good mix and you slowly build it up, are you gonna get a great mix of people who are gonna assist you. Get those interviews through the front door, then purchase whether they are online or offline now.

Matthew Lloyd: And there are a couple of affiliates now are really going hard offline. That is something we were not talking about three years ago, so it's easy for accountants to understand paid. It's very difficult to understand affiliate in terms of budgeting in that respect.

Michelle Lomas: Yeah. But you raised such an interesting point, which is don't put a budget on it. If, I mean, to be fair, we have had people on the show, for instance, we had Sam Viney from Lounge Lovers, and he talked about affiliates sometimes can impact his business based on the margins and shipping and delivery costs. So there are always circumstances in which there are some categories that do have to limit that.

Michelle Lomas: But having said that, if it's working, particularly in your industry in fashion, there are some categories where it doesn't make sense to turn it off if it's working, keep going.

Matthew Lloyd: What we learned from the global finance crisis and definitely during Covid is how many people pulled out of paid and went into affiliate marketing 'cause they can control their budgets from a profitable point of view. And I understand where you're coming regarding that last comment, but you just change your margins in your commission rates. It's as simple as that, and what I love about affiliate marketing is you are always learning something new.

Matthew Lloyd: And the reason is because it's not becoming automated. Not yet. You're dealing with individuals, someone new. That was some crazy idea of a comparison site there. I won't mention the subject, but it was definitely adult orientated.

Michelle Lomas: Got it. We had Lovehoney on here one episode. It's all good.

Matthew Lloyd: Oh, they're a great team. Great team. I met them, they're a great team. And um, but you've got some fashion comparison sites. Oh, they're bread and butter for us. And there's always someone new coming on and so you have to understand, and I will mention him, Chris Tragit, who used to be at Bayat, which was one of the original networks. Um, I have to thank him because the second I hang up from that phone call on that rainy day in Putney, I've never really looked back. I just love the space. It's evolving the whole time. And someone new is coming up with something different all the time. New users coming in and people thinking of new ideas, and it's just so encouraging that people are so creative and they want to come up with something that's completely different. It's just, the diversitys amazing.

Michelle Lomas: Yeah. You know, we've had a few guests on the show who've talked about chatbots and other things that they've leveraged from an affiliate marketing perspective, and so there's a lot of different ways as well.

Michelle Lomas: It's not just influencers on social and some cashbacks and coupons. There's so much more out there to be had and that's growing, to your point, constantly.

Matthew Lloyd: It is.

Michelle Lomas: So I'm gonna end with a question. There's a lot of people who listen to this podcast who might be new to the space, just trying to get their head around it. What advice do you have for them?

Matthew Lloyd: Get into it. Whether, whether you start in your bedroom, trying to be an affiliate. Whether you are in marketing or to be quite honest with you, even if you're not doing marketing, I think sometimes the best people I know in the affiliate space have never had a marketing qualification in their life.

Matthew Lloyd: It's all about being nice to people. Sounds a cheesy thing to say. Doesn't it? Being nice to people, just being nice and read. I read every day. I read three to four different newsletters every day. You just gotta read. How do you get into it? Just go onto Seek or LinkedIn and look up an affiliate marketing role.

Matthew Lloyd: The way I got into this, I was working at British Airways and they had a system there called Amadeus, which is still around, shows all the flights in the world. And I was selling holidays and I thought, well, this is interesting. We're selling holidays over the phone and we got this thing called Amadeus and there's this new thing called the internet shows you how long ago.

Matthew Lloyd: And so I went to marketing and I said, Hey look, there's this new thing called the internet. Can we just take Amadeus, take our data, mash it together and create one of these website things? And I said, well, interesting you should say that. Anyway, this conversation sort of dragged on for about six months and there was no opening for me probably 'cause I did not have a marketing qualification.

Matthew Lloyd: And, I was just talking to a colleague, literally in the department next to me and her partner was the owner of a new media agency, and that's how I got into it. It's just ask, and the one thing that you will learn about affiliate marketing is that you learn on the job. There's absolutely no other way of doing it.

Matthew Lloyd: You can read about it and things, but you just learn and learn and learn from others and now reach out to people. I have people sometimes reach out to me and I always try to be honest and frank, but yeah, if you're in a big team, small team, or you are in a small business and you're not doing affiliate marketing.

Matthew Lloyd: Go to your owner and say, Hey look, there's is old guy. he's talking about affiliate marketing online. I reckon this will work for us. And you know, there's some great networks out there that will be more than happy to help, and help you build your business, and there'll be a lot of opportunities. It's not going to be a golden egg, silver bullet, whatever you want to call it.

Matthew Lloyd: It takes a lot of hard work and it will take years to build up a really good affiliate program. I think people have to be patient on that. It's not an instant win. Yes. There, there are elements that are low hanging fruit, absolutely.

Michelle Lomas: But yeah, I completely agree with, you know, just getting into the space to the industry is still small and it's still relatively new in terms of hitting that sort of mass reach for a lot of marketers, and that means that there is a skill shortage out there. And so for anyone thinking about getting into the space now is the time. I'd say it's only going to evolve with technology and capabilities and publishers jumping on board.

Michelle Lomas: So it's a really great time as well for anyone considering to maybe shift their specialty to jump on board.

Matthew Lloyd: Yeah, and to be quite honest with you, my job is very diverse. I take up lots of channels, just add it to your channel. Just add it to your channel of mixes that you work on, and away you go.

Michelle Lomas: Yes, there's literally nothing to lose, only only sales to be gained.

Michelle Lomas: Maybe a little bit off, off the bottom line, but, uh, it was really great to chat to you. Really interesting and compelling conversation. Really appreciate your experience. In the space and your eye towards the future as well and what that brings. So thank you very much for bringing your honesty to the table.

Michelle Lomas: I think we had some good chats, really appreciate it. And you know, maybe we'll talk again soon.

Matthew Lloyd: That'd be fantastic.

Michelle Lomas: Well, I hope you got a little bit of inspiration from that great chat with Matthew. I know I did. Next week we have another great episode. Here's a sneak peek.

Julia Stevanja: So really interestingly, we expected to be largely coupon and sales driven. And when we first started this, that was absolutely the place we started, 'cause it's easy to attract customers with that. But the research that we did both externally and we ran a survey as well to over a thousand shoppers, and we asked, why do you subscribe to brands? And there was a whole bunch of different questions, but what came about was truly that it was about 50/50 sign up and follow a brand because they wanna know about the sales, they wanna discount code, et cetera.

Julia Stevanja: Or they wanted to know when new collections are coming from that brand and wanna stay in touch with that brand.

Julia Stevanja: That was much higher number than I thought. I really thought that. Interesting. You know, 70, 80% of people are signing up for that coupon code.

Michelle Lomas: If you aren't already, don't forget to follow, so you don't miss an ep. And while you're there, why not drop us a rating and review? We'd love to hear what you think. Flex Your Hustle is made possible by the great team at Commission Factory and produced by Ampel. I'm Michelle Lomas. Keep hustling and bye for now.