
The SEO Dominance of RetailMeNot - zbravo
http://priceonomics.com/the-seo-dominance-of-retailmenot/
======
sharkweek
SEO-driven businesses are super fun to work on and run -- I have a few sites
that rank for informational queries and thus get a decent amount of search
traffic and ad revenue because of it. At scale, it can quickly become highly
lucrative.

HOWEVER, and perhaps call me a giant wuss, but when you're at the mercy of not
only an algorithm but also a savvy business, it's a pretty dangerous bet to
hedge it all on search traffic.

Coupon codes are one of those things I could easily see appearing at the top
of SERPs in no time courtesy of Google.

"Credit card comparisons" and other searches like it are a massively
profitable keyword to rank for. But take a peek now and you'll see Google
threw their hat into the ring, flipped one switch and magically appear above
all organic rankings. They're doing the same thing with travel, weather, you
name it. I can't sit here and argue it's unfair, it's their yard, they make
the rules.

And truthfully, as a user, I completely applaud Google for providing these
services, I love the one stop shop and trustworthy nature of their results.

As a marketer, I'm very, very wary to place any huge bets on any sort of long
term business model relying on rankings. Should it be a tactic in your
strategy? Absolutely. But diversification here is sure going to save a lot of
headaches down the road.

But at the end of the day, as far as RetailMeNot goes, get it while it's good
I suppose.

~~~
jaredmck
Probably a good time to mention that Google Ventures invested in RetailMeNot.

I think keeping these kind of coupon codes as a %rev affiliate model rather
than CPC ads makes it easier to justify the high level of spending (much of
which is cannabilizing other marketing channels) - if it was more directly
comparable to adwords & Product Listing Ads CPC-based costs, I think more
large brands would move faster to cut the wasteful spending going on in these
programs.

Right now many rationalize it as "4% of revenue is a great acq cost" \- but
it's not a true acquisition cost as you already acquired many of these
customers and if the affiliate sites didn't exist, 99% of these sales would
still happen.

If you're a pure SEO built company, are you really betting it all on SEO?
Without it you'd have no company, and if it weren't risky, there would be no
opportunity left.

~~~
beagle3
> you already acquired many of these customers and if the affiliate sites
> didn't exist, 99% of these sales would still happen.

That's only true for a small number of vendors (those that are "unique" in a
relevant way, such as clothing brands). For everyone else, it's a "Red Queen"
style race, where you have to run just to stay in the same place : you have to
do it, because someone else did; if no one or everyone does, nothing changes -
but if only some do, those who do have an advantage.

------
Destitute
As a consumer, RetailMeNot is great. As another website that sells products
for commission, it's terrible. If RetailMeNot can find a coupon that I fail to
mention, that's fine.

But RetailMeNot also steals that last click cookie with coupons that simply do
not work or are not really coupons (Check out the Amazon Free shipping
"coupon" for example). That's nothing but cookie stuffing, and if it were any
other smaller company doing something similar they'd probably get banned from
the Amazon affiliate program.

Basically, imagine you as a website owner buying a product on Amazon and
writing a review about it, reading the review out while piecing together a
video montage that shows it off, taking some pictures of it, and compiling it
all just to get a little bit of commission if someone reads and watches your
review. Then the customer searches for an Amazon coupon before checking out,
goes to RetailMeNot, and then gets the "Free Shipping on 35+ deal" that is not
even a deal or coupon, or even a coupon that does not even work or exist. This
million dollar company has stolen your effort and will get commission on that
sale. It's just rotten from that viewpoint.

~~~
andrewfong
It seems enough to fix on Amazon's end. Just credit the commission to the last
click cookie as of the time the user reaches the checkout page (assuming the
customer actually does close the purchase within a short amount of time).

------
alohahacker
I remember submitting coupons on retailmenot and getting them erased. I
actually remember contacting them to post coupons that could eventually help
their end users and them informing me that they wouldn't post it because it's
not an affiliate code and they wouldn't get paid.

As a user, I wasn't getting paid either just wanted to help out since the
coupon I found was superior than anything they posted for that store at the
time.

Is their mission to help users find deals or pad their affiliate revenue? If
it was the latter, their reason they gave me would make sense.

------
xpose2000
"We take no stance on RetailMeNot’s business model. (We like getting coupon
codes too!) We also have no idea how the company achieved its SEO dominance.
The company has no doubt put a lot of work into conquering Google."

The answer could be simple. As far as I know, RetailMeNot was one of the
original coupon aggregators. (The domain was created in 2006.) It also _seems_
to concentrate on natural SEO and does not seem to be cheating. Combine that
with good quality content and you have solid SERPs.

~~~
yohui
RetailMeNot was also featured on their sister site, BugMeNot, when they
debuted.

[https://web.archive.org/web/20061101212617/http://www.bugmen...](https://web.archive.org/web/20061101212617/http://www.bugmenot.com/)

~~~
NoodleIncident
Finally, some confirmation! The similar names made me instantly wonder if
there was a connection when I saw their booth at a career fair. During the
entire interview process, though, no one I asked had even heard of BugMeNot,
or knew if they were connected. It's just sad, really...

------
MitziMoto
I run an SEO fueled business and it scares the crap out of me; especially as
we hire our first full time employee. The fact that Google could literally
shut down my business at any time keeps me up at night.

My business started as a hobby and has grown significantly (due to SEO ranking
improvements) over the last couple years. We're now at a point where we (my
wife and I) can no longer handle the volume that's coming in. Our options
right now are a) hire an employee to help reduce the load or b) remain small
and stagnant because Google could cut the cord any minute.

I'm trying like hell to find alternate traffic streams like Adwords, Facebook,
Mobile, etc, but I can't quite figure out how to make a reasonable profit with
them. So for now I guess I just have to take the risk. No guts, no glory.

~~~
unclebucknasty
If your profits will increase after paying a new hire, then absolutely,
positively, go for it while you can. It is so difficult to work yourself into
your current position that you must maximize your return while there.

Also, if you have more business than you can handle, then the only certainty
on your decision tree right now is that you will lose revenue if you don't
hire someone to help. Google _may_ hose you (and that may even be likely, at
some point) and you _may_ be able to find alternate traffic streams, but they
are not certain occurrences, nor is the timing of any of these scenarios
(including a Google hosing).

And, of course, if you get help then it may free up some of your time to
pursue the other streams without impacting your current revenue.

If you can mitigate your hiring risks by offering 1099 or contract-to-hire, or
otherwise, that may be prudent.

But, again, you gotta' maximize your profit while you can. Congrats on having
a "good problem" and best of luck!

~~~
MitziMoto
Thanks.

If it was just my wife and I like it has been, I wouldn't mind the risk. We've
gotten this far. My fear is in hiring a new employee and having _their_
livelihood dependent on my business that has a single point of failure.
Granted, it's a fairly entry level customer service position so it's not like
someone's going to retire from the job, but I would still feel just awful if I
had to let them go because we had no traffic due to something like a
"mysterious" Google penalty that I can't figure out and will get no help from
Google on.

I'm hoping we can use the free time we'll have from mundane tasks to think
about how to make the business work with other traffic sources.

~~~
unclebucknasty
> _My fear is in hiring a new employee and having their livelihood dependent
> on my business that has a single point of failure._

Man, I have absolutely been there! I mitigated this concern by hiring part-
timers who also had other jobs. An added benefit was that having multiple
part-timers vs. one full-timer also gave us redundancy in the event of
vacation, illness, etc.

BTW, my situation was primarily with customer service reps as well.

Hiring multiple people does require additional training and administrative
overhead, etc. and your business needs may or may not allow for such a
solution. But, you can also mitigate your legitimate concern by being
completely transparent with candidates with regard to the company's position.
You might even consider offering a little upside bonus for the good
months/quarters or paying slightly higher than market to offset their downside
risk.

Given the current labor market, you will possibly find that candidates who
would otherwise have no prospects are happy to take on the risk of having even
potentially short-lived employment.

In the end, you can find a solution that works for all. Communication and
openness are the keys.

Good luck!

------
InfinityX0
I don't buy the "don't have all your eggs in one basket" mantra here. I get
that idea if you rely on SEO and you have risky tactics, but in RetailMeNot's
case, they have the best user experience and also, up to date coupons and for
that reason are the best result most of the time in the vertical.

If this was a publicly traded company that bought links and had a site with a
shoddy user experience, I'd get the argument that there's significant risk.

In the history of Google there are very few, if any case studies of sites that
A) did the right thing B) were the best result that ended up losing
significant traffic. Most of it is "yeah, we were doing this wrong, but it's
still not fair..". In Rap Genius' case, they clearly did something wrong.

The only exception to this rule is if Google moves in on the vertical and
steals traffic, which is possible with coupons - but there's a significant
difference between completely destroying a vertical and impeding on it
somewhat. Google has moved in on the airline tickets vertical but the
businesses there are still doing just fine (Expedia, Priceline), as shown by
their considerable growth in the last year+. It seems likely that if Google
moved in on this vertical, it would be a similar impact.

In this article, there's little to describe what RetailMeNot does wrong. Yes,
they are somewhat of a parasite, but in many ways they do these businesses a
service by lowering purchase friction by creating an elegant experience for
users. If their UX was substandard, it's possible customers would get lost and
never complete their purchase - this happens time and time again, which is why
CRO professionals can get hundreds of thousands of dollars to optimize a
conversion funnel. In many ways, RetailMeNot is a piece of that elegant
conversion funnel, so they are rewarded as an extremely profitable affiliate
for that reason.

Disclaimer: I haven't taken the time to evaluate their link profile so there's
a possibility that they are doing something risky there, but from an on-page
perspective, they are the best result.

~~~
netcan
There is a sort of arrogance in assuming that risk = factors outside of your
control. Risk is also the likelihood and potential effect of your own
mistakes. Think of it from the perspective elf an employee. What are the
chances that current of future employees or executives will do something to
make Google ban them. Add that to the risk that Google will penalise them for
something not previously considered risky.

Anyway, the hole thing strikes me as fairly risky. That’s not bad, you just
need to consider that this business is less likely to exist in 10 years than
most businesses of its size. That's because of reliance on SEO. It's also the
reliance on the coupon codes themselves. That’s not terrible in itself. Risk
is allowed.

------
rahimnathwani
This line from RetailMeNot's S-1 is interesting:

"When a consumer executes a purchase on a retailer’s website as a result of a
performance marketing program, most performance marketing conversion tracking
tools credit the most recent link or ad clicked by the consumer prior to that
purchase."

I thought that often it was the earliest click (subject to an expiry), and
that multi-touch attribution was becoming more common:
[http://www.clickz.com/clickz/column/2282207/embracing-the-
re...](http://www.clickz.com/clickz/column/2282207/embracing-the-reality-of-
multitouch-attribution)

If you're a CJ affiliate, please share any insight.

~~~
teej
Lots and lots of people are still on old school last click attribution models.
It is more common to actively manage your affiliates and prune those that
"steal" last clicks instead of drive new traffic.

I think more people want to use more sophisticated models but existing tools
doesn't allow you to do it across channels well.

------
rajacombinator
I have no clue about the SEO dynamics but I do know RetailMeNot used to be
more legit and organic user generated. At some point they made a change and
got coopted by companies paying to post codes. Maybe that original popularity
is what gives them search result rankings.

------
robryan
I think businesses that are giving retail me not a commission are largely
throwing their money away.

As described the vast majority of sales being generated are from people that
have already started the purchasing process on your website and are looking
for a discount coupon. Without having any hard numbers from my experience in
ecommerce I think the majority of these people are going to purchase anyway,
regardless of whether they find a coupon. There is a good chance the people
actively trying to find a coupon have already checked out the competition and
are relatively satisfied with your offering.

Price discrimination can be good but I don't think throwing away 10% to
companies like this is the way to do it. I also dislike how they end up
ranking really highly on a lot of your brand terms where I'd prefer my
business, pages we control and 3rd party reviews to rank. Ideally you could
get a coupon page of your own to rank well for the "x coupon" search to get
the same effect without having to give up the 10% or whatever the commission
level is.

------
hazard786
The point which the article makes about Google Ventures having invested in the
RetailMeNot speaks volumes. RMNs business model is absolute cash-cow until a
mass of advertisers change their commission policies, which they won't as they
are amongst one of their biggest affiliate partners.

So for Google, this is a great way for them to monetize their SEO SERPs.
Invest in a company like this, get them to maintain clean SEO practices,
reward them with obscenely dominant rankings against their competitors and
then get the return from the IPO.

After IPO, wean off their reliance on Google with a push into mobile, as
Google doesn't need to protect their investment any more and could disappear
at any moment...

Pretty obvious how/why they have such dominant SEO results across practically
all their markets, including arguably the second biggest market, the UK, if
you ask me.

------
AznHisoka
Opening popups that put the cookie in your browser, such as Amazon???

Am I missing something here? This is cookie stuffing, essentially! There's
nothing white-hat about this at all.

~~~
MitziMoto
And I don't understand why Amazon continues to let it happen. At that volume,
surely they must know.

------
Zigurd
I've been looking at the coupon search business recently and, while I have not
done a comprehensive competitive analysis, I can tell you RetailMeNot just
works a lot better than Coupons.com.

I was sitting outside Macy's using Coupons.com "local search" and got no
Macy's coupons. Oh but they are a "featured coupon!" You have to use that
category to find them. Bleah.

All the coupon sites are limited. But RetailMeNot isn't overtly lame. They
don't pretend to do things they can't. Local search works. The mobile apps
work. They stay away from stuff that would not work on mobile and that burdens
the user. They suck less. That's often a winning strategy.

~~~
TheBiv
RetailMeNot has a completely different business model than Coupons.com, so it
is an unfair comparison of two sites that look similar.

RetailMeNot makes its money through connections with LinkShare (LS) and
Commission Junction (CJ). And LS/CJ make their money by establishing
relationships with the online vendors for major brands/retailers with online
coupon codes.

Coupons.com makes its money through connections directly with major CPG
(consumer processed goods) brands, where Coupons.com provide CPG's with
distribution of printable manufacturers coupons.

RetailMeNot has been trying to get in Coupons.com game (bc of the less
reliance on search/affiliate networks) but to date, they have been relatively
unsuccessful.

~~~
Zigurd
Yeah, printing coupons securely is hard and very Windows PC oriented - mobile
unfriendly.

------
porker
Can anyone shed light on _how_ they do their SEO? How do they get #1 for so
many terms?

~~~
twoodfin
I don't know anything about Google's current algorithm, but I would be
surprised if they don't factor click-through and other user "satisfaction"
metrics into page ranking. Someone searches for XYZ coupon, clicks the
RetailMeNot link and doesn't immediately hit "back", RetailMeNot wins some
PageRank.

~~~
davemel37
That is definitely a ranking factor although not influencing pagerank.

I think that coupon codes get lots of natural links and sharing because they
drive immediate value.

Also, by updating their content constantly to be fresh, that also helps.
Google definitely has a way to see which site has the freshest coupons.A site
like RMN with the freshest/most recent updates might rank higher.

------
drjacobs
Its nice to see Goodsearch showing up on the board as a competitor these days.
I've been working as an engineer and the primary technical SEO there for the
last year and a half. Goodsearch takes this somewhat shady business model and
at least tries to do some good.

I've been able to 5x our organic coupon traffic over the last year but you
reach a certain point where the top competitor is just too entrenched. I
definitely worry about this being a parasitic practice and Google has been
favoring brands more and more in the SERPs. I'm surprised they are getting
such a high multiple on their revenue considering the risks.

------
adventured
I'm always astounded at what some SEO positions can generate. Coupons.com is
also worth around $1.5 billion. Or take Demand Media for example. They've been
less prominent since the first Panda update hit them, specifically eHow took a
beating. Their stock has languished, but their sales have continued to climb
(almost $400m over the last four quarters).

Does anyone compile an estimate for how much revenue Google is directly
responsible for generating for other sites via referrals off their search
engine? I'd be curious to know how that compares to their take via AdWords and
AdSense.

------
BorisMelnik
Great post and they are really doing it right. That amount of traffic from
search is impressive. On the other hand this industry is about to die. One of
the most exploited niches in affiliate marketing right now. Retailmenot
actually is doing it right, but sites trying to mimic their success by
generating totally bogus promo codes are rising to the top of the SERPs,
dropping their affiliate cookie and profiting.

------
davemel37
I have no doubt that affiliate networks will move into multi-click or other
more dependable attribution models.

I would be more afraid of changes in attribution than getting slapped by
Google.

------
pjmlp
And this is why I keep cleaning my cookies and surfing in private mode.

~~~
netcan
How does this affect you?

~~~
pjmlp
I don't like to be tracked.

------
whoismua
Google Ventures was an investor in them.

Google wouldn't do that? Not so sure these days.

I also think that Google picks by hand the first few sites for top categories.

~~~
paulbaumgart
I doubt it. Credibility is much more important to Google than a few million
bucks from unfairly privileging an investment of their venture arm.

