After acquisition by Walmart, Flipkart has reduced commission and capped the sales driven by affiliate partners drastically. Over the past couple of months, the online marketplace has limited the volume of business coming from affiliates, in a range of from 90 to 50 per cent (depending on nature of traffic and categories).
Smaller affiliates lost as much as 80-90 per cent of their business. Entrackr has confirmed this with several Flipkart affiliate partners and also seen multiple emails sent by Flipkart to its partners. Three affiliates that used to do about several lakhs commissions (via sales generated in crores) with Flipkart are now capped to process monthly leads up to Rs 9,999.
Meanwhile, the company has slashed commission to 7 per cent from 10 per cent in fashion and accessories categories. It also reduced commission on smartphone sales of Samsung, and other manufacturers (excluding RedMi and Apple’s iPhones).
“We have currently paused new affiliate registrations w.e.f. 5th May 2018 until further notice while we work on developments and improvements to the FAP(Flipkart Affiliate Program) platform,” mentioned the e-commerce behemoth on its Flipkart Affiliate site.
Given that a major chunk of affiliates business hails from fashion, their earnings have taken a toll. “We aren’t shocked by a reduction in commission but the cap put to monthly volume allowed on Flipkart,” said three existing affiliate partners of Flipkart.
While smaller partners have been struggling, larger affiliates such as CashKaro, CouponDunia, and others have regained about 50 per cent volume (they had lost about 80 per cent business from Flipkart) in the past 15 days.
“Our volume from Flipkart had slipped to 80-85 per cent in May, however, things got better in past two weeks as we brought back about 60 per cent of the lost business,” said two affiliate partners. They requested anonymity because of existing relationships with Flipkart.
A decision of cutting down affiliate business comes after months of Flipkart acquisition by Walmart. Observers point out that the e-commerce major has been going through several changes after Walmart deal and restructuring in affiliate programme could be a result of larger play or strategy in the offing.
Since Flipkart is cutting down the volume of orders from affiliates, Amazon is the only large horizontal player to rely on them. In the past, Snapdeal had put a halt on its affiliate programme, however, the company recently resumed it.