We’ve been working a lot recently in the affiliate marketing space, making sure that our clients are in the best possible position to take advantage of the channel as part of their online marketing mix. With our increased focus in this area, we thought we would share our wisdom and spend some time answering the common questions we find in this area.
Affiliate marketing is a paid for digital marketing channel, where you can acquire new customers through using a variety of publishers or affiliates.
Affiliates are paid a percentage of commission for each sale / revenue / lead that is generated. The affiliates are accessed via an affiliate network, who facilitate the tracking and payment, along with supporting the management of the programme if this has been agreed.
There are many affiliate types to take advantage of. If you have never worked with affiliate marketing before, the chances are that you will have come across one as a consumer. Cashback sites such as Quidco and Topcashback are two of the biggest volume drivers, in addition to loyalty sites such as Nectar.
In recent years, the diversity of affiliates has grown, with bloggers and influencers who started to monetise their traffic and followers through joining affiliate networks. Shopping comparison sites have become more prominent in the affiliate space, using the Google Comparison Shopping Service (CSS) initiative to monetise their offering and deliver sales via Google Shopping. This diversity has meant that you don’t just have to rely on a handful of affiliates to drive the volume.
If you look at the headline numbers, 7% to 10% revenue being generated, seems something that is hard to refuse. However over recent years, the question of incrementality has been much discussed, with the value of cashback and voucher code sites under scrutiny. We have looked extensively at the role of such affiliates in the customer journey - are they just goal hangers where you would have got the sale anyway. We have however found that a high proportion of sales are incremental, with the right commission and validation strategy, we see that these affiliates cannot be ignored, especially if your competitors are in the space. It should also be remembered that you can ensure that you control the efficiency of the channel, with a guaranteed Return on Investment.
Many people are cautious about affiliate marketing, with the negative connotations that have long since been in association with the channel. The early days of the industry did affiliate marketing no favours, with poor quality sites and brand bidding two key challenges. With the right approval and vetting process, you have nothing to worry about these days. Using affiliates as a channel can actually help increase both brand perception and the awareness of your brand.
The answer is it depends on the sector you are in, the level of support you need and the markets you are operating in. For example, if you are looking to work with an established network, who can provide support to your in-house team or agency, Affiliate Window, Rakuten and Tradedoubler are typically the top three on my list when I run a Request for Proposal (RFP). I would always recommend pitching your business out to see who is the right fit for your business needs.
Although we do see a handful of brands working with multiple networks, most opt for just one. The main reasons being that you will typically find the key affiliates across all networks and the time it takes to carry out the administrative tasks across more than one network is typically not worth it.
Getting started is simple. Once you have selected your network, the main things you need are banners, a product feed, content for your recruitment page and a strategy for which affiliates you are going to target. Dependent on your platform, the tracking integration may take the most time, however with the support of a good network you can be live within four weeks of signing on the dotted line.
At Customer First Digital we help brands of all sizes take advantage of affiliate marketing. We have a tried and tested method of reviewing the market with our clients. If you would like to understand whether you are making the most of your affiliates or want to understand if affiliate marketing is right for you, get in touch today.
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