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Five Easy Steps to Improve Affiliate Programme Management

Five Easy Steps to Improve Affiliate Programme Management

Affiliate marketing is a performance-based channel that works for the mutual benefit of brands, customers and a third-party intermediary. The model, in its basic form, is very simple – a business will tap into the huge audiences that an affiliate website has by providing that affiliate with content to push to its customers, which is often in the form of a voucher code or cashback offer. The affiliate is then, in turn, rewarded a commission from the brand for every sale they drive. Easy, right?

Despite the simplicity of the model, affiliate marketing is constantly changing in response to new market conditions, and that means the way in which affiliates drive sales is continually adapting. There is one element, though, that does not change - whichever affiliate site the customer clicks on last before making the purchase, wins the commission. That makes it relatively easy to align a brand’s goals with the goal of the affiliate, which is simply to earn that ‘last click.’

The good news is that there are five different tactical ways in which you can improve the performance of your affiliate programme channels.

Step 1: (Re)-define your objectives

There are various different goals and objectives you might have for your affiliate programmes. For example, they could be a way to drive sales, acquire new customers, boost profitability or gain market share. Each of these goals requires a slightly different approach for managing an affiliate programme. The problem is that, very often, older programmes have moved from their original objectives with no new strategy in place.

This makes it important to define a cost of sale for the affiliate channel. If you find that you are not reaching these goals, then you will need to re-evaluate your overall cost structure. Moreover, if you find that results vary widely, from month to month, or from quarter to quarter, you may also want to redefine your objectives going forward.

Step 2: Fully understand your data and KPIs, and monitor them

In many ways, data is the key to the optimal performance of your affiliate programmes. The more data you have, the better. It’s important to put into place key performance indicators (KPIs) that are integral to the performance of these channels. Each KPI will tell you how well you are achieving certain targets.

This means that you need to closely follow up on your tracking reports as much as possible. One way to do this is by examining who is driving sales, voucher codes being used and the products being sold. You need to know what your affiliate data is telling you, and how to recognise when the data isn’t making sense. That could be a sign that the strategy for the programme is no longer working for some or all of your affiliates.

Also, consider how the conversion rates from your affiliate channels relate to your overall conversion rates, or those from other channels. Look at regular reports to spot wins or emerging trends and issues based on the richest possible data. As needed, communicate what you are finding with key publisher partners.

Step 3: Understand the different publisher business models

This may sound obvious, but some companies don’t actually know what an affiliate does to generate traffic and sales. As long as the sales are coming in, they don’t question the selling tactics of a publisher. However, by taking a finer-grained look at the overall publisher business model, you may get a number of insights into the types of advantage - or disadvantages - they bring in terms of fulfilling commercial objectives.

One basic example of how publisher models differ is the difference between cashback codes and voucher codes. These both have large audiences and have the potential for new customers. However, they can be used in slightly different ways. For example, they could be used to increase market share or share of voice in addition to driving an overall increase in sales. By studying data over time, you can fine-tune your overall model.

Step 4: Don’t be afraid to experiment

The affiliate marketing landscape continues to shift, and that means there are alternatives to pure CPA to achieve branding. Best of all, these alternatives can be achieved within the target cost of sale for the channel.

One way to experiment is to use different promotions for different affiliate categories. There’s no rule that says you need to give every affiliate the same promotions. Also, don’t be afraid to run something short-term and aggressive. This is particularly true around key selling periods, such as the winter holidays. Voucher codes can be particularly effective in driving overall sales at a time when customers are in active buying mode.

Step 5: Be creative in your communication

Affiliate marketing is such an entrenched practice among brands that they sometimes think that there’s no need to be creative or innovative. That couldn’t be further from the truth: don’t be afraid to make some noise. Sometimes, in order to cut through all the clutter, you have to be creative.

Also, be sure you open up the communication channels with your affiliate publishers. Communicate the brand and offers to your publishers regularly through relevant messages. This will help them on their end to craft the most effective selling techniques. Also, ensure what is available to publishers is up to date - avoid out-of-date brand images and colours. These are often confusing for consumers, and could lead to unexplained dips in sales.

Poised for success

Using these five steps, it’s possible to boost the performance of your affiliate marketing programmes. Make sure you define (or re-define) the objectives, constantly monitor and analyse your data, understand the variety of publisher models out there, experiment, and remain creative in your communication. Each of these steps will help to calibrate expectations and incentives between brands, affiliates and customers.

By making this an iterative process of continuous review and improvement, you will be poised to have a successful affiliate marketing programme. And, most importantly, you will be well-positioned to make strategic shifts whenever the structure of the market shifts.

The affiliate marketing model is continually evolving, so you want to make sure that you are well-prepared for any changes when they occur.

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Bruce Clayton

Bruce Clayton

Co-founder and director at Optimus, Bruce has extensive experience in both online and offline marketing.

He has worked in TV, radio and for online media owners before moving to the agency side in 2006, when he co-founded Optimus Performance Marketing. The company delivers digital marketing solutions and consultancy to a wide variety of clients, focusing on driving outstanding results and measurable ROI.

Read more from Bruce

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