There has been much debate over the last few months about the role of the agency in affiliate marketing with networks losing the management of top affiliates to in-house solutions. The trend allows agencies to focus on top-tier affiliate strategy, while networks develop the long tail and new affiliate relationships.
The benefit to the client is a cost reduction, not paying an override for those top affiliates (although there is usually an agency cost increase as a result of the additional work), alongside affiliates a channel being managed as part of a wider digital marketing strategy.
However it does have a significant impact on networks, which could lose up to 80% of a client’s revenue overnight. For years they have been building account teams around their biggest clients, making the consequence not just a financial one, but a personnel one too.
It then makes it necessary for networks to develop their technology to attract emerging publisher types and revise their overall service offering to develop long tail affiliates.
Long tail clients
But is there an opportunity with the long tail clients, those steady sales generating programmes that are too small to make the top client list, but profitable enough for networks and publishers to be considered a viable prospect. These clients are often managed by a self-service team at the network, a far cry from the dedicated team surrounding one key account.
The account managers can be juggling 50+ clients and, in our experience, are often some of the most organised and knowledgeable account managers to deal with, returning support queries around with lightning speed and efficiency. The problem is that these smaller clients are also juggling a lot of tasks, meaning that the affiliate programme is not getting the attention it needs to grow from both sides and often stagnates.
Performance in performance marketing
One client we recently worked with, maxcleavage.com, a specialist lingerie site, was close to dropping the affiliate channel altogether until they realised the full potential of the space. They too had great service from their network, but it was all reactive rather than proactive, so they allowed the programme to “tick along” for nearly four years across two networks.
While one of the great benefits of the affiliate channel is the cost-per-sale only model, performance marketing needs to actually perform in order for it to be successful, and like many clients before them maxcleavage were ready to throw in the towel. If 500 other small to medium sized clients did the same across 2014, could this hinder the growth of the performance industry?
One common misconception for small clients is that big affiliates will only work with the biggest brands, which is simply not true. Of course publishers will need to consider their overall earnings and when deciding whether to work with a new client, but it does not mean there is no opportunity.
Quidco, one of the biggest UK affiliates took just three days to put maxcleavage.com live on their site when we asked, and by the end of that week they were already generating sales.
The same has been seen across other smaller clients who often have more flexibility when it comes to creating bespoke and innovative offers leading to much more exciting consumer experience and great results.
Long tail clients, long term strategy
While in theory this is a great idea to grow smaller clients into the next big thing, it is clear there needs to be a shift in thinking. Many industry events and publications are focussed purely on larger brands and some networks have overwhelming start-up costs and requirements that create a barrier to entry.
Clients too need to realise that affiliate is not something you turn on and leave, and that by investing time into you will no doubt have better results.
So instead of fighting over the top-tier clients and publishers, let’s not forget the little clients who could provide long term growth for the performance marketing industry.