This article first appeared in the 'Affiliate Expansion' resource - sponsored by Acceleration Partners - designed to tackle all aspects of launching a programme in a new market. You can download the full guide for free here.
While it seems logical, simple even, for an advertiser reaping success in its home market to begin buccaneering overseas in a bid to further its reach and audience, international expansion is anything but straightforward.
That said, the inherent architecture of affiliate marketing, one that revolves around relationships and local knowledge, can put the advertiser in better stead than some counterparts when they arrive at the decision to expand into new territories.
In order to get a grip on how affiliate marketers can make their first steps towards global expansion, PerformanceIN sought the advice of experts from two internationally operating affiliate agencies, both of whom have valuable experience in affiliate expansion.
The building blocks
It’s unlikely marketers are weighing up programme expansion overseas unless they’re seeing some level of success within their home market. But complacency is an error; fruitful results at home are not to be interpreted as a quick-win elsewhere, and it’s remarkably easy to neglect the finer characteristics that could ensure whether a programme takes off or tanks.
“[Expansion] is a difficult decision to make, and advertisers need to be aware that there can be risks involved if it’s done too quickly, without proper preparation,” says Jane Woodhead, director of key accounts at R.O.EYE, a performance marketing agency which boasts presence in the UK, Germany and New Zealand.
When it comes to initial groundwork, perhaps what tops the list of considerations is whether there is an initial demand for the product. If there’s no apparent opportunity from the get-go, it’s unlikely to be a worthy endeavour.
On top of that, if the product lacks local brand recognition, marketers should be prepared for a slow start, and it may be a push to get certain publishers signed up. However, an affiliate marketing programme can help in the long term, so long as it gains support from a larger strategy and is used alongside other digital channels.
If a demand has been identified and marketers are ready to put the time in, next considerations range from the cultural and logistical to the legal, as each individual country will be mired in its own set of intricacies.
Companies that fail to address cultural differences in detail beforehand will inevitably face stumbling blocks in consumer adoption, but they will also have a hard time winning over local publishers. One way this can be overcome is by ensuring a member of the team is familiar with local customs and best practice.
Additionally, there is often a gulf divide in laws and regulations between markets; Woodhead argues that global expansion is never a ‘one-size-fits-all’ strategy, citing a case in point.
“The UK, for example, is heavily regulated in comparison to other markets. The IAB wrote and published the Voucher Code of Conduct in 2013 as a way of developing the success of the voucher code space, which ultimately led to increased confidence from the customer and the advertiser.”
On the other hand, European marketers moving into the US may be struck by the country’s state-specific tax laws, and a vastly different regulatory environment.
Without the right levels of resource and experience, managing an overseas affiliate programme in-house can be, unsurprisingly, fraught with pitfalls. One of the more common of these is when marketers don’t spend time choosing partnerships wisely, says Robert Glazer, CEO of US-based affiliate agency Acceleration Partners.
“It’s essential to understand no single network or platform is a global leader in every market. Salespeople often tell you what you want to hear and many companies have turned over management of their global affiliate presence either to a single network or agency, only to later realise their considerable limitations outside of the primary market.”
The same goes for agencies; no single agency has a market-leading affiliate practice in more than one region, and while many can boast a global footprint, programmes are regularly staffed by specialists in other channels, resulting in implementation that lacks quality and proactivity.
Glazer also points out that the technologies a programme uses will carry advantages or disadvantages within certain markets, citing the US and Europe again as examples.
“European networks typically include programme management services along with their technology platform services with the objective of helping the merchant grow their programme and increase the overall fee level.”
Large European agencies will also tend to have well-developed and established affiliate management practices, adds Glazer, while full-service networks in the US and Canada will often charge additional fees for programme management services. Large marketing agencies in the US may not even have an affiliate practice.
The final piece of the partnership puzzle concerns the people that help the channel tick: the publishers. Once an advertiser has identified what their options are and have built out a profile for each affiliate. Glazer recommends sorting them into one of three tiered categories.
“It is wise to start with top-tier publishers as this is where the likely volume is, moving down through to the mid-tier and long tail.”
However, Glazer urges that just because a publisher is prolific in one market, it does not necessarily mean that they’ll be as ‘big’ elsewhere.
“Speak with your publishers if you are not sure whether they are active in foreign markets as you may also find out that they also have expansion in their pipeline," Glazer adds.
If that list becomes exhausted, it may be time for some hard publisher recruitment, with tools such as comScore or SimilarWeb coming in use for unfamiliar markets, while getting on the ground at industry events in a specific area could be the most effective, up-front approach.
Once an advertiser has found those partners, it’s a case of optimising them through testing and learning, while keeping their relationships watertight.