In recent years we have seen the conventional affiliate network industry disrupted by the emergence of the Saas platforms, which is creating an interesting battle across Europe, the US and Australia as these technology titans fight each other for dominance in the market.
No longer are the affiliate networks just competing with one another, they now need to compete as a collective against these new technology platforms to convince advertisers they are still the most relevant solution in the market.
So, who is going to win?
Every week, advertisers ask me the same question: “Am I on the right platform?”
In fact, the question becomes so common that we at Silverbean developed a partner progression model to share with advertisers so it made it easier for them to work out whether staying with an affiliate network was right for them, or whether they were ready to take advantage of the benefits SaaS platforms can provide.
Whether you’re considering working with advertisers on all of the major affiliate networks, or working with advertisers whose partner programmes sit on SaaS platforms, let’s simplify the argument for both sides so you can make up your mind about which one is right for you.
Cost-effective convenience vs data-driven decision making
Affiliate networks have been instrumental in the growth of the affiliate marketing channel. They make it easy for advertisers to launch affiliate programmes and grow, making them a marketer’s dream. They charge relatively little to ‘go live’ and most of their income is derived from the advertiser’s success in generating sales, giving them an incentive to provide great functionality.
On the other hand, SaaS platforms provide advertisers with distinct opportunities to be far more data-driven in their decisions. This enables advertisers to create more intelligent commissions and rewards for individual partners that can drive up sales and reduce CPA’s.
Partner recruitment vs partner optimisation
One of the most attractive features of the affiliate networks is their reach to affiliate partners. This makes it very easy for advertisers to promote their programme to significant volumes of potential affiliate partners. For example, Awin has over 200,000 publishers on its platform, meaning early traction and early sales for advertisers.
The SaaS platforms operate in a different way. Advertisers will need to invest more of their own time trying to recruitment the right affiliate partners because the SaaS platforms have less volume reach. This is why the SaaS platforms are normally better suited to advertisers who are more focused on optimising the performance of existing affiliate partners, rather than just recruiting more of them. This is a challenge recognised recently by Impact, whose recent acquisition of Media Rails is a strategic move to offset this clear benefit the affiliate networks provide advertisers.
Traditional tracking integration vs personalised tracking
Affiliate networks utilise the same conversion tag for all clients with the ability to add in additional parameters for reporting purposes. The core tracking of order ID, sale amount and commission group all remain the same however with little flex in the ability to adapt tracking for clients’ needs. The majority of the time commissioning is done based on a parameter being isolated, which a developer parses a variable within. This can be based on the Sku, for example, or a commission group name.
On the other hand, a SaaS platform creates unlimited parameters for a client to parse information into the dashboard. The account manager can then decide to use the information for reporting purposes (for the affiliate or just the business) or look to commission on it on a pivot basis. The SaaS network can then fundamentally adapt to the client’s needs and requirements much more easily.
The benefit therefore of the SaaS tracking solution is the ability to parse unlimited variables into the network and then for the account manager to do as they wish with them. This is in contrast to the networks, where any changes need tech resources to amend.
Network affiliate marketing vs partnership marketing
The affiliate networks are primarily focused on providing advertisers with the means to build and manage their affiliate programme.
The SaaS platforms, meanwhile, are at the forefront of the changing perceptions of this channel, which is moving from affiliate marketing to partnership marketing.
The SaaS platforms enable advertisers to ring-fence their partnerships, which means they are able to manage their wider portfolio of media, influencers and strategic brand partners without giving access to them to other advertisers.
Network familiarity vs innovation
Affiliate networks have a technology challenge. With so many advertisers hosted across the networks rolling out new technical features or processes, automation is a significant challenge. This means that whilst their technology is fit for purpose when it comes to managing affiliate partnerships, they can lack somewhat in the innovation areas.
The SaaS platforms however are building their businesses on providing advertisers with the technical features they demand and need, which means greater innovation and advanced features.
Getting on the right platform
Now we’ve had a summary of the main benefits of the affiliate networks and their rivals, the SaaS platforms, let’s address the question we started with; how do you know if you’re on the right platform?
Your answer can be found by considering these questions first:
- How important is the affiliate partner channel to your business?
- How ambitious are you about your affiliate partner marketing objectives?
- How mature is your current affiliate partner programme?
- Are you wanting to build a partner marketing programme, or just focus on affiliate partners?
- Critically, what resources can you assign to your affiliate partner programme?
It’s clear that both the affiliate networks and the Saas platforms have a huge role to play in the future of affiliate and partnership marketing. While the affiliate networks have made this highly effective marketing channel accessible to every potential advertiser in the market, the Saas platforms are providing the next generation of technological advancement for brands to build world-class partnerships.
The battle has commenced.