The shift away from the term “affiliate” has been a long time coming within the performance marketing space, given its perceived negative connotation in the industry. This negativity is primarily derived from the assumption that the affiliate channel is saturated with lower-funnel traffic that lacks transparency and is on the way out; however, affiliate marketing is far from dead. Perform[cb] Agency is experiencing this shift firsthand and has a pulse on where the industry is heading next.

What is performance marketing?

Performance marketing can be defined in many ways, but for our purposes, we’re defining it as an umbrella term to encompass any kind of marketing that is performance-based. Since almost all modern marketing is tracked and metered, it could make sense to say all digital marketing is performance-based. The common thread connecting each performance marketing channel listed here and beyond is payment; performance channels are exponentially adopting the cost-per-acquisition or cost-per-sale model with last-click attribution.

This means that all of the channels we’re talking about are only paid out when the final desired conversion is made. Further, it’s important to break down the tiers of performance marketing to gain a better understanding of how traditional affiliates and modern content partnerships harmonize and balance one another.

Traditional affiliate marketing

Under the umbrella of performance marketing, affiliate marketing now often refers to traditional lower-funnel partners such as deal and loyalty sites, as well as affiliate networks. These partners are crucial to the success of a brand’s performance marketing efforts due to the incrementality they drive through increasing metrics such as average order value (AOV) and conversion rate. Learn more about why these lower-funnel partners are vital to driving incrementality here. 

Lower-funnel partners are only a piece of a healthy performance marketing mix. According to a 2019 study by Hubspot, 47% of consumers viewed three to five pieces of content prior to engaging with a sales rep. The marketing rule of seven touchpoints to conversion is still alive and well, which means a balance of lower, mid, and upper-funnel content is key to maintaining and scaling performance marketing efforts as a whole.

Partnership marketing

The term “partnership marketing” is starting to be widely accepted in the space, due to the increasing number of content sites offering to write about brands on a cost-per-sale model, versus flat fee. Content partnerships are thriving within the performance marketing world for several reasons, with one of the biggest reasons being these partnerships allow brands to work directly with editorial teams. Editorial teams used to have to fill remnant space for free, however, now they can add an affiliate link and monetize that content. Content partners come in a range of sizes from mommy bloggers and YouTubers, to household publications such as Forbes, Conde Nast, and Buzzfeed.

Many marketers may look to an agency to manage these partnerships, given the established relationships that agencies typically have with such partners. Regardless of the partner’s size, such one to one relationships are proving to be the answer, as marketers continue to press their partners for transparency while still running on a cost-per-acquisition basis. 

According to the same 2019 study by Hubspot, marketers who prioritized blogging efforts were 13 times more likely to see positive ROI. As one of the largest growing verticals in the performance realm, partnership marketing will continue to be top of mind for brands looking to increase brand awareness in the upper portion of the buyer’s funnel. For brands looking to get involved with content partnerships, it’s important to understand the type of exposure and goals your brand is looking to achieve prior to investing. Not sure if content partnerships, bloggers, and influencers are right for your brand? Don’t worry, you can learn more about how to successfully integrate content partners into your marketing mix here.

2020 will bring many changes to the industry, as every new year does. However, the reign of performance marketing and its numerous verticals will continue to be a front runner in the global marketing mix. Marketers who pursue performance partnerships will thrive so long as their strategies include a healthy balance between traditional lower-funnel affiliates and upper-funnel content partners. 

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