Affiliate marketing has evolved by leaps and bounds since the late ’90s when brands first started paying websites commissions for driving new customers. With the explosion in the number of merchants and affiliates, the proliferation of digital marketing channels (search, social, mobile, display, email), and the increasing number of touchpoints on the consumer path to purchase, affiliate marketing has become more complex, requiring new levels of service and technologies for companies to scale.
Here we highlight five of the hottest trends at Affiliate Summit West that generated the biggest buzz:
1. De-coupling services from technology
In the early days of the market, the affiliate networks brought together advertisers and publishers, providing unprecedented efficiencies by aggregating offers, tracking, and commission payments.
But, as marketers start to integrate affiliate marketing into their overall marketing strategy, they want to better understand how the affiliate channel overlapped with other marketing channels, how to align their attribution model to drive desired behavior, and how to reward affiliates who provide the most value. More sophisticated services and technology, such as Software as a Service (SaaS) are giving brands more control and ability to drive greater value.
2. Realigning the brand and coupon affiliate relationship
In the past few years, coupons have seen a massive resurgence, especially online. Thanks to online coupon sites, consumers have greater access to discounts than ever before and they have come to expect them.
Online retailers responded to this trend by adding a coupon/promotional box to their checkout pages to drive more sales. Yet as online tracking and attribution models have become more sophisticated, brands are reexamining their relationships with coupon sites to ensure they are supporting their overarching business goals.
They are being more selective with partners and placements to ensure coupon sites are supporting their ROAS goals and that they aren’t spreading their marketing efforts too thin.
3. More sophisticated tracking, tools, and measurement
As the number of digital marketing channels has expanded, fragmented tracking has made multichannel marketing chaotic and difficult to measure, negatively impacting advertisers’ return on ad spend. Brands are increasingly looking at affiliate marketing in the context of their greater marketing efforts.
Technology solutions – from Cake, Impact Radius, and Performance Horizon Group – have empowered marketers to more effectively optimize the affiliate channel with streamlined tracking across channels and deeper insights into which partners are performing. This allows them to alter payouts to affiliates based on individual order attributes, rather than paying the same amount for every transaction.
4. Greater transparency for advertisers
Affiliate marketers have moved beyond measuring success based on the number of affiliates and overall program revenue. They know how to properly measure the success of their program by looking closely at new customer acquisition and using multichannel attribution models to understand which part of the conversion path is converting the most shoppers into buyers.
Knowing which affiliates are driving sales is crucial to affiliate marketing success. Dynamic attribution technologies help merchants identify the partners that are the most responsible for a transaction and reward them accordingly.
5. New opportunities with nontraditional affiliates
Affiliate marketers are constantly looking for new ways to expand the scope of their programs. One new approach is for merchants to partner with nontraditional affiliates such as a school or nonprofit through the creation of a co-branded storefront.
When the organization’s supporters make a purchase from the site, the merchant donates a portion of the sale to the partner. This is a win-win, driving more sales for the merchant and raising money for schools or other organizations.
TinyPrints partnered with schools to allow school supporters to purchase personalized holiday cards. For every purchase made, TinyPrints donated 13% of the sale to the school.
Affiliate Summit West’s sessions spanned the spectrum of affiliate marketing, fostering conversation around an assortment of topics. These five threads were woven through the show, reflecting their status as game changers and identifying them as areas where marketers should focus to get ahead in an industry constantly in flux.
To learn more about Acceleration Partners and our approach to affiliate marketing program management for leading brands around the world, visit our Global Services page.