The Value of Diversifying the Types of Partners in Your Affiliate Program
To find out more about the benefits of diversifying your affiliate program, tune into our fireside chat webinar series here.
Read on to find out about the changing tide of affiliate programs and how you can stay ahead of the game with a winning partner development strategy.
How the tide is changing
Within the affiliate industry, the primary form of affiliate attribution has been Last-Click, meaning the last affiliate in the clickstream receives 100% of the commission. This model has tended to favour incentive based partners such as loyalty and coupon and has meant these affiliates are the top contributors on most mature affiliate programs.
Although this affiliate attribution model has been the preferred setup, new technology and platforms are opening up opportunities to a variety of attribution options that recognise affiliates across the purchasing funnel. Up and coming models include:
- First Click: The first affiliate touched in the sales funnel gets 100% of the attribution.
- Coupon Code Attribution: An exclusive coupon code is tied to a specific affiliate. The unique code will attribute 100% of sales to the affiliate based on that coupon code.
- Preferred Publisher: Designate a single affiliate/publisher as preferred within a specific period. If a publisher is designated as “Preferred Publisher”, they will receive 100% of commission for any transaction.
- Linear: Each touchpoint in the conversion path – multiple affiliates or various sources shares equal credit for the sale.
- Time Decay: The touchpoints closest in time to the sale or conversion get the credit.
- Custom Attribution: Unique attribution setup that could be any combination of the other models or something new.
- Position Based Attribution Model: 40% credit is assigned to each the first and last interaction, and the remaining 20% credit is distributed evenly to the middle interactions.
Historically, distorted accreditation has meant affiliates with high-quality traffic were often undervalued by the “last click” measurement approach. Newer attribution models are allowing for much more sophisticated crediting. The result is a diversified affiliate base that brands can now really work with, establishing bespoke plans and campaigns as affiliates feel much more valued with fairer pay-out potential.
A shift in focus to looking at incremental sales has resulted in many brands reviewing their affiliate program partners. Brands want to understand how different models and partners can drive incremental revenue. If you’re interested in learning more about the diverse types of affiliate partners that are adding value to many brands’ affiliate programs, download a copy of our guide here.
Advancements in attribution and supporting technology have opened the door for a multitude of new partners to enter the space. These reduced barriers to entry for newer affiliate models are making it easier for brands to diversify their programs and reach new audiences.
We have seen a rise in podcasters and hosting platforms joining programs along with influencers now able to adjust to working on a performance model instead of fixed fee and traditional channels, like search and email supported via partners in the performance space. In the UK and Europe, there is increasing interest from brands to work with CSS partners on a performance basis, instead of CPC.
Benefits of having a diverse affiliate program
To alleviate risk, find new audiences and see program growth, brands are looking to diversify their partners outside of traditional affiliates and work with a broad range of innovative partners, including content, B2B, Podcasts and Referral program. Here are three key benefits.
1. Reach new audiences
Building relationships with multiple affiliates can help to grow your program by opening up a variety of different revenue streams, managed on a performance basis. Advertisers can benefit from greater brand reach working with a variety of affiliates, many of whom who are recognized as brands themselves. The key to success is being willing to test new partners while keeping existing performers valued and engaged.
There are many ways to get creative with A/B testing and messaging that leaves enough space for lots of contributors that create an even playing field and balanced program. If Acceleration Partners knows your goals, we can tailor a partner mix that will help you achieve them.
For example, one of our clients was looking to accelerate program growth through new partners, so our partner development team focused on a targeted recruitment campaign. Focusing on recruiting and optimizing these new partners resulted in a 170% MoM program growth and the affiliate channel is now one of their best performing digital channels.
2. Improved customer journey touchpoints
Utilizing affiliates to interact with customers at a variety of touchpoints gives more insights into the customer journey and its many touchpoints. With this data, you can work on strategic partner strategies that optimise touchpoints across the customer journey to increase revenue and brand awareness. Staying ahead of the game means expanding your base and working with a variety of partners.
3. Reduce risk
Diversifying your affiliate program helps to alleviate risks in your marketing strategy. By having a diverse range of program partners across the purchasing funnel brands can reach consumers at a variety of purchasing and consideration touchpoints and test a variety of strategies.
A diversified base can help control external factors like algorithm updates and changes from search engines that can impact partner visibility, e-privacy guidelines and best practices that partners must adhere too and even promotional method variables such as email deliverability for email partners. Industry changes and governing bodies can significantly alter performance overnight, so a balanced portfolio will help minimize risk.
For example, during a difficult trading period in Q2 2020, as a result of COVID-19, our client tasked us to create a strategic approach to push a last-minute promotional campaign on a global level.
Acceleration Partners sent personalized outreach to top partners in multiple markets to secure additional exposure while being mindful of the clients ROAS goals. As a result, the channel delivered exceptional YoY growth within the business.
The journey to a diverse affiliate program
It’s important to note that there is no ‘one size fit’s all’ approach when building your program diversification strategy, and it’s something that takes careful consideration, planning and organisation. By creating program goals, affiliate recruitment and activation can focus on achieving specific outcomes.
In response to demand from brands wanting to expand outside of traditional affiliate partnerships, our Partner Development team helps clients to define targets, strategy and optimization and ensure a common partnership goal is established between each client and their partners.
They focus on getting under the skin of the brand, understanding their target audience, products, unique selling propositions, speaking to various departments within the business. Their task is to find new, unique and creative ways to discover and onboard valuable new partnerships.
The team work closely with non-traditional partners to educate them on the value of the channel, how they can monetize via the affiliate channel and the ways they can work with our clients to complement their internal channels.
Our team is focused on recruiting a variety of new partners that can now work through the affiliate model. These have included social commerce platforms, performance display advertising solutions, niche content sites, brand to brand partnerships and direct marketing companies.