Elevate Your 2023 Marketing Strategy and ROI with Affiliate Partnerships
Given the state of the current global economy, marketers are being extra cognizant of which channels are most efficient and driving the best results. As costs of other marketing channels are on the rise, leaning into affiliate marketing’s pay-per-performance model is the cost-effective solution to keep you aligned with your goals. Learn why affiliate marketing is a powerful and critical investment to catch lost conversions from other paid marketing channels and boost ROI in 2023.
Why you should be boosting ROI through affiliate partnerships
Affiliate marketing continues to be one of the most profitable marketing channels. In addition to working with thousands of partner types to reach a specific audience, the CPA model (Cost Per Action) allows you to truly hit a guaranteed ROI.
More customers are evolving their consumer journey from their first interaction to their last. With affiliate marketing, you can customize your KPI’s and set specific goals by partner type to ensure you are engaging with both new and existing customers throughout the entire funnel. Affiliate marketing also complements other digital marketing channels as a traffic driver or even a converter. Affiliate marketing is a low-risk but high-reward option to hit your goals in 2023.
How the performance model can align with your efficiency goals
Within affiliate marketing, costs usually only go up when your product/service price increases, allowing you to balance healthy margins. Because of this, affiliate marketing is not seeing the same cost increases as other digital marketing channels at this time.
Furthermore, the benefit of affiliate marketing is only having to pay when an agreed-upon action occurs. Even with traffic increasing, affiliate partners will earn their commission after the transaction occurs and the returns window is closed. Yes, that is right! With affiliate marketing, you get your money back if a return is made.
At Acceleration Partners, we processed $24M in returns for our clients to re-invest back into the channel. What other marketing channel or program gives you this option?
How consumer behavior has shifted as a result of the affiliate channel
With 39% of consumers switching brands after being approached by a competitor, brand loyalty is declining. For competitors to gain market share more easily, it is critical to work with a partner that can not only reach the right audience, but also effectively engage the audience.
Engagement is critical as consumers are spending more time researching before converting. In the US, 51% of consumers said they definitely plan to use online coupon sites, apps or browser extensions to save money. With loyalty programs continuing to rise in popularity, 79% of US consumers said discounts were the most sought-after loyalty program benefit, with an increase of 9 percentage points from the previous year.
Two partner types – loyalty and coupon – are currently top of mind for the cost conscious consumer. If you are trying to reduce costs by removing loyalty and coupon partners, you are missing a significant portion of the global population, especially as appetite for loyalty and coupon is expected to grow even more in 2023.
The 5 best affiliate marketing strategies for a successful and profitable year
1. Leverage specific partners to keep customers from lapsing. Instead of only measuring revenue, look at the type of customer each partner type is driving for your brand. By assuming a loyalty partner isn’t incremental and will only benefit existing customers, you are missing how consumers are engaging with loyalty partners and the benefits you will get, as the consumer will typically buy more often with you and will also spend more and drive a higher AOV than other channels.
2. Strategically acquire new customers. In addition to competitive conquesting, consider other methods to drive new traffic. Promote key benefits such as either downloading an app to keep consumers engaged, or applying for a store credit card. With affiliate marketing, you have an open canvas to pivot and optimize goals accordingly. If you decide by Q2 that you want to pulse your new customer acquisition efforts, if you are sharing the data with the partner, they can work with you to ensure they target the right audience to grow your new customers.
3. Embrace full-funnel strategy. Instead of siloing your marketing plans at the awareness and closing stages, embrace all parts of the funnel by using the right KPIs with the right partner. For example, you can leverage influencer for brand awareness while encouraging loyalty to close – it’s all about finding the right partner mix if you want to hit specific goals.
4. Test and learn in order to optimize. Shift your testing budgets to affiliate and check out new opportunities like connected TV or cart abandonment partners. Remove the red tape and see how quickly you can grow your program.
5. Adapt and evolve. With macroeconomic challenges, sometimes planning three months out does not work. However, with affiliate marketing, you can shift your focus to the consumer. The consumer wants to research more about a purchase, invest more in review sites and mass media partners. Partner transparency is key as to WHY you should want to shift focus.