March 21st 2019
Performance Partnerships 101: Technology

Technology plays an essential role in the Performance Partnerships® framework.

You and your partners could have a mutually beneficial, transparent partnership that's based on trust and respect and be completely aligned with a cost per action compensation structure.

However, if the technology isn't in place, managing, scaling, tracking and measuring the performance of these partnerships in an efficient way is virtually impossible. At the very least, it would be mind-numbingly manual, time-consuming and unproductive.

Fortunately, there are technology platform options available to those who want to make performance partnerships part of their marketing and business development endeavors.

Both options below act as an intermediary between brands and their performance partners. Each are also set up to handle the tracking and reporting of partner activities and automatically pay out commissions to them based on the rules set by the brand.

While similarities exist between these options, there are some notable differences that are important for brands to evaluate based on the needs and goals of their affiliate program.

Affiliate Networks

Many networks also host the creative for the brand's affiliate program (banners, links, etc.) as well as promote the brand's affiliate program to a large pool of affiliates who are members of that network. For their services, affiliate networks primarily charge their clients a performance fee, which is typically a percentage of program revenue (e.g. 1-2%) or commissions paid to affiliates (e.g. 30%).Affiliate networks range from offering full program management services to offering only technology solutions while also managing affiliates within their network.

Software as a Service (SaaS) Platforms

SaaS platforms are not "networks" in the traditional sense as they do not provide traditional affiliate program management services. Their focus is on offering high-value technology for an affiliate program to run on and offering white-labeled affiliate network technology to manage "direct" affiliate relationships for brands.

If a company does not have the resources or expertise to manage their performance-based partner program in-house and chooses a program management agency (e.g. Acceleration Partners) to handle the day-to-day management of it, the SaaS provider will work closely with that agency to ensure all affiliate performance is being properly tracked, measured and compensated.

SaaS providers tend to offer a variety of fee models, including fixed, volume/transaction-based and performance fees. Several SaaS providers also offer fixed-fee or usage-based pricing models that are not tied directly to revenue or to commissions.

Technology of Tomorrow

Companies are now asking very different questions related to their performance-based affiliate and partner programs than they did ten years ago. They want to know about strategy, innovation, incrementality, attribution and global account management, whereas previously they were more interested in tracking and payment details.Industry-leading companies increasingly want control over their brands and their partners in the same way they would if they were setting up brand licensing programs. They also want:

  • To understand exactly what technology and services they are paying for.
  • Clear accountability and separate service-level agreements for each segment of their contracts.
  • The ability to combine the data from their affiliate programs and their partners with other areas of their marketing-technology stack.

While technology exists that delivers on these needs and wants, it's growing in sophistication and efficiency.

Thanks in large part to these advancements in technology, the industry is rapidly evolving. The future of performance-based partner marketing will be increasingly customizable and personalized. Brands will find it possible to design their programs to reward very specific behaviors that match their desired business strategy and establish entirely new types of partnerships that companies in any industry or business vertical can benefit from.

To learn more about affiliate networks and SaaS platforms, check out our guide to Affiliate Networks And SaaS Platforms.

Other posts in this series:

Performance Partnerships 101: Cost Per Action

Performance Partnerships 101: Transparency

Performance Partnerships 101: Real Relationships

Interested in learning about more about incorporating affiliate technology in your affiliate marketing program? Contact our team today.

Author: Lenox Powell