Affiliate Marketing: The Good, The Bad and The Ugly

by | Jul 13, 2021 | Affiliate Marketing, Blog, Digital Marketing

Affiliate Marketing: Some people love it, some people hate it.

But why are there so many mixed feelings around a continuously evolving industry that generates around 16% of all ecommerce sales globally? 

In short, the various perceptions of affiliate marketing come from a handful of misunderstandings. First and foremost, many people are not familiar with the real potential of an affiliate program. Furthermore, people do not understand the time and management required to take an affiliate program from launch to profit.  

To reap the benefits of this ever growing marketing channel, your affiliate efforts must be an integral part of your greater digital marketing strategy. When managed correctly, the affiliate channel can drive incremental revenue and long-term, sustainable growth for your business. 

However, as with most digital marketing channels, there are some ugly parts of the industry that you should be aware of. Luckily, with the proper insights and a strategy rooted in best practices, these not so hot parts of affiliate can be effectively prevented.

Let’s start with The Good

Affiliate marketing is big business. In fact, the U.S. affiliate marketing spend is projected to reach $8.2 billion in 2022. That is triple the spend from just ten years prior. 

Over the last decade, the channel has also matured in a way that impacts more than conversions. Today, the channel is effectively increasing brand awareness, promoting new customer engagement and supporting existing customer journeys. 

Buy in From Content Publishers

The growth of content publishers have been the key to affiliate marketing’s modern-day mark. 

Historically, content publishers have been reluctant to work in the affiliate channel because of its last-click attribution model and the work required to generate links. However, with the advancement of attribution models, content publishers can now be fairly rewarded for their contribution toward the path to purchase. Additionally, networks such as Skimlinks make it easier than ever for content publishers to find brands to partner with and to include tracking links in their stories. 

Major publishing houses such as Meredith, CondeNast and Hearst also see the affiliate channel as a valuable way to make up for lost revenue from print media. 

According to Pepperjam, content is the fastest growing partner type on their network, with 65% YoY gains in 2020. Rakuten Advertising has also reported significant growth in traffic to content and subnetworks, with 74% YoY growth in November 2020. And according to Awin, content sites earned almost 40% of all affiliate commissions in their U.S. network in 2020. (Source: https://supermetrics.com/blog/affiliate-marketing-statistics)

The Other Piece of the Publisher Puzzle

Let’s not forget the value of the more traditional types of publishers. 

Data shows that coupon and loyalty sites do more than just close the sale. According to one survey:

  • Nearly a third of consumers access coupons and loyalty sites on a weekly basis.
  • Two-thirds of consumers will consider a new brand if they receive a discount, and nearly half will consider a new brand if they receive a reward.
  • An incrementality study conducted by Commission Junction showed that shoppers who interacted with affiliates had a 46% higher conversion rate and a 29% higher AOV than those who didn’t.

The value of the discount also surged during the COVID-19 pandemic. The pandemic directly impacted the way many shopped, leading consumers everywhere to seek out deals and offers. According to a May 2020 survey by Statista, 60% of online shoppers stated that “getting a discount when making online purchases was even more important since COVID-19.” 

The Bad

Affiliate programs can be misrepresented as driving only bottom of the funnel traffic, in turn, stealing attribution from other channels. 

The fact is, if not run properly, this can be true. There are affiliates out there who solely help to close the deal, and/or solely use toolbar technology to get credit for the sale. A poorly managed affiliate program will be saturated with these types of publishers, damaging your overall ROI and disrupting the accuracy of your analytics.

The Ugly:

Unfortunately, there are bad seeds in the affiliate world who have tampered the reputation of the channel. Amongst these “bad seeds” are deal sites who refuse to take down unauthorized coupon codes, affiliates who bid on trademark terms without permission, and fraudsters who try to take advantage of cashback sites. The potential for channel conflict is always there, but the ugly is only exacerbated by the mismanagement of an affiliate program. Luckily, the same attribution tools that help content publishers receive the credit they’ve earned can be used to make sure affiliates aren’t getting credit for things like promoting coupons not provided to them.

Now back to The Good.

There are many tactics available to monitor and police the bad and the ugly of all things affiliate. In its leanest form, brand guideline adherence and safety must be an integral part of any affiliate program, from the very start of partnerships (terms and conditions) to the daily program management tasks. 

On a more granular level, the good of affiliate marketing is brought to light through the use of third-party compliance tools, advanced knowledge of analytics, cross channel marketing strategies and the cultivation of strong relationships with publishers. For stand-alone businesses who have kept affiliate marketing on the back burner, it is important to understand the power of a comprehensive affiliate partner with proven success. 

This is what we do; affiliate marketing is eAccountable’s bread and butter. With over 20 years experience in the channel, we support all types of businesses in their affiliate efforts. Here a few things we are data-proclaimed experts at: 

Compliance

To ensure affiliates are following the rules of your program, ongoing compliance monitoring is necessary. There are many ways to do this, including:

  • Using network coupon code suppression tools to commission only on valid codes
  • Ongoing monitoring of publisher sites, search results and redemptions
  • Search engine monitoring for trademark terms
  • Using third party tools like BrandVerity to monitor trademark bidding and the coupons affiliates are promoting

Recruitment

Reputation is everything in the affiliate world. 

eAccountable’s profound affiliate marketing experience has contributed to unique publisher insights. We can identify the publishers that will best serve your program, and we are familiar with those that you should avoid. 

Attribution

An entire team certified in Google Analytics? Absolutely. 

eAccountable understands everything there is to know about cross-channel reporting and attribution. We leverage a number of network attribution tools to make sure affiliates are being compensated in alignment with KPIs, in addition to ensuring multi-touch and cross-channel sales are properly accredited to incentivize behavior across the full funnel.

As for any profitable marketing channel, success takes work. However, improved sales, new customer generation, strong ROI, increased conversion, AOV and brand awareness make an affiliate program well worth it. 

To learn more about how eAccountable can support your affiliate channel, you can email affiliate@eaccountable.com and one of our affiliate marketing experts will be in touch.

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