How to Win At Affiliate Marketing

This article is brought to us by Hawke Media: Your outsourced CMO

Affiliate marketing is certainly not what it used to be. And that’s a good thing. In the early days, affiliate marketing may have seemed a little scammy and unscrupulous. But those days are long gone. If you’re not already on the affiliate marketing bandwagon, now may be the time to jump aboard. 

Affiliate Marketing Is Popular and Cost Effective

Although there are certainly other marketing routes you can take, the popularity of affiliate marketing is a testament to its growing success. It’s a cost-effective form of marketing, allowing businesses to reach new audiences, grow brand recognition, and boost the bottom line and often to only pay for performance. It’s a great way for publishers to monetize their online presence, attracting high quality affiliates in every online sector.

It is estimated that U.S. affiliate marketing spending could reach $8 billion in 2022. When it comes to increasing sales, this strategy is a win-win all around. But prior to putting your affiliate program in place, you’ll need to understand the basics. While it’s relatively easy once you get started, the more you know, the more quickly you’ll reap the rewards. 

What Is Affiliate Marketing

Affiliate marketing is where brands pay commissions to others to promote their products and services online. These promoters, known as affiliates, advertise online and drive interested customers to your website to get more information, request a demonstration or make purchases. Affiliate marketing is growing in popularity as brands realize that traditional methods of advertising simply don’t work the way they used to. 

Affiliate marketing has evolved over the years. In its early days, website owners and blog publishers signed up for affiliate programs to extend their own monetization efforts. The savviest looked for high-ticket and high-payout items that earned commissions in the hundreds, if not thousands, of dollars. They promoted anyone and everyone that paid, regardless of whether brands were competing. This still occurs, but the industry has changed and matured in significant and positive ways. 

One of the most significant is the popularity of influencers. What’s the big deal about influencers? In a word: trust. Influencers have a community of followers who believe in them and the products they recommend. In fact, 92 percent of consumers surveyed trust influencers more than they trust celebrity endorsements or conventional advertising. The best influencers will champion your brand and are the best type of affiliates. 

The net effect on affiliate marketing today is largely positive. As customers increasingly respond to the authenticity that influencers offer, affiliate marketing must up its game. Just any old messenger or influencer won’t do. Brands that build authenticity into their affiliate programs realize that anything less will dilute the value of the brand. Nowadays, the affiliates that make money are those that put in the work and do what is needed to establish credibility, both for themselves and for the brands they represent. 

Benefits of Affiliate Marketing

There are many ways that your company can benefit from a well-conceived affiliate marketing effort. They include:

• Low barriers to entry: Even if you don’t have a full-blown marketing team, you can easily set up an affiliate marketing program. It requires little more than choosing the right affiliates. 
• FTC regulated: As much as you may not like having too many rules, those established by the FTC for affiliate marketing diminish fraudulent activity, create standards and protect the integrity of your program. It’s one less thing to worry about.
• Extended and targeted reach: Your affiliates have an authentic connection with your specific audience. These types of targeted efforts would be expensive using conventional advertising.
• Low maintenance: With a crew of brand ambassadors, there is little to do to maintain an affiliate program.   
• Greater profits: Through a combination of the aforementioned access to the audience you want and the authority of your affiliates, you’ll see a greater return on your marketing spend.

Best Practices to Get Started

1. Take a look at your fiercest competitor. 

The trail isn’t a new one. Determine where they have affiliate relationships and what types of program they are running, the program terms and the messaging in their creative. Investigate their website and follow them on social media.

2. Determine how your affiliates will be paid. 

Based on the information you’ve gathered, you will want to pay at or slightly above industry standard. There are other considerations as well, including the payment structure. Are your competitors paying for leads or sales? Is commission generated for traffic? Are they using a pay-per-click or pay-per-call campaign? 

Consider the type of business you have and what you want to accomplish. If you’re an insurance business, for example, your goal is likely to get the potential customer to contact your office, but an eCommerce seller is looking for a website visit or completed sale. It’s important to align your goals with the right incentives for your affiliates.

3. Define the types of affiliates to target. 

Of course, you can build it and wait for the brand ambassadors to flock to you. But when you determine in advance the type of affiliates you want, you’ll have a better idea of how to create your program and tailor it to attract your target affiliates. Consider the types of channels that work best for your products and services. You may have a product that’s perfect for livestream selling or one that is best for health and fitness bloggers. 

4. Select the right affiliate marketing platform. 

There are many ways to automate your affiliate program so that it is efficient and requires little additional effort to run. Some of the most popular software for affiliate outreach and management includes: Refersion, Impact, Taboola, Post Affiliate Pro, and Tapfiliate among others. These platforms will handle onboarding, reporting, tracking, referrals, and payments. In addition to price, you’ll want an intuitive interface, robust customer service, scalability and SaaS integration with whatever eCommerce platform you’re using.  

5. Develop your key performance indicators (KPIs). 

Your program has the best chance to succeed when you manage by the numbers. These typically include sales, conversion rates, lead generation, average customer value, lifetime customer value and cost per acquisition. There may be others, such as the number of new affiliates and year-over-year growth, that can help you determine how and when to tweak your program. 

6. Affiliate Marketing: Part of a Holistic Strategy

Remember that affiliate marketing is just one piece of your overall marketing strategy. Ensure that you have an integrated approach. Whatever you’re doing on Twitter, Facebook, or your own blog should combine to tell a coherent brand story and entice customers to buy. That’s what a holistic strategy is all about. 

Admittedly, it can be difficult to keep track of all the moving parts. In the digital world, there is a lot to know. That’s why it’s important to have the right partner. If you don’t have the resources internally — and not many companies do — you should bring in experts, like Hawke Media. They have the digital know-how and can help you get it right from the start. 

Affiliate marketing doesn’t need to be difficult but you’ll need to have a deliberate plan to optimize your efforts. It can be an important way to extend your reach, increase your sales, and position your brand for future prosperity.

Sources

Statista - Affiliate marketing spending in the United States from 2010 to 2022

Forbes - Influencers Are the New Brands

Forbes - The Good, The Bad And The Value Of Affiliate Marketing