According to the Kinsta, affiliate marketing is the most successful channel for 20% of brand marketers in 2023. Why was this often neglected channel exploited more by advertisers during the health crisis to the detriment of other levers such as Display for example? We give you some answers in this article.
AFFILIATE MARKETING, AN EXCHANGE OF GOOD PROCESSES BETWEEN AN AFFILIATE AND AN ADVERTISER
First of all, what is affiliation? This marketing technique consists of redirecting a visitor from a website or a page of a social network of an affiliate with an audience, to an advertiser wishing to promote his offer. According to the agreement between the affiliate and the advertiser, the latter then pays the other a commission when the visitor is qualified or becomes a customer of his brand.
In digital, the affiliation can take different forms:
- Affinity sites that redirect the visitor via Display or a CTA
- cashback websites
- Coupon Code Compilers
- White marks
- Bloggers and influencers
Why Affiliation ?
The common point between these different affiliates is that they are able to develop an engaged community and generate qualified traffic likely to interest advertisers who wish to acquire new leads or customers. This channel is very hybrid because it can, depending on its use, be relevant for developing the notoriety of a brand thanks to this “network of ambassadors”, but it can also be a ROI lever, thanks to this logic of performance-based commission. And it is this last point that has allowed this channel to progress faster than other digital marketing levers in recent times.
Indeed, during the COVID health crisis, it would seem that some advertisers were more cautious and reduced their budget on several of their historical channels to favor this lever over performance.
For example, Smartbox, a specialist in gift boxes, “ended 2020 by increasing the budget for its affiliate campaigns, while the pandemic had made things difficult. During this unstable period, the control over profitability and the choice as to the distribution of its investments force the ROI approach”.
This trend seems to be confirmed, according to the 2021 membership barometer, in all sectors. The maturity of the affiliation is however different according to the sectors, which explains in particular the differences in conversion rate or average commission.
MEASURING AFFILIATE MARKETING PERFORMANCE WITHIN THE MEDIA MIX
To ensure the traceability of an exchange between an affiliate and an advertiser, each link has a tracking code that identifies the source of each visitor, from the origin of the affiliate link to the site where it points. Cookie tracking can also be used to track visitor behavior over several days. Without this, it is not possible to measure the effectiveness of this channel.
Be careful, with the multiplication of points of contact between visitors and brands, it is possible that a visitor will be affected by different channels before making a purchase and becoming an effective customer of the brand. In this case, affiliation only partly explains the conversion. This is why we recommend analyzing the role of this channel by considering all of the visitor paths within the media mix implemented by an advertiser.
To do this, it becomes relevant for brands to use marketing attribution (a technique that consists of determining the actual contribution of each marketing channel to a conversion) to obtain an aggregated view of their media mix. When practicing a last click attribution, the advertiser finds himself with a partial view of the ROI of his affiliation channel because the latter does not take into account the influence of other channels, which may lead him not to distribute effectively its budget. An algorithmic approach is most often more relevant because it provides the most realistic view of consumer behavior.
By obtaining the vision closest to the reality of consumers, it will then be possible to deduce whether the affiliation has respected the objectives defined by the advertiser and the strategy put in place: to have a role of initiator by being in top funnel or a finisher role that completes conversions.
Secondly, it may be wise to carry out an analysis by affiliate having brought traffic or conversions to allow the advertiser to make operational decisions concerning their affiliate campaigns. The metrics to use will necessarily be the CVR (Conversation Rate), CPV (Cost per Visit) and ROAS/ROI (Return On Ads Spends). These indicators help to decide whether to stop or favor a partnership with an affiliate, they also make it possible to adjust the commissions paid if the algorithmic attribution identifies an overestimation of the number of conversions.
If, like other advertisers, you want to strengthen this lever, think about tracking, measuring, analyzing and adjusting your partnerships, with the attribution system that will give you the necessary visibility.