Digital marketing. Content marketing. Performance marketing. Affiliate marketing.
The industry is jam-packed with descriptors that can seem quite vague, especially if it’s not part of your day-to-day. On our blog we often talk about digital tactics such as influencer relations and social media content, but for one question always remains:
What else can we do to increase sales?
Recently, I sat down with our Director of Digital Advertising Anthony Berardo to get right down to business on one type of marketing that has helped dozens of our clients increase sales: affiliate marketing. Below is our approach to developing a strategy for brands and you can see where affiliate marketing lies under the “Owned/Paid” petal.
Without further ado, let’s dig in and discuss how affiliate marketing here’s how to can help your brand.
First let’s start with a question I’m sure you get from a lot of brands and that is, what exactly is affiliate marketing?
Of course! Affiliate marketing is a performance-based marketing channel where a business or brand rewards publishers and affiliates for sending traffic to their website, usually in the form of commissions based on sales.
At the heart of it, is the relationship between three parties: the merchant (advertisers), the affiliate (publisher), and the consumer.
A major benefit of this channel is that it overlaps with other forms of paid advertising and marketing channels, depending on how the affiliate monetizes their audience and sends traffic to the website. They often use various online advertising methods, whether it’s through pay-per-click, search engine marketing, social media, email, etc.
So what kinds of affiliate marketing are there?
Since the channel is a cost-per-acquisition model, what that acquisition is, or its end result, can vary and is determined before the campaign is launched. The most popular is cost-per-sale, where a commission is paid to the affiliate for any sale they refer.
However, there are many popular types, such as also cost-per-lead, pay-per-call (where the end result would be a consumer calling the merchant), cost-per-install (for apps on mobile devices), and cost-per-download (for software). Although affiliates do run simple pay-per-click or cost-per-impression ad campaigns, it is in the best interest of the merchant to run a program where the payout to the affiliate is based on a consumer action that is more involved than simply visiting the website.
As to the types of affiliates and publishers that effectively operate within a program, they vary as much as the different types of online advertising that can be performed.
There are pay-per-click affiliates who run display ads and SEM coverage to drive traffic to the merchant website. There are also email marketers, online shopping and marketplaces, cash-back and loyalty websites, discount, coupon and deal websites, as well on-site conversion optimization tools, like cart abandonment and visitor retargeting services, who offer use of their software on a performance basis.
A growing segment of affiliates are content marketers and social media influencers who use their profiles across their blog, Facebook, Twitter, Instagram, Pinterest, and YouTube accounts to monetize their content through their audience and reach.
How does a client decide if it’s a good fit for their brand?
If you have a business or service that would like to acquire customers online, then performance marketing through an affiliate program is a great channel to look into.
It encompasses all different forms of online marketing under one umbrella, without the large spend typical pay-per-click campaigns would require. And, it ties directly into performance, which means it’s grounded in ROI.
It’s a great channel for startups that don’t have large marketing budgets, but is also excellent for established brands as another channel that will provide an incremental lift in coverage, traffic ,and sales.
Are there specific types of products or services that work best?
Anyone that sells a product or service online would be a natural fit. Networks do tend to have restrictions on the type of content they would want, such as no adult websites, guns, illegal drugs, etc., and anything of an illegal nature.
[bctt tweet=”Anyone that sells a product or service online would be a natural fit for affiliate marketing.” username=”lotus823″]
OK so let’s say a brand is interested – how do you then select the right network?
When selecting a network, you want to do some research into the network. Try to find similar advertisers that align with your brand because that tends to mean that the network has like-minded affiliates. If you are a startup that needs to keep your budget in mind, selecting a network that has a low setup fee and low transaction fees may also be attractive.
After selecting a network, how long does it take for setup?
This depends on both the cooperation and efficiency of the advertiser and their web development team and the network. If both are working in concert, it can take as little as two weeks. If not and there are missteps along the way, we have seen it take as long as two months. Typically, we ask for a month of setup time.
Is there a timeframe for seeing return on investment?
Every brand and program is different. Brands that are more established will have a shorter turnaround time before seeing revenue lift and return on investment (ROI) as opposed to startups that need some heavy brand lifting. Typically by month three or four, all programs have enough data to determine the best foot forward and how effective the program will be for the current state of that brand.
That’s great, thanks so much for breaking this down for us! So tell us, what’s your favorite thing about what you do?
It can sound intimidating but the process can be quite simple once you get the hang of it! For my favorite part, it would be the fact that we can run advertising and marketing campaigns that tie directly into sales. This allows the client to have a high return on as spend. A successful campaign is a win-win-win for all parties involved. It’s a win for the client who gets sales and generates revenue. It’s a win for the affiliate who is able to monetize his audience and traffic. And, it’s a win for us as an agency because we succeed when our clients succeed.
