Top 5 Reasons Why Affiliates Are Our “Dumb” Marketing Channel
Did I just say that affiliates are “dumb?” You bet I did. I am referring to the definition of “dumb” which means “lacking some usual attribute or accompaniment; especially having no means of self-propulsion like a dumb barge.” What I mean is that affiliate marketers do not have the same advantages that your other marketing channels have: they lack the same tools for success that your SEM, SEO, email and display teams have.
Here are the top 5 reasons why our affiliates are forced into this position.
1. No Method To Exchange Information
As you market to prospective buyers, you learn which ad media, copy and strategies work better and which do not fare as well. Your affiliates are learning the same thing through their own trial and error efforts.
Unfortunately, most affiliate programs have no method to exchange and share these key learnings. One reason is that there is a social barrier to sharing. Affiliates do not want to share with you because they fear that the brand will only use them to test out channels and then cut them off. You do not want to share with your affiliates because you do not want channel competition from your affiliates.
Another reason is that there is no standardized way to share information. However, there can be great benefits to sharing like cost savings so that neither of you are testing channels that the other has already proven to be inefficient. It brings up questions like:
- What do you share?
- In what format is information shared?
- Which affiliates should benefit from shared information?
- How can you share in a uniform way that doesn’t burden your staff?
Probably the least controversial information to share are those things that didn’t work. You could start by releasing your web analytics data on media and ad copy with low ROI, so that affiliates know what to avoid. The same will hold true from the affiliate end—they ought to do the same type of sharing. You can make your information sharing conditional on reciprocation, and you can also limit which affiliates can take advantage of the information exchange (for example, top earners, affiliates with a working history with you where they have exhibited good behavior, and so on).
2. Lack Of Web Analytics Data
There is always more to a sale then the sale itself. The entire web analytics funnel plays into how you measure the success of various ad media including drop-off rates, bounce rates, page views, site hang-time and goal pages. Affiliates typically have no visibility into the web analytics funnel. Their viewpoint is limited to purchases only.
In the interest of sharing, if you can attribute traffic to a specific affiliate using your web analytics program, it makes sense that you would share the data with that affiliate. Meaning each affiliate would get the opportunity to review the web analytics funnel for traffic that the affiliate has driven to your website. Equally helpful is for the affiliate to benchmark itself against other traffic you receive by shared data on site averages, and the affiliate’s increase or decrease in relation to the average.
3. Missing Purchase History
You hold all of the cards regarding purchase history. You know things like which buyers are repeat buyers, what the future value of a customer might be based on purchasing behavior and the lifetime value of customers driven to you via various channels. Your affiliates have none of this information. It isn’t reasonable or ethical to share customer-specific purchase history, but it is reasonable to share channel specific history.
If you know that certain keyword types (for example, product part numbers) generate customers with a high lifetime value, that is the kind of information you want to share with your affiliates. Sharing this kind of information is self-serving; it helps you direct your affiliates to run campaigns in places where you will get the most revenue. Sharing in this instance will help you to encourage your affiliates to focus their efforts on the ad media that you deem to be most valuable.
4. Unknown Or Fuzzy Demographics
Affiliates probably do not know your sweet spot with regard to demographics and targeting. In the absence of insights from you, top affiliates use common sense and experience to figure this out. Smaller affiliates probably have no way to determine your target demographics and may drop out of your program due to costly failures before they get the chance to drive a return for you. If you don’t already do this, you should consider publishing information and offer training to direct your affiliates to the demographics of consumers that are the most valuable for your business.
5. Lack Of Attribution Data
Attribution refers to tracking the marketing activities that generate a sale. Last-click attribution, for example, is where the only marketing effort tied to a sale is the one that generated the click immediately preceding the purchase event. There is also first-touch attribution and multi-touch attribution. Multi-touch attribution is where all of the marketing touch points are tied to the sale so that insights can be gleaned about things like how many visits take place before a purchase occurs, the time span between visits or visitor progression such as with keyword search history leading to the sale.
The problem again arises for affiliates because their only insight is usually regarding the last-click. There is no insight as to the multitude of marketing touch points that ultimately lead the consumer to make the purchase.
Further, as I mentioned in Is The “Last Click Wins” Model Best For Your Affiliates?, there is no credit given to affiliates who drove traffic that pre-dates the last click. You could strengthen your affiliates via tracking attribution by giving some financial credit for participation in the sale, or you could share attribution insights so that affiliates can market smarter and better on your behalf.
I theorize that in the absence of this data exchange, affiliates evolve from “dumb” to something more only after their own trial and error has shown them the best marketing methods. This means that only the affiliates with the fortitude for risk will stick around to reap the rewards. Smaller affiliates or those with less attention span may be likely to drop out of your program early or even complain about their lack of success, making it harder for you to recruit other affiliates.
If you can, you should consider sharing information with your affiliates to make them smarter upfront and work harder for you long-term.
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