Affiliate marketing programs are frequently neglected, despite being one of the most cost-effective forms of marketing. Unlike other online marketing tactics, affiliate marketing isn't just about creative ideas, technology, and analytics. It's primarily about building relationships. Managing an affiliate program is very much like managing an outsourced sales team of entrepreneurs who drive traffic and revenue. This requires a different mindset.
Affiliate marketing is a $6.5 billion business worldwide, including lead generation and delayed sales. On average, affiliates account for about 10 percent of visitors to merchant sites, according to MarketingSherpa's "Ecommerce Benchmark Guide 2006."
When introducing affiliate marketing into your mix, assess how it fits into the overall business plan. Diversify affiliates and avoid direct channel conflict while extending your reach. Since most affiliates are compensated on a CPA (define) basis, Aaron Cooper, Orbitz VP of online marketing, notes, "This model works to ensure that affiliate incentives are aligned with the company’s objectives."
Various affiliate business models add value in different ways. "Loyalty affiliates can yield higher average order value and conversion rates," said Kelli Beougher, LinkShare's distribution services VP, "affiliates who drive search traffic can generate more new customers, and niche sites can feature a promotion with tailored editorial content around it."
Five strategies to increase affiliate program productivity:
Metrics to Monitor
To assess your affiliate program's and individual affiliates' effectiveness:
Like any other marketing tactic, affiliates need support to deliver optimal results. Think in terms of affiliates being your outsourced sales force and you being their outsourced marketing department and an auxiliary. Affiliate marketing is about creating a partnership in which in-house marketers and affiliates work together to drive well-qualified traffic that converts to sales. This process requires a collaborative effort so both partners succeed and make money.
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Heidi Cohen is the President of Riverside Marketing Strategies, an interactive marketing consultancy. She has over 20 years' experience helping clients increase profitability by developing innovative marketing programs to acquire and retain customers based on solid analytics. Clients include New York Times Digital, AccuWeather.com, CheapTickets, and the UJA. Additionally, Riverside Marketing Strategies has worked with numerous other online content/media companies and e-tailers.
Prior to starting Riverside Marketing Strategies, Heidi held a number of senior-level marketing positions at The Economist, the Bookspan/Doubleday Direct division of Bertelsmann, and Citibank.
Heidi is also a popular speaker on current industry topics.
June 5, 2013
1:00pm ET / 10:00am PT
June 20, 2013
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