The Importance of Affiliate Channel Alignment and Equipping Your Publishers

[00:00:48] Jamie: Hey everyone, welcome to today’s episode of the Profitable Performance Marketing podcast. I am your host, Jamie Birch and founder of the award winning affiliate management agency, JEBCommerce. That is who is supporting and that’s who’s bringing you this podcast today. Very excited to talk to you today about alignment of your affiliate channel and really subtitle of this episode is making sure your affiliates have the proper tools that they need to reach the goals that you have for them.

[00:01:19] Before we get started we released four new packages of our services at  JEBCommerce.com/elements and see those packages. One of the problems in our space in the agency world and affiliate marketing has really been a lack of transparency of what advertisers get for the money that they’re spending. So we tackled that. Our new CEO, Jake Fuller put that in place not too long ago so that we have four packages available at JEBCommerce.com/elements.

[00:01:50] Everything ranging from just need a little help monitoring, make sure nothing’s going wrong all the way up to white-glove top-shelf service that JEBCommerce has been known for over the 19 years we’ve been in business. So if you are looking for help in your affiliate program, looking to make 2024 the best year you’ve ever had and achieve your specific goals, and maybe you’re even trying to figure out how to give the affiliates the tools they need, and align them and their goals with yours. We would love to help with that. So you can go to JEBCommerce.com/elements. You can also email gethelp@jebcommerce.com to find out more as well, and Jake and the team will reach out to you very, very quickly. So anyway, go check that out. If you’re an advertiser that needs help, we would love to help you.

[00:02:37] So today, what I wanted to talk about is really top of mind. It’s an area that often gets missed, and I think it’s because the general view of ” affiliates is they’re out there doing this thing. I’m going to give them the tools that I have. I can do what I can do.”

[00:02:53] That’s really it, and that’s a big misconception. You have to think of affiliates as partners. So one thing you’ve heard me say in this podcast over and over and over again is this is about relationships and that means partnerships. So, in order to get what you want, you kind of have to know what your partner needs, right?

[00:03:13] Think about partnerships. Those are good for both parties. All too often, and I think this comes from when this industry started the advertisers or merchants, that’s what we called them at the time, they really drove everything. They had all the power, they spent the money, all the money flowed from them.

[00:03:31] And so they just put out what they had. And that’s sort of still been around, but that’s really short sighted. So let’s talk about this idea of alignment in order to have a successful channel, whether that’s affiliate marketing or any other digital marketing channel, frankly, any other sales or marketing channel at all, you have to have alignment from the top goal, whether that’s the board or the CEO, all the way down to that last step in the process and even the consumer.

[00:04:01] Getting those and each step along the way aligned is a great way to ensure success. So you want to think of a couple of things when it comes to alignment. You want to think of making sure you know what the goal is.

[00:04:15] You’d be surprised, maybe some of you who’ve been around as long as I have wouldn’t, of how many times the affiliate manager or the digital marketing manager, the person that has affiliate marketing in their purview, they don’t actually know what the overarching goal of the company is.

[00:04:33] So what do they do? And this has kind of led to a problem in the space and what people look at this channel. A lot of times affiliate managers come up and they don’t have any formal training and they’re just maybe that upstart kid who seems to be able to handle whatever’s thrown at them and they get that affiliate channel. That’s exactly how I started.

[00:04:53] And so they don’t really know some of the things that really need to happen. So if you’re one of those and trying to figure this out, you need to know what the goals of your company are. What are they trying to achieve? We’ve had clients that their goal was just customer acquisition at a certain cost, as many customers as you can at this cost, as far as how much revenue they weren’t concerned, how much margin weren’t concerned, they were in a high growth phase. That’s what they were trying to achieve.

[00:05:20] We’ve had other clients where they are trying to position their company for sale. So you can see those two examples, widely different on one hand, with the growth, we just needed to get as many partners who could drive a new customer for that amount. How much revenue they drove wasn’t important, how much profit that didn’t matter at all. They just wanted to see customer acquisition.

[00:05:46] On the other hand, they weren’t so concerned about number of customers, they were more concerned about margins. So as the company was getting ready to sell, they wanted to be able to show as much profit as possible. So your entire strategy revolves around, centers on, comes from that overarching goal of the entire company.

[00:06:08] You get that alignment and then that goes all the way down the channel to the affiliate manager, to the networks, to the affiliates, and even to the consumer. Now you can see if the CEO wants to get a customer acquisition and the affiliate manager is trying to drive profitable sales, while those two can sometimes work well together many times they are competing against each other.

[00:06:32] So you have to know as the person in charge of the affiliate program, what that overarching goal is so you can develop the strategy to get there. There’s all these touch points along the way from the top of the company down to the affiliate, you have the affiliate manager. You have the network, you have the affiliates. You have the consumers. Sometimes you have sub affiliates in there. And when I’m talking about alignment, I’m talking about alignment of pay structure, alignment of technology and tracking, alignment of reporting, alignment of consumer offers and all the technology to make that happen.

[00:07:08] If you’re trying to drive new customer acquisition and profit margin, and overall revenue is not an issue for you, do your offers reflect that? Because if you’re not worried about profit, you just want to have the best offer out there, that may be part of the strategy. You may want to have the highest commission out there.

[00:07:29] And you want to report on those things. Now, if you were looking for profit and margin, that may mean you’re commissioning much differently on individual products. There’s a podcast we released on commissioning on individual products. And that may be the strategy. So you may be providing affiliates with a higher commission on those products, and you may be giving consumers a higher offer on those products or some sort of maybe a buy two get one offer or something like that. You want to make sure you have all that and you want to make sure really the affiliates have the tools that they need.

[00:08:06] Let’s go through an example and we’ll walk through that. We get a lot of advertisers coming to us and they want new customer acquisition, and there’s other podcast episodes and blog posts that we talk about.

[00:08:19] Exactly where that comes from. Why do they only want new customer acquisition? It’s primarily how they view the affiliate channel and for them it’s the belief that affiliates are only closing. ” I don’t want to pay for those closers. I just want to pay for the new customers.” So even understanding what’s behind that can really help.

[00:08:36] But say we’re looking to run a program that is primarily about new customer acquisition. What is alignment and what are we talking about when we talk about tools for this example? First we want to get new customer acquisition. We want new customers. We have to make sure the tracking is aligned. “So are we tracking new customers? Are we reporting on that? Are we able to show in the network how many of those customers coming in are new, and how many aren’t new? Are we doing that also in our database of record?

[00:09:08] It’s probably one of the biggest things people miss when they’re setting up their goals for the affiliate program is they’re not reporting or setting up tracking at all. The majority of people of advertisers who look for new customers, they’re going to do that reporting on the backend.

[00:09:23] They’re going to later on, maybe at month end, they’re going to do some analysis on their end and say, “okay, the affiliate program drove 25 percent new to file. And our goal is 40%. What are we going to do?” Well, that’s a lagging indicator now.

[00:09:38] So now we have a lagging indicator. All we can see is what happened. We can’t actually do anything really about it. We don’t know what partners are generating new customers. We don’t know even who those customers are and the affiliates don’t either. So you first have to make sure that the tracking is set up and, as far as I know, every single affiliate network has tracking where you can report whether that customer is new.

[00:10:04] And there’s some really creative ways you can get to new. Every single advertiser we’ve ever worked with has a different definition of what new is. One we’ve worked with for over 10 years, if you hadn’t shopped with them in 12 months, then you were brand new again. Others, if anyone in that household has ever shopped through any channel before you’re not new.

[00:10:26] They householded the new to file. So, you have to figure that out and then you want to track that. And you want to make sure it’s reporting in the network and it’s also reporting in your database of record. Your database of record, whether that’s Google analytics or what have you, that’s great for you to know, but your affiliate partners can’t see. They don’t know what’s going on.

[00:10:46] So that leads us to our next one, and that’s reporting. The affiliates need to know what activities they’re doing are driving the most new customers. So is the placement within the email that I’m sending to consumers? Is that generating new revenue?

[00:11:01] And even if you can get to a point where the affiliate is allowed to identify the actual customer, so they can look back and say, “this customer was new,” they can then tie everything back to that and their marketing. They can just target their consumers who haven’t shopped with you yet.

[00:11:20] So you want to make sure you’re reporting. That’s a tool for them as well. Knowing exactly what is happening in regard to your goal.

[00:11:29] The other is pay structure. If you’re looking for a new customer acquisition and you’re paying on all orders the same, well, you’re missing the boat. Now they’re not incentivized to drive those new customers.

[00:11:41] You want to make sure your commission structure is such that it is incentivizing what you want from your affiliates. So if you want new customers, then incentivize them to get paid better for those new customers. Again, you’ve already had your tracking. You already had your reporting. Now you’re paying the affiliates a much different rate for those new customers. Why? Because they’re more valuable to you. That’s what you want.

[00:12:06] The next area is that offer for the consumer. Now we’re getting really into an actual frontline tool that affiliates can use and that is the offers. So in this case, you want new customers only. One, you gotta be able to be tracking them. You’re reporting back and forth on which ones are new. So the affiliate knows they can tell which one is a new customer, what marketing activity led to that new customer. Now you want to make sure you’re giving them offers that only new customers can use.

[00:12:39] And those primarily come into two different categories. That is a new customer only offer. And this is sometimes very hard to set up, but if you’re trying to drive that type of activity, isn’t it worth it to set this up? On the backend, if you’re recognizing whether that customer is new or not in checkout, so that you can track and report on it, you should be able to check if an offer is suitable for them.

[00:13:05] So you should be able to give a consumer offer that’s only available to new customers, and only works for new customers. And then the other one is a single use coupon. So here’s a coupon code, it’s only available once. That will help with the new customers cause they can’t use that coupon code again. And other affiliates can’t get that coupon code as well.

[00:13:27] So you want to make sure that your consumer offers, and now that also means the creative you have available to them. So are, what are you providing that is it attractive to new customers? Are you promoting and do you have products that are new customer centric? Do you have an introductory product, a product that most people who don’t know your brand come in first?

[00:13:48] Well, you should be commissioning high on that, commissioning high on new customers, and offering that to the affiliate. You may even give them free product to give away. Free trial offers, those are really good for that particular idea.

[00:14:02] You want to look at what’s that top goal. Okay, it’s new customer acquisition. Do they have everything they possibly could need to make that happen? If you’re not reporting on it, and you’re not tracking on it, and you don’t have tools specific for new customers, then how are they going to affect that change?

[00:14:19] And see a lot of advertisers believe that the affiliates can’t affect that change and that whether they get a new customer or not is happenstance, is coincidence. But I’ve worked on well over 2-300 programs over 24 years now, and that is not the case.

[00:14:37] There are so many affiliates that are so crafty, creative, and then they have a lot of consumer information that they’re able to target those new customers that they’re able to target that goal.

[00:14:49] So it also involves discussion. Relationship again, we’re back to that. Who are they? What are they doing? How do they do things? What can they offer? One of the tools you want to look at is paid placement budget. So actually providing and buying placement before. Some people think that goes a little counter to affiliate marketing and that affiliate marketing is primarily where, I pay after the sale happens, but sometimes you have to give affiliates a better tool to hit the target that you want to hit. And in this example, if it’s new customer acquisition, you want to make sure that happens.

[00:15:26] So now, if we think of another example, like we only want premium buyers, that’s going to be the partner type that you’re bringing in. You may not want to work with the closers. You may want to work with content affiliates. They’re probably going to need content. Much different content, free product, they’re going to need unique ways to track because to get that top level consumer or the consumer at the top of the funnel, of the purchasing decision, you’re going to need to provide them with some introductory content.

[00:15:57] You’re going to need to provide them with different tracking links. Cause they’re probably out there on social media, in video, and sometimes in person talking about your product. So a link that you click, isn’t always going to work. You’ll need to do something like LinkConnector has naked links.

[00:16:13] And a whole bunch of others have a bunch of different ways that you can track. I mean, you could paint it on the side of a van and someone could type that code in and they’d get credit. So coupon tracking, naked links from LinkConnector, stuff like that, you need to be aligned with what you’re doing and you probably are going to need a paid placement budget because that’s how they operate.

[00:16:36] And you’re probably going to need a longer lead time, both in return or cookie days for the affiliate and also in deciding whether this campaign worked or not. Another tool that you need to provide that provides alignment is that return or cookie day. So if you’re looking to just generate as many sales as you can through the channel, that’s your goal, well then set the cookie day for whatever you like, and you’ll probably be fine.

[00:17:01] Now, if you’re trying to get new customers or you’re focusing on content affiliates and get that top of funnel consumer, the introducers you want to promote, you’re probably going to want to go with a much longer cookie day, primarily because that funnel needs to work.

[00:17:18] And if you want those people that are getting consumers at the top of the funnel, the introductory stage, you’re going to want to reward them for as long as possible, depending on your sales cycle. So if you’re selling a mattress and the sales cycle is 260 days, you probably want to give a little more of the cookie day to make sure that that affiliate gets rewarded.

[00:17:40] So you got to start thinking differently about the tools you’re providing. It isn’t just, I’m going to give them whatever I want and we’ll be fine. And they’ll do what they need to do. You have to look at each partner. You have to compare them to your goals and you have to make sure that you have alignment and that you’re offering them the tools that they need to be successful because it’s not always the same. You can even get down to partner by partner and what they need, and at JEBCommerce, we do a ton of that. It is very much partner by partner.

[00:18:14] So definitely look at it like that alignment. Proper affiliate tools. And you know what? I hope this was helpful. If you have questions about this and you’re like, “Jamie, I get it, but I don’t know exactly what tools are available to reach my goal and my partners.” I would love to help. You can email all of us at gethelp@jebcommerce.com. Myself or Jake will reach out to you and we can set up a time, no obligation. Set up a time for us to chat about these things.

[00:18:42] And you know, help us out. If you know someone who needs to hear this, send this episode over to them, share it on Facebook, LinkedIn, X, and anywhere on social media. That’ll really help get the word out, but what really helps is a five star review, whether you’re on Apple Podcast, Spotify, or the podcast player of your choice. Those five star reviews really go a long way.

[00:19:04] And we’re still looking for guests, starting to line things up for season four, which will happen in the fall of 2024. And we would love to have you on the show. So email us at gethelp@jebcommerce.com, and we will make sure we get you on the show.

[00:19:19] And then don’t forget to check out JEBCommerce.com/elements. If you’re an advertiser and you’re trying to grow your affiliate program, whether that’s new customer acquisition, overall sales, trying to gain market share, box a competitor out, whatever that is, we would love to help you do that.

[00:19:36] We’ve been doing affiliate marketing at JEB for 19 years, actually just celebrated 19 years in October. We’ve managed well over 200 or 300 programs, and our team has done an outstanding job. We would love to take our years of experience and our years of building those partnerships and deploy ’em on your behalf.

[00:19:58] So anyway, thank you so much. Thanks for getting to this part of the podcast. Don’t forget to share it. If you have ideas, if you have things you’d like to hear from us, just let us know at gethelp@jebcommerce.com. We’ll make sure we get that on the podcast. Thank you.