Now that the rush of Q4 is behind us, and many of you have been able to settle in to the new year, it’s time to look ahead. Many of our affiliate marketing clients are working with us on their entire 2016 and 2017 plans and one common question we field is “What is the biggest mistake other advertisers make in affiliate marketing?” It’s such a great question, and so relevant as many are planning for Q4 already, that I thought I’d ask a group of the most experienced, smartest and well known individuals in the space and hear what they have to say. I spoke with Networks, Affiliates, JEB Alum (so proud of you Jenn!) and others, here is what they had to say:
“Advertisers need to look at affiliate marketing as a completely different concept than paid search, a CPM media buy, etc. While those areas can offer immediate results, an affiliate program is a slow burn in the beginning and it requires patience as affiliates are recruited and activated.”
“I would say that the biggest mistake I have seen in my time as an Affiliate Manager is relying too heavily on a few key publishers and not having enough diversity. I have seen publishers make one change to their website, or Google will launch an update, and they will lose an incredible amount of traffic and revenue. If this is one of your key publishers… no bueno. This can cripple a forecast and leave the advertiser scrambling to quickly ramp up new publishers or spend unnecessarily on last minute placements with other publishers to try and make forecast. There will always be key top performers, but I recommend constantly keeping your pipeline full of new publishers and working with them on a consistent basis to keep your affiliate profile as diverse as possible.”
“I think the #1 mistake being made right now is forgetting that this business is primarily about relationships. There is so much focus on attribution, big data, etc… (all good things) but some attention should be just paid specifically to the Affiliates. In the course of all of this technology discussion, Affiliate Managers have gotten away from the core of this industry which is building relationships with Affiliates who can bring you customers. If you want to build a program with quality bloggers, content sites and top-of-funnel affiliates – then you have to get serious about rewarding those affiliates for the work that they do and not making internal excuses to pay them less due to channel conflict.”
“Because affiliates are paid only on a performance basis, the merchants need to be sure they are doing everything they can to help affiliate conversions and do not do anything to take away from them such as leaks on their site or using technology that overwrites affiliate cookies. The biggest mistake a merchant can make is to allow technical issues or leaks to negate commissions. Affiliates trust that when they send their traffic to a merchant, the merchant will follow through in such a way as to close the sale for the affiliates.”
“The #1 mistake Advertisers tend to make in their affiliate programs is saying “no” to quickly. Too often, brands don’t launch with publishers solely because they don’t see their competitors working with them. Don’t be afraid to be the first to test or partner with a publisher- it can benefit the brand immensely by getting in before others! Also, be flexible with working with different publisher models. For example, working with hosted cart will open a lot of doors for a brand that may not be super well known or have shipping thresholds.”
“The biggest mistake that we see advertiser make is hiding their sale, deal and coupon offers in images. Many advertisers don’t understand that their deals will have a greater chance of seeing the light of day if they place them in text. Though some affiliates like to use banners, the top-producing deal affiliates work with text. They use text-based deals to fulfill the content on their searchable, sortable database sites and apps. So, if advertisers are hoping to get volume and targeted promotion behind their deals, they need to place the content into text – not just on banners.”
“The biggest mistake advertisers make is thinking that a successful affiliate program can run on auto-pilot. This ‘set it and forget it’ mentality only works if the advertiser simply doesn’t care about nurturing and growing their program. Affiliate marketing has always been about one integral piece of business: relationships. If an advertiser wants to avoid the most common pitfalls of affiliate marketing, they’ll understand that the short time it takes to build up a connection with each affiliate individually will pay off tenfold down the line.”
“I think the #1 mistake advertisers make is ignoring the regulatory environment and the nexus laws. Not only ignoring them outright, but also not understanding how much of an affect they can individually have on these laws that are passed or proposed in their states. A few conversations and even testimony in front of their legislators can have a dramatic effect on our industry. Most advertisers/merchants don’t realize what effects these laws can have not only on their affiliate marketing program, but on their company as a whole; ignoring the problem doesn’t make it go away. We have an issue right now in Utah that could take 100% of my time. Advertisers should get involved.”
“As an affiliate publisher since 1999, I’ve seen some very creative advertiser strategies. I’ve also seen some that were lackluster to say the least. A common mistake is to reach out as if all affiliate publishers are essentially the same — with the same needs, motivation, performance potential, etc. — and to communicate en masse using these assumptions.
Instead, I think it makes more sense to reach out individually to your top publishers (and prospects) and customize creative, incentives, and marketing messages for them and their unique audiences. Affiliate marketing is built on relationships and works best when the relationship is truly win-win. It’s difficult to create such opportunities without an actual relationship built on individual attention and conversation. So, my advice — get to know your best affiliate publishers and personally tend to them.”
And then we have over-achievers who give us two mistakes. They are so good that I had to include both. Thanks Joe!
“1. One of the biggest mistakes a merchant can make with their affiliate program is not securing well trained, experienced, knowledgeable people to run their affiliate program. Many times the affiliate program just gets lumped into other paid marketing channels or even worse gets pawned off on someone with no marketing experience. A qualified and dedicated affiliate manager is vital to the success of most affiliate programs. They know the industry, they know who the affiliates are, they can recruit new affiliates, they can spot fraudulent affiliates before they can do damage, and they know how to find value in the affiliate channel. Without a good affiliate manager an affiliate program has almost zero chance of succeeding.
2. Another mistake is valuing all affiliates the same. Many affiliate programs just pay all affiliates the same no matter how they generate their sales. The value of affiliates has a huge range and thus every affiliate should be examined and paid according to the value they bring to an affiliate program. Does the affiliate generate new customers? Are they introducing the brand to new audiences? Is the affiliate closing the sales of existing customers? If the affiliate weren’t in the program would the sales still be there? Does the affiliate drive higher than average orders? Is the affiliate helpful in selling stale or outdated product that needs to be cleared out of the warehouses? Answer questions like this and soon you will be able to see what sort of value the individual affiliates are worth and you can then adjust your commissions accordingly. Tools like the Advanced Commission Structures and Conversion Lines in Shareasale and Avantmetrics in Avantlink are awesome tools to help you set some rules that reward affiliates according to their value.”
“The biggest mistake I see people making in their affiliate programs is that they don’t place a high enough priority recruiting new affiliates. I’ve never spoken with an affiliate manager that claimed they had enough affiliates — and yet, it’s clear from the actions that people take that recruiting is the first thing to be cut on the to-do list.”
“Affiliate Managers frequently decry the value of coupon/discount affiliates, believing that customers turn to those sites as the final step in the purchase process, merely overwriting existing cookies and adding no incremental value. This could not be further from the truth. Since coupon sites can now account for 25% or more of all sales, it is important to understand and properly manage this affiliate type.”
“One of the most costly mistakes an advertiser can make is the lack of long-term commitment in nurturing their affiliate marketing efforts. Fundamentally, the success of an affiliate program is driven by affiliate relationships. Affiliates are digital marketing entrepreneurs on the forefront of creativity. Advertisers will fail to unlock the full potential of their affiliate program without continuously investing effort to engage affiliates (beyond only those that are actively promoting) and talk with them to find out what tools, permissions, promotions or content would help them effectively drive revenue.”
“Advertisers in the affiliate channel can lose focus on ensuring that their sales are truly incremental. Affiliates often try to move their attribution as close to the sales as possible so if advertisers aren’t considering multi-touch attribution there is a good chance they aren’t calculating incremental contribution correctly. Similarly, advertisers might believe ‘too good to be true’ performance statistics or trust assurances from deceptive affiliates about the sources of their traffic. On the other end, performance marketers might balk at flat promotional fees (“hey, that’s not performance marketing”) without considering whether those promotions would in fact generate incremental sales.”
Wow, I’m overwhelmed at the response my little email got. Thank you all for your tremendous input. Truly some of the best minds in our space, it’s an honor to call them friends. So, that was a lot of information to digest. Here is what I heard from their contribution to this discussion:
- Affiliate marketing isn’t a quick fix. It’s a slow burn that needs focused attention, and intention, over time to be successful. It can be a huge bon fire, but it takes time.
- You need to diversify your revenue by affiliate as well as your mix. You can’t rely on just a few affiliates to generate your channel’s revenue. You have to be sure you have many affiliates to distribute that revenue and protect your affiliate channel revenue. And you need to work with many different types of publishers to ensure a successful program.
- Affiliate marketing is about relationships. It isn’t a trip you can trigger, an ad campaign you can tweak nor a simple keyword to add. It takes time and attention to develop, strengthen and maintain the relationships that will prove to be profitable.
- Site optimization to ensure your affiliate traffic converts to sales, or whatever action you desire, needs to be a priority for your channel. Affiliates will take their traffic somewhere else if you can’t convert. You also need to shore up any leaks on your site.
- Don’t hide your sale and coupon information in images, provide text. Creative is incredibly valuable to affiliates, but in that bucket, there needs to be lots of text creative.
- Auto-Pilot – You need good, experienced, ambitious and well trained affiliate managers in the captains chair of your affiliate channel. You can’t get the profitable and incremental results you need with no one or someone unqualified.
- Don’t ignore the regulatory and legislative environment of digital marketing. It could affect your affiliate channel and your company greatly. My personal note is this – join the Performance Marketing Association and help them help you!
- Each affiliate is an individual. Don’t treat them as cookie cutter.
- Advertisers undervalue affiliate recruitment more than any other channel. Add focus and intentionality to finding and building relationships with new affiliates.
- Coupon Affiliates are not bottom feeders. Affiliate Window has some great data to share in that regard that I didn’t have space here.
- Most advertisers fail to keep tabs on incremental sales.
What say you? Got another one we missed here? Please add it to the comments below. Thanks to all my contributors! You guys are truly awesome!