May 11, 2015
Loyalty, coupon, content, technology, blogger, social – there are so many business models being used by affiliates, how do you know which will be the best fit for your business, and more importantly, drive sales to develop an effective partnership? As an agency that manages affiliate programs across multiple industries and verticals, we are responsible for quickly understanding the business model of an affiliate, comparing that to the strategy of our programs, then determining if they are a viable fit.
Here are five questions we use to benchmark the potential of an affiliate for a program:
Is the affiliate responsive?
Are they dedicated to making it work? Even the best affiliate sites can underperform if the affiliate is asleep at the wheel. If either side cannot communicate and keep development of an activation or optimization process moving forward, then it will be difficult to understand the potential of the partnership. Lack of communication will result in frustration and inefficiency.
What is the affiliate’s historical performance across other programs?
Keep an eye on top industry performers to make sure they are in the program and driving traffic. These affiliates have typically achieved the highest network earnings and have proven their value by driving revenue across numerous programs. Use network earnings in context as an affiliate may be particularly strong for a certain vertical that is not necessarily a fit for a different program. Don’t categorically decline an affiliate after one bad experience and plan to revisit any missing affiliate categories within a specific timeline. Business strategies shift on both sides and what may not have been a good fit in the past, could prove effective for the future. Work to create diversity in the affiliate program to minimize risk with affiliate categories and individual affiliates. Working with different types of affiliates across several categories uncovers more opportunities for the program in the long run, while providing a healthy foundation to grow on.
Is the affiliate’s business model a good fit for the product and program strategy?
Don’t be afraid to ask the affiliate about the demographics of their visitor base. Ask how they are driving traffic to their site. Make sure the program is aligned with their model and the type of visitors they have on their site. For example, most lead programs do not perform well with incentive sites. An incentive site, a site that rewards members for performing an action, opens the door to low- to no- value actions for lead programs. If a member is rewarded for filling out an interest form for a car loan, the actual desire to buy will likely be non-existent. This clogs the lead funnel and drains an affiliate budget. On the other hand, a retail program may do well with incentive sites.
What is the affiliate’s potential?
Affiliates with a solid base of visitors and a roadmap to continue to grow traffic to their site illustrate that the partnership can grow along with them. Having a significant and engaged audience can be difficult to cultivate, but is necessary when choosing partnerships that have the best chance of driving high quality actions. As a program manager, choose partnerships with long-term potential. Some affiliates may be very enthusiastic, but get a feel for their potential in the initial stages and try to focus on the partners with a proven track record or at least a solid plan for growth. Don’t be afraid to push to establish partnerships you feel strongly about, even if the model is new to the program or industry.
What does the affiliate need for the partnership?
Do they require a datafeed? An exclusive offer? VIP payout rate? Trademark+ allowance? If you can’t allow certain tools, it could be a waste of both of your time to engage. In other words, identify the deal breakers before you get too deep into the conversation. If an affiliate asks for many custom items prior to working with your client, try recommending a phased approach and leverage the tools you already have for optimization to minimize the risk and prove the affiliate’s value. The advertiser will likely be more receptive to custom requests once they can get a feel for the type of volume the affiliate can drive.
The success of our affiliate programs rely on our ability to quickly approve or disqualify an affiliate for a program, and to direct resources toward affiliates that have the potential to drive high-value actions for our clients.
If you’re interested in learning more about Schaaf-PartnerCentric’s affiliate recruitment techniques, please request a consultation.