You've probably heard of affiliate marketing - it's a great way to drive incremental sales. But how do you get started?
It can seem daunting, but with the right tools and resources, you can launch a successful affiliate marketing program for your brand. In this article, I'll walk you through the basics of affiliate marketing and show you how to get started.
Why Do You Want to Do Affiliate Marketing?
You may need to grow your online sales or comp pandemic level eCommerce sales. Affiliates are an additional channel to grow your sales and put your brand in front of more trusted eyeballs. They could be influencers, bloggers, category specific sites, discount or cash back sites ... there are many varieties.
Simply, you create offers or links with an affiliate aggregator platform such as Commission factory, Rakuten or Partnerize and when sales come through those affiliate partners that you've approved to advertise your brand, you pay a commission post sale. Generally 5-10%, but as low as 3% and as high as 20% depending on the category and your appetite for growth.
The key here is that most of your costs come on the backend of sales. While there are often signup, setup or ongoing monthly fees, any existing brand will find this no different that a monthly SAAS subscription. I've worked with many in different markets and have always had great results. Most brands that I work with pay out commissions in the 10-20k+ per month range which means they are generally seeing a few million dollars per annum in affiliate sales. Holiday periods can be 3X which are coming up quickly and now is the time to establish or optimise your programs for maximum holiday results.
In Australia, Commission Factory is the market leader.
They were acquired by AWIN a few years ago, but haven't changed much since the acquisition. They represent approximately 700 brands currently and many are household names, such as: Taking Shape, Catch, Asics, Hello Molly, Bing Lee, Lovehoney, Calvin Klein, Tommy Hilfiger, Esther & Co., and Blue Illusion. At Mosaic Brands, I've worked with Rakuten across performance based advertising with great results.
Sites like Shopback or Cashrewards, Qantas rewards, and even Little Birdie are all publishers of these types of affiliate programs.
What Is Affiliate Marketing?
Affiliate marketing is a way for brands (the advertiser) to partner with individuals and businesses to promote their products and services. In return, the affiliate (the publisher) gets paid a commission for sales that are made as a result of their promotional efforts across a designated time e.g. 30 or 45 days.
In an ere where retargeting and cookies are now constricted, affiliate marketing can be a great way to increase your brand's reach and grow your customer base.
However, it's important to choose affiliates that are a good fit for your brand and align with your values and goals. Affiliate platforms allow you to approve advertisers or set automated approval requirements. You are in charge of your promotions and banners as affiliate publishers promote what you provide.
Why Should You Consider Affiliate Marketing?
There are a number of reasons why you should consider affiliate marketing for your brand. First and foremost, affiliate marketing is a great way to increase traffic and sales at a low cost and with low risk. It's a low-cost way to promote your products and services, and can help you build relationships with key partners and trusted customers of those partners.
One popular program for pure play brands that I work with is Partnerize. They focus on the qualitative side of affiliate marketing and with their acquisition of Pepperjam, have a robust platform to leverage all types of (affiliate) partnerships.
Affiliate marketing can also help you create a more engaged community around your brand, and give your most loyal customers and influencers a way to support your brand while getting rewarded for doing so. Ultimately, affiliate marketing can help you generate new users and customers to your brand as trust comes from the publisher and their network or fanbase.
Affiliates or Influencers?
Influencers can be affiliates. When you track engagement through a code or commission it enters an affiliate partnership. Even Shopify is getting into the influencer game. They just launched the new Collabs platform to connect sellers with influencers:
“We really think that creators are the next generation of entrepreneurs but they face challenges on how to monetize their content. We’re really trying to help the creator/influencer bridge this gap from creating content to actually monetizing it as they enter commerce,” - Amir Kabbara, director of product at Shopify
How to Get Started With Affiliate Marketing
So you've decided to start exploring affiliate marketing as a way to promote your brand. Great!
But how do you get started?
I can help. I frequently consult to national retailers, as well as pure play online business across affiliate and influencer programs, optimisation of existing programs, as well as auditing and evaluating the opportunities for your brand or group across new and exisiting marketing channels.
Your eCommerce team can also help get you started or I can work with them.
First, you'll need to think about an affiliate program. This is where you'll work through the terms and conditions of your program, including what products or services are you'd like to promote, what the commission rates will be (flat or tiered), and whether you want to create your own platform and manage partners or use an existing platform or aggregator. This often depends on size. As a national retailer or group, it would be a fantastic opportunity to create your own media network and advertising opportunities across your own sites utilising your 1st party data, but that is more complicated than need be.
Once your affiliate program is set up, you'll need to find or choose affiliates to promote your products. You can do this by posting in online forums, contacting bloggers, reward & cash back sites or social media influencers that occupy a relevant space. You might run ads targeting potential affiliates and certainly can use your own site(s) and real estate to generate inbound leads.
Once you've found some relevant and interested affiliates, it's time to get them started. This can be done by providing them with links or banners that they can use on their websites or social media profiles, and by providing them with marketing materials that they can use to promote your products. These will come from a self-managed platform or fully managed offering, such as a managed tier offered by Partnerize (they offer both managed and self-managed).
What Are the Benefits of Affiliate Marketing?
There are a lot of benefits to affiliate marketing, and that's why so many brands are using it to promote their products. Here are some of the main benefits:
1. Affiliate marketing is a great way to attract new customers. By partnering with other sites & brands, you can reach a new audience that you wouldn't have been able to reach on your own.
Tip: What about a brand swap? I've spoken to leading retailers in beauty and fashion and both have agreed to swap order inserts for free!
2. Affiliate marketing is a cost-effective way to promote your products. There's no need to invest in expensive advertising campaigns or hire a marketing team.
Tip: For best results, frequently generate content that mirrors your promotional activity with multiple styles and sizes of banners, social squares and offers.
3. Affiliate marketing is a great way to build relationships with other brands. When you work with other brands, you create a mutually beneficial relationship that can help both businesses grow.
Tip: This can be a top-tier channel with the right support and commitment. If you are going to do affiliate marketing, make sure it's fully supported internally!
4. Affiliate marketing helps you build trust with your customers. When customers see that you're working with reputable brands, they'll be more likely to trust your brand and products.
Tip: Trust is everything! Customer acquisition can come from many places. Tap into trusted networks of new customers by working with new influencers, sites and blogs. Choosing the best channels will net the best results.
How to Find the Right Affiliate Partners
Now that you understand the basics of affiliate marketing, it's time to start finding affiliates to help promote your brand. But how do you go about finding the right partners?
There are a few things you need to keep in mind when selecting affiliates:
-The audience for their website or social media platform
-The type of content they produce
-The tone of their brand
-Their cost or commission structure
-How easy they are to work with
Take some time to research different affiliates and influencers and see which ones would be the best fit for your brand. When you find the right partners, the benefits can be huge!
Test and Learn
Most (or near all) transactional websites can generate a discount or free shipping code or even an eGift Card. Generate some offers and offer them to some influencers that you find with similar brands on Instagram and TikTok. Did they generate any interest? When you work with different influencers, you may need to cater an offer to their audience.
Remember, not all offers need to be a discount! People love free shipping and they love a GWP "Gift With Purchase". Be creative. In retail, I always think "Be Creative, Don't Cannibalise." or BC/DC before deep discounting. A product lifecycle doesn't start at markdown.
How to Measure Success of Your Affiliate Campaigns
Now that you've set up your affiliate marketing campaigns, it's important to track how well they're performing. This will help you to identify which ones are working well and which ones need more work. There are a few different ways to measure the success of your campaigns:
1. Conversion Rate: This measures how many people who visit your affiliate link go on to make a purchase. To calculate it, divide the total number of affiliate driven sales made by the total number of visitors who clicked on your affiliate link.
2. Sales Revenue: This measures how much money you've earned from your affiliate marketing campaigns. To calculate it, simply add up the total value of all the products/services sold through your affiliate link per period e.g. Month, quarter or year.
3. Earnings Per Click (EPC): This measures how much money you earn for every person who clicks on your affiliate link. To calculate it, divide the total affiliate earnings by the total number of clicks on your affiliate link.
So Let's Go!
If you're interested in learning about how to get started with affiliate marketing for your brand? You've come to the right place! I've worked with many brands to get them started and it's a no-brainer, low-cost, low-risk, controllable, and seasonally predictable way to grow your sales.
We've discussed the basics of affiliate marketing, including what it is, how it works and some of the best platforms and programs out there. There is so much more!
About Mike Fowler
Mike is an eCommerce veteran, senior leader & growth strategist for some of Australia's best retailers. Formerly at Afterpay as Director of Merchant Services APAC, General Manager and founder of the growth team at Mosaic Brands (Noni B Group) developing and launching 9 iconic multi-category online marketplaces, including: Noni B, Rockmans, Millers, and Rivers, as well as Head of Digital at Blue Illusion. Member of the Australia Post Customer Advisory Group with more than 15 years experience in helping retailers leverage eCommerce, CX, payments, & logistics opportunities to maximise growth.
Contact Mike if you need advice across anything digital. Recent projects include:
• Westfield Direct marketplace w/ Mirakl & Westfield
• Information Memorandum and investment roadshow for SAAS platform
• Loyalty program consultancy and implementation
• Digital transformation & re-platforming
• UX/CX audits and site re-skinning and optimisation
• Same day & local delivery implementation for VIC based retailer
• BNPL & payments integration/implementation