As marketers absorb the pandemic’s impact, it is critical to reflect on which strategies born out of necessity are here to stay. Learn why marketers lean into affiliate in times of uncertainty, which tactics earned staying power in the channel’s playbook, and how to incorporate these initiatives into your digital mix, writes Amber Sweeney, VP, customer solutions, Pepperjam.
As brands, both D2C and traditional brick and mortar, look to absorb and eventually recover from the impact of COVID-19, it is clear that part of the work will be reconciling that this is probably the first phase of a longer journey. It is time to get operational for the ongoing reality. To start, affiliate marketers should not presume longevity — whether it be the firmness of the landscape itself or the fruit and outcomes of any given partnership. Over-reliance on any one thing – channel, media type, partner, what have you — has always been risky. But it has proven especially hazardous to one’s business in recent months. Diversification is key to effective operations.
Take one painfully obvious example as an object lesson on diversification. As this all began, massive ecommerce platforms such as Amazon, completely altered the outlook for content partners and influencers by suddenly slashing commission rates within their popular associate programs across any number of verticals. Abrupt lessons like these surely will continue. So, as the pandemic continues to shape our landscape and influence the commerce dynamic, how should affiliate marketers plan to navigate the landscape? How should they approach partnerships and affiliate models, as we head into what is typically the highest revenue-generating period of the year?
One of the most fascinating shifts over the duration of the “at home” state, is consumers’ traffic and transactional behavior that we can observe across any given vertical. While this should always have been primary to our strategies and planning, there is no denying that it is, in fact, a bit more interesting and telling now.
As an illustration of what we have observed at the beginning of the pandemic, where uncertainty dominated our collective mindset, affiliate traffic saw huge spikes year over year, but at the expense of conversion rates. Despite that, the conversion rate still grew YoY, just not at the same pace as click activity. Nevertheless, CVR growth prevailed, peaking in early May at 107% YoY, nearly achieving Black Friday levels. In the week ending 9th May 2020, the conversion rate on Pepperjam’s Ascend platform was 5.8%, while the week ending 28th November 2020 reached 6.3%.
Ecommerce sales for the home vertical have been favorable, likely due in part to consumers opting to outfit their homes as they were confined as a result of stay-at-home orders beginning in March. From an affiliate marketing perspective, while some verticals fared better than others initially, on year to date (YTD) basis, all verticals are up YoY except travel. Ironically, gifts and flowers have fared best, achieving 170% revenue growth, closely followed by Food and Drink at 168%. Both were likely due in part to the shift in consumer purchase behavior, obviously more adept and comfortable now with online as a channel for these goods and services. Knowing all this more granular data assists an even more mindful approach for B2C and D2C marketers, certainly.
From my perspective, working with some of our most nimble and adaptive marketers, on top of keeping the buyer’s control of their own journey, as a guide, methodically thinking through the following areas will help any affiliate marketer operationalize for the new reality.
Diversification of Partnership “Types”
Sounds clever, right? So, how does an affiliate marketing team reset this bit of groundwork so that they have the right mix of partnership types in their program? First, you need to understand your current publisher and revenue composition and how this aligns with your target demographics and your undoubtedly shifting goals. Ask yourself: does your current publisher mix enable you to be present where your customer is – at the top, mid and bottom of the funnel? Is your revenue mix concentrated with one publisher type or a few publishers? Comparable to planning your own financial portfolio, knowing these answers will help build the framework that you need to better diversify your program. This essentially sets the groundwork to define where you are over and under concentrated to help you focus your diversification efforts going forward.
Understanding and Leveraging the New Data Available
Assuming you have robust systems in place for running and optimizing your affiliate programs, now is the time to go deeper with the data likely already available to you. Ideally, you have transparency into data points such as repeat purchase patterns and yield volume over time – all of which will help you understand your most productive partnership types (and of course specific partners) and tune your programs to build on positive outcomes over time.
Once You Have Committed, It Is Time To Meaningfully Monetize Each Partnership Type for the Long Haul
While it is true that you cannot presume longevity, there are certain things you can do to nurture longevity. As you establish the right mix, leverage your very own data more thoughtfully, and to some extent follow the money, it is essential to remember that at the heart of all this is one thing – the relationship.
It is worth noting at this point too that within affiliate marketing, brand safety should be a prevailing focus. There are no shortcuts or workarounds. You are giving third parties the ability to represent your brand through their own marketing and advertising tactics. From paid search to on-site advertising, the tactics run the gamut. This means you do not want a partner positioning their own paid search ads as your own, and there should be a clear distinction between where the consumer lands, their site versus yours. Nor do you want on-site ads misrepresenting your brand, the details of a promotional offer, and so on. Therefore, you must ensure compliance in how they represent, position, and promote your brand. The effort to counter the potentially black hat and keep the brand safe is “always on.”
Learn More: The State of Affiliate Marketing in 2020
Relationship marketing is a component of affiliate marketing. So, be sure to keep communications open with your partners, sharing both short- and long-term goals, instead of only focusing on product and promotional messaging. This will build a productive business relationship and provide a more mutually informed dialogue for optimization opportunities in the future. Staying nimble and flexible during this time will allow you to pivot with shifting consumer behavior and be in a position to make smart data-driven decisions based on a long-term view — avoiding those snap decisions that neglect overall channel and business goals. With such a sound operating mindset, you can continue to invest in the partnerships that are adding value to your affiliate program and make sure you have the advanced tools and analytics to optimize with them. This will allow you to fully optimize campaigns and gain a deeper level of understanding of how you can replicate on the success.
This article originally appeared on Toolbox Marketing. Visit here to learn more.