Affiliate marketing is premised on interpreting how emerging technology can address consumer needs. For retailers this presents a challenge; knowing which technology to back that delivers both customer engagement as well as sales can often require a leap of faith with all the associated risks.
One of the inherent safety nets of the affiliate channel however is how it insulate brands; the central premise of payment on performance offers a space to try out new propositions that may not work with much of the risk to the company time spent invested in trialling the tech rather than financial exposure.
But with the emergence of influencer marketing, for many in the industry a rebadging of the longtail, content basis of most affiliate programmes, how is this new kid on the block demonstrating it offers brands assurances on their return on investment? Does the affiliate channel have a role to play in sharing the industry’s well-established metrics that brands are increasingly demanding from the wider digital spend?
The rocketing price of influencers
The whole concept of influencer marketing makes some wince but, love it or hate it, there is no doubt it features on many marketers’ to-do lists. And accompanying that attention have been some increasingly dizzying budgets waiting to be spent.
A recent survey conducted by Morar Consulting found certain online ‘celeb-influencers’ can charge, on average, £75k for a Facebook post. They are defined by their reach, in this case influencers with more than one million followers on any major social platform. Even ‘micro-influencers’, those who can tap into a following of around 10,000, can still demand on average £1,500 for recommending a retailer’s products and services.
A bubble waiting to burst?
Leaving aside the regulatory minefield that comes with such endorsements, when these are scaled they demonstrate an industry that is riding the crest of a wave, but could the whole industry come crashing down as quickly as it’s risen? As an article on Nichehunt recently observed, it’s a “young industry in a state of exponential growth (with) no standard rates or rules. It’s the Wild West of marketing”.
In an age where half of the largest multi-nationals, according to the World Federation of Advertisers, consider transparency the most important issue around media governance, measurement of influencer budgets won’t be a nice to have, it will become a necessity.
And this is where affiliate marketers need to position themselves. We’ve already won the debate on the commercial model we offer; now let’s fight for our share of the influencer pot of cash and do it on terms.
“As influencer marketing evolves, standard KPIs that brands are using to measure return on investment have emerged,” says Brandon Brown, CEO of Grin, an influencer marketing platform.
The metrics aren't rocket science
If any of them want guidance on what they should be measuring and how, then speak to any seasoned affiliate marketing practitioner. It’s affiliate 101.
As standard an affiliate network will track impressions, clicks and sales on a per partner basis. Click through rates and conversions are simple calculations. These ‘harder’ actions are a network’s bread and butter but without doubt where the industry could improve, and take a leaf from an influencer network’s book, is the facilitation of both softer and value based measurements.
Historically affiliates have been reluctant to share demographic data about who their user bases represent. Traffic sources, device splits and promotional opportunities can be multifaceted for individual affiliates. Layering these data points with quantifiable outcomes such as sales and revenue makes for a powerful and compelling proposition.
Additionally brands can pass back information such as customer ID and products purchased in every sale which means lifetime value can be monitored as well as how that customer’s buying behaviour changes over time.
In ecommerce this post-transactional data is vital in providing proper analysis of what big cash endorsements are driving. That affiliate marketing hasn’t captured more of the influencer budget possibly shows what a poor job we’ve done in telling our own story and adapting to changing client needs.
That isn’t to say some aren’t seeing the channel as a perfect testing environment for trialling influencer campaigns.
The brands embracing influencer within the channel
One major protein reseller, for example, has created an army of brand ambassadors who receive free products and commission rates that reflect their value. The brand has also aligned with its social media team to ensure their affiliates receive bespoke content, tailored and personalised messaging and unique voucher codes.
The 150 strong team of brand ambassadors now account for more than 40% of the programme’s sales. The brand has embraced influencer marketing in the channel, recognising that investment in building a robust solution, rather than tinkering around at the edges, can pay dividends.
Probably the most high profile affiliate programme, the Amazon Associates platform, soft-launched an invite only, influencer network in the first half of this year. While information about it remains scarce it appears it is still focused on strong return on investment metrics. If so, this is a boost to affiliate marketers as it demonstrates influencer marketing’s longevity will probably be premised on it being highly accountable. Additionally perhaps Amazon’s move is reflective of their desire to grab a greater share of the clothing market. To date there’s no doubt fast fashion has grabbed the influencer headlines.
Another Awin advertiser in this sector has recognised the importance of appealing to its target demographic at a formative age and has used its clout to recruit brand supporters at university, each tapping into their respective social media networks.
Formative campaigns are now starting to bear fruit. They are imaginative and compelling and networks have a duty to tell the stories. Only by doing so will we cement affiliates’ place at the heart of influencer marketing and help shape the future of how campaigns are delivered and measured.