Interested in launching an affiliate program to support growth in your paid marketing efforts, but having trouble getting buy-in from your boss or leadership team?
You’re not alone. Many marketing decision-makers still don’t “get” affiliate marketing. Fortunately, there are many ways you can prove out the value of affiliate, highlight the key benefits in your pitch and effectively support your recommendation.
First, it’s important to face a hard fact: some people still associate affiliate marketing with low-quality, shady behaviors that plagued the model in its inception (what we call “Gen 1”). Fortunately, times have changed. Today, affiliate is one of the most effective online marketing models that exists – and it’s certainly the strongest in terms of being performance-based. With the right plan and strategy in place, you CAN win over your boss and begin your venture into affiliate marketing.
So let’s get started!
#1 Prove the Value
Conducting a competitive analysis is a strong first step in building a case for an affiliate program. Do your top competitors have an affiliate program? If yes, what is their baseline commission rate? What affiliate network are they on?
Use your competitive analysis to prove out the potential revenue your company is losing out on by not having an affiliate program.
#2 Research Upfront Investment and Resource Requirements
Do some research on what the upfront investment might be and what resources are needed to launch and manage an ongoing affiliate program. Key areas to research and build a plan and strategy around include:
- 3rd party affiliate networks and SaaS platforms. Granted, this part can be confusing. To help clarify some things, we created the Ultimate Guide to the Affiliate Marketing Model. In addition to having many helpful tidbits that can assist you in making your case for implementing affiliate marketing within your company, it also explains some of the differences between affiliate networks and SaaS platforms.At the end of the day, determining the right platform (network or SaaS) is an essential part of your program’s success. So take your time here. Have the nuanced conversations. Gather as much information as you can so that you can come armed and dangerous when you propose solutions to the powers that be.
- What can you pay? Look at your margins and costs associated with running the program and evaluate the baseline commission rate you can offer affiliates and remain profitable.
- Internal resources. First, do you have internal resources to support ongoing management of the affiliate program? If yes, how experienced and knowledgeable are they when it comes to affiliate marketing? Keep in mind that affiliate programs that run on a ‘set it and forget it’ model do not scale. If you’re going to put the time and effort into making a case for why your company should do affiliate marketing, then it’s highly recommended to also take into consideration how resources will be allocated to focus on growing the channel—whether that’s by someone on your team or with the help of an independent affiliate program management agency.
- Industry benchmarks. Use industry benchmarks and data (provided by valid resources) to prove out the revenue opportunity. As an example, an article by eMarketer indicates affiliate marketing accounts for 7.5% of total digital spend among retailers.
- Benefits, benefits, benefits. Zero in on the benefits your company can realize by having an affiliate program; focus on the key areas that may speak to your leadership team. Some key benefits of affiliate marketing include:
It’s cost effective! Affiliate marketing is the only paid digital marketing channel where a company pays only when performance has been proven. Unlike other paid channels, where compensation is based on clicks or where you pay upfront fees for a set amount of traffic or impressions, affiliate marketing gives you the option to pay only when a desired action has taken place. In most cases, this is a sale or lead/sign-up.
Furthermore, with an affiliate program, you have the option of only paying for sales that you deem incremental to your business. As an example, if “driving new to file” is your business strategy, you have the opportunity to set your affiliate program up to only pay a commission on new to file transactions.
You can track progress! Most affiliate programs are hosted on a 3rd party affiliate network or SaaS platform. These technology platforms offer valuable tools and features to support your affiliate marketing efforts.
What’s more is that these networks and platforms can also be leveraged to track performance on high-level strategic partnerships – partnerships that may be managed internally through your PR or Business Development team.
By rolling all partnerships, affiliate and strategic, under one umbrella, you’ll be able to track all aspects of your performance marketing efforts. Some of the features that the platforms provide (besides performance tracking) include: management of operating agreements, payments, tax reporting, creative assets hosting and much more. All of which will help free up bandwidth from your internal resources.
Here at Acceleration Partners, we refer to this as Performance Partnerships®
Brand awareness and new audiences! As content marketing has grown over the past few years, more and more bloggers and influencers are leveraging affiliate marketing to monetize their efforts. Working with bloggers and influencers who participate in affiliate marketing can help drive brand awareness for your business and help you tap into new audiences that may not have otherwise known about you.
Through your affiliate program, you can easily distribute content to your partners about upcoming product launches, promotions and creative assets and encourage them to share with their audiences.
By fully doing your research and presenting a well thought out plan, including the value and benefits affiliate can add to your company’s business, you’re sure to pique the interest of the leadership team and win their buy-in.
Here are a few additional resources to help you make your case for affiliate:
Source: Acceleration Partners