What is affiliate marketing for ecommerce brands?

Affiliate marketing provides brands a unique opportunity to increase their reach across all stages of the marketing funnel. However, for many brands it is still a complex world with many affiliate programmes being left to run unoptimised or not launched due to a misunderstanding of what opportunities the channel actually offers for growth. 

This getting started guide provides an introduction to the channel and the key things to consider when launching, optimising and wanting to grow your affiliate activity.  

What is affiliate marketing?

Affiliate marketing is working with a diverse network of relevant partner sites to drive traffic and conversions to your website. Affiliates typically work on a Cost Per Acquisition (CPA) model, so you only pay a commission to partners who go on to generate a sale. 

A healthy affiliate programme should grow over time to make up around 15% to 20% of your online sales (this can vary by sector and maturity).

The key reasons brands do affiliate marketing are:

• Increased reach - working with a network of partner sites enables you to engage with their users and databases. These sites are often high ranking sites with their own engaged customers and have onsite marketing tools you can leverage.
• Diversity of exposure - the affiliate channel cover all stages of the marketing funnel within one channel. From the brand awareness driven by influencers to converting sales via voucher code sites with targeted offers.
• Efficiency - the channel is predominantly built around a CPA model, however this is changing to be more around hybrid style payments, despite this ROI is still a strong KPI for the channel. Once up and running it often presents a low risk opportunity to generate conversions.
• Leveraging what works - as all activity is tracked via an affiliate network platform it is easy to see what partners are driving traffic and sales. Having this level of insight enables you to invest more in partners that are working. You can pay fixed fee style payments to boost your presence - for example newsletter inclusion. The results and ROI of this exposure can easily be attributed back via the tracking.

Why should you add affiliate marketing to your digital channel mix?

Affiliate marketing provides a unique opportunity to engage with multiple partners and high volume sites in one place. As a brand it can be challenging to find relevant affiliates, negotiate with them, arrange bespoke commercials and develop lots of partnerships at scale. The affiliate channel enables this as you have instant access to a network of sites ready to promote you for a commission payment. 

Affiliate marketing encompasses lots of promotional mechanisms in one place. The sites you engage with are all doing their own marketing, having their own SEO strategies and building their own databases. As a brand, you stand to gain by partnering with these growing sites, as it gives you access to an existing customer base of users. A lot of large affiliate sites in the UK are brands in their own right and provide reach to a customer base often bigger than the brand themselves has. For example Topcashback has 14+ million members in the UK.

There have been a lot of changes in the industry to make affiliate marketing more accessible via the major affiliate networks - through tracking set up and the associated commercials. There’s never been a better time to utilise the affiliate channel than today! 

Need a bit more?

If you would like to know more about affiliate marketing for ecommerce brands, we've put together the Best Beginners Guide to Affiliate Marketing here or please do reach out to us at hello@geniegoals.co.uk

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