Marketing channel

Affiliate should never have been a marketing channel

30 second summary:

  • When the affiliate channel burst onto the scene in the late 90s, it was categorized as a type of marketing.
  • But in reality, affiliate marketing has nothing to do with most marketing channels – it’s more about relationships than keywords.
  • We need to change our mindset from “affiliate is a type of marketing” to “affiliate is a type of partnership” – and partnerships should have a seat at the CEO’s table, not the CMO’s.
  • When companies adopt the right mindset and strong partnership automation technology, partnerships can drive an average of 28% of overall company revenue.

What were we thinking? Since the beginning of the channel, we have cursed our affiliate programs with the label “marketing”.

We’ve always thought of it as affiliate marketing run by affiliate marketers, basically an alternate version of paid media where other people, companies, or websites advertise your products based on performance.

The problem is that our affiliates (those people, companies, and websites) aren’t like paid media at all. Where we went wrong was thinking that you could just turn on that channel the same way you could flip a switch and get traffic from paid search.

Affiliates are autonomous, not algorithms, and working with them requires honing a relationship, not a spreadsheet. So by relegating our affiliates to the marketing department, we got it wrong.

Flex your biz developer

Imagine, for example, that you are looking to hire someone to manage your affiliate program. You receive two resumes. One candidate has extensive experience in digital marketing and the other in business development.

Which are you hiring? Many in the space would choose one with a background in marketing, because…marketing, right?

But if you take a closer look at this resume, you see a set of skills vital for marketing channels like paid search: optimizing bids, reconciling spreadsheets, setting up programmatic display buying, and perhaps writing advertising content for countryside.

Some of these skills may come into play if you’re an affiliate pro, but they’re not what make superstars shine.

Next, check out the business development resume. If it’s good, it’s all about relationship building: discovering, negotiating and nurturing partnerships for growth and profit. Now we are talking about affiliation.

The real affiliate rockstar is the person on the phone all day, pitching the program to potential affiliates, building relationships and brainstorming with existing affiliates.

They network, research potential partners and negotiate contracts. What they don’t do is treat affiliates as a plug-and-play, configurable, forgettable traffic generator.

Instead, they invest time in collaborating with affiliates and turning them into high-value partners.

Like business development, the affiliate channel is all about identifying people and business partners who can successfully promote your business.

It’s about recruiting them, hiring them, and then maintaining and managing the relationship for continued performance growth. And viewing affiliate marketing as a traditional marketing channel has led many down the wrong path, toward mediocrity and away from explosive growth.

It held affiliation back, but it’s not an inherent weakness. Quite the opposite, in fact.

Research over the past two years has confirmed that partnerships of all kinds, including affiliates, have enormous potential to drive growth. The most mature programs contribute an average of 28% of the companies’ overall turnover.

But until we recognize partnerships as a separate growth engine from sales and marketing, we are limiting their potential for growing businesses and, therefore, launching great careers.

Change the mindset and the flowchart

Affiliate has no shortage of qualified people, they are everywhere – internal programs, agencies and networks. But we continue to limit their impact by placing affiliate programs in a marketing bucket.

Even repackaging affiliate marketing as “partnership marketing,” as some have done, doesn’t address the core issue, which is that affiliate should never have been the bailiwick of the CMO in the first place.

Its place is to play in a larger partnership organization under the leadership of a Chief Growth Officer (CGO) or better yet a Chief Partnerships Officer (CPsO) and, given its profit potential, to earshot of the CEO.

While traditional sales and marketing channels have lost much of their influence with consumers who now have unlimited research and reviews at their fingertips, referral partnerships as a growth channel explode.

The same goes for professionals who can tap into a more collaborative, authentic, and relationship-based skill set. Stronger, more authentic affiliate relationships are more akin to partnerships with influencers and brand ambassadors and can drive much more than traffic.

Well done, they create:

  • Increased brand loyalty and retention of successful partners
  • Improved performance across your entire partner network, not just the top ones
  • Increased revenue from a broader portfolio of partners using custom payment models and rewards
  • Better content quality and brand alignment through improved communication

And finally, while affiliate marketing was once considered a wild west of questionable behavior, affiliate partnerships are more likely to earn consumer trust.

If you have relationships with genuine affiliate partners who have already established a relationship of trust with your target demographic, you benefit from the halo.

Simply put, if someone hears about your product from someone they trust, they are already more likely to believe that your product is worth buying. That’s true of influencer marketing, and it’s true of affiliate partnerships.

How to transition to partnership

Whether you’re already running an affiliate partnership program or want to get started, take off your marketing hat.

Here’s what it might look like:

  1. Recruit and/or train your affiliate teams to become partnership gurus, armed with tools and skills for the entire partnership lifecycle, from recruiting to communication
  2. Invest in partnership automation so your people efforts can focus on managing relationships and keeping lines of communication open
  3. Do not exploit potential partners or affiliates; be transparent with data and pay fairly based on value
  4. Remember: keywords don’t have sentiments like partners do, and when you show flexibility, adaptability, transparency, and appreciation for your affiliates (even in a pandemic), you’ll be rewarded with loyalty, creativity, allegiance and results.

No shade at the CMO, but start viewing and working with affiliates as partners in your business rather than inventory, and you will unleash both their full potential and your own full potential as growth engine of your organization.

Matt Moore is Director of Product Marketing at Impactand he’s been working in affiliates and partnerships since 2012. He’s always on the lookout for a good story to tell or a good dog GIF to share.