Put affiliation at the heart of your e-commerce strategy in 2021

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Affiliation is one of the many digital marketing levers available for brands and retailers. For some, it has become one of their main sales channels. 

Jeff Bezos, the founder and CEO of Amazon, was at the forefront of this marketing technique. Rumor has it that during a party, he was chatting to a woman who wanted to sell books on her website. However, she didn’t want to take on the burden of becoming a retailer as she felt daunted by the logistics, customer service, and accounting that would be involved. Jeff Bezos pondered a solution enabling the woman to sell books to her website’s visitors and earn money from each sale, without needing to take on the complete responsibility of the actual transaction. 

This was in 1996 and marked the beginning of affiliation. The first affiliate program “Amazon Associates Program” was born. Since then, this system has expanded outside Amazon and has proved itself to be highly successful. 

Affiliation, or “performance marketing“, is a web marketing sales model where publishers (also known as affiliates) and advertisers (online merchants) come together as a partnership. The idea is that online retailers want to sell their products or services, so they will pay affiliates if they bring them sales or leads. The commission system is nothing new: a business provider connects buyers and sellers. With this one, everything happens online. Remuneration is mostly on a CPA (cost per action), CPL (cost per lead), or CPC (cost per click) basis, and is always based on performance.

In fact, this model can be applied to multiple acquisition levers: price comparison sites, promo code sites, cashback, retargeting, display, email marketing, native ads, and also influencer marketing in recent years. Thanks to affiliation, all of the marketing channels are open to you, without too much financial risk.

However, managing multiple affiliates can be time-consuming and tedious for online retailers. This is where affiliate marketing platforms come in. An affiliate marketing platform is a space where advertisers and affiliates meet. The platform will take care of all your online campaigns, set you up with new affiliates and then manage the day-to-day contact with them. Some of the best-known platforms include ShareASale, Awin, Amazon Associates, Shopify, eBay Partners, etc.

Why should I take the plunge?

  • Whether you are a brand or an online merchant, B2C or B2B, a large account or an SME, this is a model that can work for you, whatever your sector: retail, banking, insurance, tourism, etc. 
  • As the commission is performance-based, there is little risk involved on your side and your ROI is completely under control.
  • Reach a new audience and attract new customers: by using affiliates you can increase your reach and boost the visibility of your products, which can sometimes mean reaching a target audience you otherwise would not have reached. 
  • Go global: are you interested in branching out into new markets? Affiliate marketing platforms have often established an international network of affiliates and will allow you to advertise your products internationally, without much investment on your side. 

Key points

  • Managing a network of affiliates can be long and tedious. Using an affiliate marketing platform is a great solution, but in exchange includes commission, to be taken into consideration in addition to that of the affiliates.
    For example, if you make €100 in sales through affiliates managed by an affiliate marketing platform (these amounts are shown solely as an example and will vary depending on the affiliates and the affiliate marketing platform):
    – You will pay a 10% commission on this sale to the affiliates -> 10€.
    – AND 30% commission on this amount to the platform -> €3

    So, in total, you will pay €13 from the amount that your sale generated.

  • Stay in control of your image and what is being published, live or via the platform: make sure you keep an eye on what content is being published and on which channel.
  • One of the key points to remember, which will ensure the smooth running of this partnership is sales allocation. If your products are available across multiple channels and multiple affiliates when a sale is made who should it be attributed to? 
  • The choice of allocation is done using the tracking present in your URLs and a tag placed on the page of your site where the order confirmation (or form) is, in order to be able to track the conversions. An affiliate marketing platform can help you set up an appropriate allocation system.

Optimized affiliation with Lengow

As with any campaign that is distributed via different levers, a complete and up-to-date product feed is the key to success.
An affiliate marketing platform can be a great helping hand, but it will never be able to replace a feed platform, especially for certain types of affiliates like Criteo which require specific attributes and an optimized feed structure.
Using a feed manager also allows you to ensure that your data is up-to-date and your feed is stable. This is essential for guaranteeing an optimal distribution of your products.

It’s up to you to create your product feed using a platform like Lengow, and then the affiliate marketing platform can take over to manage your tracking and distribution via the affiliates of your choice.

> Affiliate marketing platforms and feed managers work hand in hand to make your affiliate campaigns a success.

If your product catalog contains many types of products, you will most likely want to send each affiliate a limited number of references, e.g. each one corresponding to a range of products. Lengow makes this possible by segmenting your product catalog. You can also exclude selected products from being published based on category, product type, brands, or even certain articles. In the fashion industry, for example, you can choose not to sell certain luxury brands through a particular affiliate if it does not meet the target audience.

You can adapt to each distributor’s or affiliates’ requirements and match the attributes of your catalog with those requested by the partners. Lengow provides smart category suggestions so that you can quickly match the categories requested by affiliates with categories in your own catalog. The My Custom Channel feature allows you to add a new field directly to your catalog structure so that you can meet partner requirements.

> This allows you to have more autonomy and flexibility when configuring your feeds and send additional information to affiliates.

Tracking your URLs is also important when it comes to working with multiple channels. This is even more so in 2021 as cross-device tracking and the reinforcement of Apple’s Privacy Policy measures (IOS 14) are causing tracking issues to become more complex. 

As mentioned previously, tracking will allow you to analyze the performances of each URL, and to boost or limit the distribution, according to precise results. Thanks to feed management platforms like Lengow, you can define rules to automatically add the UTMs of your choice to your product URLs that will be sent to your affiliates.

The Lengow connector for Google Analytics enables you to retrieve statistical data from your e-commerce site and then link it to your product catalog. You can therefore optimize costs by only distributing your most profitable products. For example, by using the predefined Segments, you can test part of your catalog before fully launching it on a new affiliate (e.g. 100 products with the highest revenue over the last 7 days).

Over to you!

Demande de contact EN

Naomi Botting

Communications Manager - UK/NORDICS