Measuring the success of affiliate marketing
Affiliate marketing promises much, but how do you know if its working or not? This, as with all marketing for online business, is crucial and you must stay on top of it if your campaigns are to be a success.
To help you do this there are some key things you can do when setting up and running your campaign – there are also software tools that can help you manage all your different affiliate partnerships, but we will come to those anon.
So, what can you do to keep tabs on how effective your affiliate marketing programme is?
Get the KPIs right
Before you start with any sort of affiliate marketing campaign or initiative, its important to establish what it is you are trying to achieve. Knowing what you are actually trying to get out of it means that you can draw up some key performance indicators (KPIs) that you can use to measure how well or not any partnerships are going.
The most commonly adopted KPIs for affiliate marketing are:
- Conversion rate
- Cost per acquisition (CPA)
- Return on ad spend (ROAS).
While your affiliate marketing KPIs don’t need to be revenue or cost-based, they should be measurable so you can easily identify what’s working, what’s not, and adjust your strategy accordingly. Some examples of non-revenue or cost-based KPIs include:
- New traffic (first-time visitors), generation
- Social engagement (likes, shares, comments)
- Purchase intent (store locator, shopping basket activity).
Use the right tools
There are some excellent third-party solutions available that can help you manage all your different affiliate partnerships by tracking clicks, referrals, commission, payments and so on.
You could chose either to install your own affiliate marketing software, for example:
- OmniStar OSI Affiliate
- Post Affiliate ProPost Affiliate Pro
Alternatively you could decide to become part of an established affiliate network like:
- Affiliate Window
- Rakuten LinkShare
Whichever route you decide to go down, your shopping cart software should be able to integrate the tracking script from your chosen third-party affiliate software onto your order complete web page.
For example, with ShopIntegrator, you can easily paste the tracking script from your affiliate marketing software into the order completed web page, enabling you to identify the customers that arrived on your website from an affiliate / partner site, then went on to make a purchase from your site.
The order value is then automatically fed back into your affiliate marketing software and each of your affiliates can be assigned their commission accordingly.
The process becomes automated freeing up your time to better manage the relationship you have with your affiliates, rather than being bogged down by administration.
Watch for trends
Traditionally in affiliate marketing, the sale is credited to the last click prior to a conversion. The affiliate partner responsible for driving a user to an advertiser’s website receives a commission for the purchase.
But affiliates aren’t always the “closer” in the consumer conversion funnel – they can also be an “opener” or “advancer” within that process, creating awareness for a product or service and initiating purchase intent.
Advanced attribution enables you to track, measure and report against your affiliate marketing campaigns, as well as all the marketing touches that contributed to a conversion, such as organic search and direct visits to your website.
By monitoring algorithmically attributed performance metrics via a marketing dashboard or through timely performance reporting, you can view and analyse the effectiveness of all your affiliate partners based on their true contribution to a conversion.
To achieve the best possible results, affiliate partner performance should be monitored and evaluated regularly. To set your team up for success, consider creating monthly or quarterly targets associated with the KPIs you identified above.
Setting targets not only helps your affiliate marketing team become more goal-oriented, but also enables you to uncover patterns in partner performance, identify problem areas, and take corrective action if required.
In addition to accurate and on-going measurement, programme optimization is critical to maximising your affiliate marketing effectiveness. Since marketers typically have little control over the quantity and quality of incoming traffic from affiliates, identifying the “right” affiliate partners is crucial.
A key benefit of attribution is that it not only enables you to determine your ideal portfolio of affiliate partnerships, but also to identify which creative messages and offers are producing the most conversions.