It’s time for the next “real talk” within affiliate marketing

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Frankly, my enthusiasm for partnering and affiliate marketing didn’t start high by any standard of measurement. It’s not something I’m hiding. I have agreed to lead the turnaround of a relatively large distressed company in the category. It was not an easy “yes” to the private equity sponsors. It involved a lot of diligence.

I haven’t lost sight that this is a category that for years has been constrained by its own now well-known bad behaviors, including PPC and SEO. manipulation, opaque arbitrage, click stuffing, measuring your own homework, and a self-rewarding game of last-click diversions. It wasn’t particularly shocking that CEOs and CMOs still handed over their most important partnerships to their business development teams rather than their affiliate teams. Nor was it particularly shocking to consistently find that more than 60% of a program’s revenue was allocated to fewer than five partners. Not exactly a recipe for growth.

Make no mistake, collectively we have made real progress over the past few years. New stories have been written and technological innovation has enabled partner diversification, fair attribution and, with it, new opportunities. New capital has flowed into category businesses, and with it skepticism has given way to optimism and clear progress on the path to genuine enthusiasm from those whose legitimacy we seek (otherwise known as significant increases in category spending).

My colleague Michael Jacobi, CEO of Button, recently referenced the ongoing effort to expand the potential affiliate and partnership marketing market with a powerful call identifying a potential path for “affiliates to escape the enterprise value smurfdom they faced. Our channel (yes, it’s a channel) has finally started to take ownership of the removal of self-imposed obstacles to mainstream legitimacy and thereby opening up a much larger addressable market. This is because the strategies (diversification of partners), methodologies (multi-touch attribution and dynamic provisioning) and underlying technologies (automation and open APIs) found in platforms like ours have grown and provide verifiable evidence of the integral role we play in driving successful business results and profitable growth for marketers, partners and creators.

Go to the next step and change the conversation

It’s a good start, but it’s only a start. To fight this fight, we must get our hands on it and refuse to settle, in order to move the industry further away from the status quo in favor of a better path for all parties involved. No CEO or CMO should ever have to question their ability to trust the affiliate channel with their most important partnerships, and there’s still a long way to go before they get there.

To say that the key to overcoming the shortcomings is to get the CEO and CMO on board seems a bit simplistic. But if we, as a dedicated and evolving ecosystem, lean towards innovation in all areas, even slightly lacking, the cumulative effect of our active enthusiasm and pursuit of change is great. The key will be to make sure we’re all talking about the same script.

Yes, we all wish we had a crystal ball to envision the future five years from now. But it’s safe to say that during this time there will be core themes that we will see resolved, as those of us who participated are determined to move forward. I believe, first and foremost, that the legacy network model will continue to fade as it has in every other paid channel. If you think about programmatic display, it has gone from a network model to a programmatic model. It took years for that to happen. And broader network models eventually gave way to programmatic providers, both on the demand side and the supply side. According to eMarketer, nine out of 10 digital ad dollars will be transacted programmatically in 2022.

In order to move the category forward, the onus is on innovation to really move the channel beyond its last-click history from an attribution perspective. This has happened as we collectively raise the bar on measurement and attribution. Essentially, we must be willing to enable measurement of our channel’s contribution with the standardized toolsets and methodologies deployed across major channels. So that’s what we’ll see: more innovation, more disruption, more abandonment of legacy models, and the continued fuel that will come based on the needs of brands and partners for this category to increase its contribution over time. time.

The next area of ​​innovation needed is as much a matter of imagination as anything: ensuring that we and our customers reimagine the types of partners to drive business results. Historically, in a last-click channel, an affiliate was generally considered a cashback site or coupon provider. Then there were the mass media publishers, accessed through an aggregator or subnet model (the result of the primary owner of the inventory devaluing the channel and giving it to someone else to monetize it in his name). And now we’re seeing quite a significant expansion of the affiliate definition to include influencers and even what we might call a PR performance model.

Non-traditional partners who may not have been considered relevant to the Affiliate and Partner channel previously are now able to step in. Brand-to-brand partnerships have become much more prominent in our discussion track, driven in large part by the recognition that the next generation of consumers buy on the basis of trust and that matching complementary brand proprietary datasets is a powerful remedy for the loss of targeting resulting from ITP and the depreciation of the third-party cookie. Look no further than the recent growth in ad network spending in retail media, as consumer goods manufacturers use search and display ads to reach target customers during their buying journey. .

The automation that underpins channel growth and enables non-traditional partnerships by simplifying administration is a big part of that. The historic manual nature of the chain – often romanticized with references to “it’s a relational chain”, without acknowledging that the ramification of a purely human dynamic is a complete lack of access to a diverse scale – is a dynamic that is growing down a way. This bodes well for continued growth, but we’re still in the early innings.

Together, we must continue to move forward and strive to change the narrative around affiliate and partnership marketing.

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