What is affiliate marketing?

Affiliate marketing is a type of marketing where merchants (also referred to as advertisers in the world of affiliate marketing) reward affiliates (also referred to as publishers) for each customer they bring to the business through their own marketing efforts. The business provides the affiliate with a unique affiliate link or code that the affiliate can use in their own marketing. When a customer clicks on the affiliate link or uses the affiliate code to make a purchase, the affiliate (publisher) earns a commission from the sale.Including those mentioned above, here’s a list of the major players and a little more detail of how affiliate marketing works:

The advertiser: Commonly referred to as ‘the advertiser’ within the affiliate channel, this is the brand or merchant seeking additional web traffic and revenue sources.

The agency: Agencies work on behalf of ‘the advertiser’ to run their affiliate channel. Although this is not uncommon, most advertisers manage the channel themselves without an agency.

The affiliate network: Works closely with ‘the advertiser’ brand to identify suitable publishers for converting more sales.

The publisher: Also known as the affiliate, ‘the publisher’ is responsible for promoting advertisers’ products to their audience in return for a portion of the final sale price.

The consumer: The online shopper who purchases ‘the advertiser’s’ products through the tracking links provided by ‘the publisher’.

Now we know all the main players involved, here are four of affiliate marketing’s main benefits:

1. Increased sales and revenue

Affiliate marketing can significantly increase sales and revenue for businesses. By leveraging the network of affiliates through companies like us here at Webgains, businesses can reach a wider audience and target customers who may not have been reached through traditional marketing channels.

2. Cost-effective

Affiliate marketing is a cost-effective marketing strategy because businesses only pay affiliates when a sale is made. This means that businesses do not have to spend money on advertising or marketing campaigns that may not result in a sale, and they don’t require large up front costs to set up either.

3. Access to new customers

Affiliate marketing can help businesses reach new customers. Affiliates typically have their own audience or customer base, which means that businesses can tap into this network to reach this pool of engaged new customers.

4. Performance-based

Affiliate marketing is a performance-based marketing strategy. This means that businesses only pay affiliates and their network when a sale is made or a specific action is taken, such as filling out a form or subscribing to a newsletter.

The Swiss Army Knife analogy:

We are often in amazement at some of the brilliant concepts that are pitched to us as a network. They standout due to that fact that they are able to not only fix a problem but also drive significant commercial growth, sometimes just on a Cost-Per-Acquisition (CPA) model.

Webgains’ responsibility to our clients doesn’t just sit solely through affiliates; we need to understand the overall business function. Sometimes the affiliate channel provides a solution with less internal red tape whilst on a paid-on performance metric.

Much like the revered Swiss Army Knife, affiliate marketing is a channel with many solutions for issues that our clients face on a regular basis. Using examples of high-performing publishers operating within our affiliate network, here are five we really like at the moment:  

1. Unleakable codes for every brand

There are more and more closed group offerings from employee benefits through to student discounts but a one size fits all code really doesn’t provide a closed group offering. This isn’t down to strategy but more lack of capacity or capability and it’s where an affiliate such as Uniqodo comes to fruition.

The fact that an affiliate – like Uniqodo can create thousands of unique codes to prevent leakage to your brand just for a small piece of JavaScript to be added to your site solves such a big problem and gives you the access to not just other affiliate codes but all other digital and offline channels.

2. Target anyone – affiliate has exceptional reach

We can now go into client meetings and ask our contacts, ‘what customer demographic do you want to optimise with? Feel free to challenge us!’ and the likes of Gocertify will go to the drawing board and provide creative options. Students and key workers have been done and they still duly deliver but which other groups can we support too?

Last year we launched our Maternity Leave Discount as a network exclusive for our brands. This is a must in the current economic state but there’s so much more on offer; from cinema tickets with exclusive voucher does for specific films, to discounts on luggage for airline staff; these innovative and creative solutions fill me with excitement!

3. Smarter connections at checkout

Providing a customer with an added-on site incentive to help convert the purchase or upsell additional items is a great way to gamify without having to discount from the basket. However, if a brand’s lowest priced item is £100, this isn’t necessarily achievable. 

Tyviso’s gift with purchase affinity partnership fixes this problem. This affiliate is able to integrate with a merchant’s onsite basket and provide a relatable gift based on meeting basket requirements. One example is a related magazine with purchase over a certain value.

4. Content with minimal risk

Content is the golden ticket. SEO-rich articles can drive high quality traffic to your site and leave you wanting more. But the issue is that more sometimes comes at a price. A price that can be way off in terms of affordability and there’s always a risk that it won’t pay dividends. Our brand point of contacts are predominantly not solely allocated to affiliate but oversee all paid marketing channels, so justifying tenancy for content is tough to sign off.

Enter Linkby.

Linkby speaks the language to well-rounded performance marketers by providing content with premium publishers on a Cost-Per-Click basis (CPC). The brand pitches the campaign and the proposals come in with the outlined CPC but capped at a minimum of £2,500 per article. Linkby are the much-needed bridge to the rest of the chocolate factory, avoiding the mysterious boat to who knows where…

5. Abandon abandonment

Finally, we work with many clients that are resellers situated in a very competitive environment. Ensuring conversion on site is a must for the brand and spotting signs of abandonment is key. This is where Intent.ly provides multiple solutions that prevent basket abandonment through overlays.

One in particular is where the customer has the intent to search for the product elsewhere and copies either the product name or SKU. This is where an overlay will pop up either offering a discount code or best price guarantee ensuring that the product is purchased through the site.

Why invest the hard work in driving the user on site if the customer is going to purchase elsewhere, further proving the value of the channel whilst utilising a soft-cookie set up?