Three Reasons Why Brands Gave up on Affiliate Marketing and How Data and Analytics Is Bringing Them Back

By: Stephanie Harris, CEO, PartnerCentric, Control Suite

For Chief Marketing Officers, the recovery from the COVID-19 pandemic and the recent global unrest has changed and will alter your customer base and its needs in significant ways. Shifting patterns of consumption, fears wrought by upheaval, and a damaged economy that will take consumers and businesses some time to recover from will make for tough sledding over the next 12 months, or potentially longer.

That’s why the main question a CMO needs to be asking is clear: What do you want to gain in the coming months and years? Precisely defining that objective may seem elementary, but many businesses fail to take the time to do it.

Not considering the changing marketing landscape can be a fatal mistake. Instead, you have to look into where things are heading in a world where there are significant changes to revenues, supply chains, customer desires and the competitive landscape. Those who can be nimble and adapt to those differences will thrive. Those that do not will stagnate and decline. 

If you already have an affiliate marketing program in place, it’s time to look for opportunities that didn’t exist previously. You can’t simply rely on trends like seasonality and methods that have worked before. Instead, now is the time to use data strategically to see whether what you are paying publisher partners brings back a return on investment that aligns with what you value.  

In the past, some bad actors in the affiliate marketing space threatened to give the whole industry a  bad reputation. The good news is that new tools and techniques in data gathering and analytics are cleaning up some of the problems that existed while creating greater transparency and new opportunities for business growth. 

Let’s examine three areas where problems arose and new solutions have emerged.  

1. Low-Value Traffic – Cookie stuffing, spyware, bot traffic/non-human traffic in combination with lack of insights into whether the sale orlead was truly incremental have plagued affiliate marketing in the past. Low value, fraudulent tactics in gathering leads also produced tons of bad data. 

Advancements in technology have helped provide the insights needed toward better decision-making by giving brands transparency into conversion paths. Along the way, there’s been a transformation in what’s driving data. In the past, the top traffic-driving affiliates were mostly coupon and deal sites. In today’s world, there are many more influencers, social media mavens, and bloggers, podcasters and content sites, willing to promote advertisers within the affiliate model (and also being credited for the revenue within this model), diversifying programs and driving high quality traffic.

2. Ad Fraud: A step beyond low-value traffic is out-and-out fraud. Ad fraud is representing online ad impressions, clicks, conversion or data events as legitimate traffic. This has created a giant hole in advertising budgets, as it generates phony data that substitutes false volume for quality. Fortunately, content monitoring has evolved and  block and filtering technology exists to stop bad traffic before it ever reaches a brand’s site, taking a proactive approach to stopping ad fraud. 

3. Tracking Platform Discrepancies – The data provided by the tracking platforms of the past was a closed-loop that didn’t interact with a brand’s internal analytics. That means it only gave one piece of the puzzle. Unlike other marketing channels, affiliate marketing is more challenging because you’re relying on third parties to promote you, but don’t have the level of control that comes with controlling the inventory directly. Now, new advances in data and analytics help lift the veil by allowing brands to look at the true contributions and value of affiliates, showing what’s really happening in a program, allowing marketers to make better-informed decisions on their investments. Access to more data provides transparency which assuages concerns about not having control.

Affiliate Marketing can be a safer, more transparent and positive ROI channel than ever before. No one solution is perfect for every business situation. But there are better paths toward achieving your goals. The key to finding them starts with a realistic look at where you want to be and how to get there.

About the Author

Stephanie Harris is the creator of Control Suite, a technology platform serving the affiliate marketing industry, CEO of PartnerCentric performance marketing agency and a Forbes Council Member.