How to Execute Affiliate Marketing in a Profitable Way

When looking at how to execute affiliate marketing in a profitable way, it’s important to look at how the best affiliate marketing programs integrate affiliate marketing into their overall marketing strategy. The best-in-class advertisers makes sure that their affiliate marketing strategy is designed to drive incremental traffic to their program, instead of stealing traffic from their other paid and unpaid marketing channels.  It seems obvious, but unfortunately, that’s not how it’s always done.

Affiliate marketing supports your other channels, just as your other channels support affiliate marketing.  When thinking about the old (but still true) Marketing Rule of 7, it becomes even more clear on how affiliate marketing supports your overall strategy in a profitable way. Some argue that due to the constant bombardment of advertising these days, the Marketing Rule of 7, is really the Marketing Rule of 12, because it now takes about 12 times for a person to be exposed to your brand before making a purchase.  That amount of exposure can get expensive really quickly, which is why affiliate marketing is such a great way to keep your costs down and your profitability up. 

Affiliate marketing allows you to reach your targeted customer base and only pay when a sale is actually made.  The great thing is that it supports your overall marketing efforts, which ultimately lowers the effective Cost Per Sale across the board.  If a targeted customer needs to be exposed to your brand 7-12 times, it makes sense to try to get a least half of those exposures from your affiliate channel and the other half from your other marketing channels like SEO, Paid Search, PR, Facebook ads, and Instagram.  Affiliate marketing can drive traffic, brand exposure and sales from blogs, social sites, loyalty sites, deal sites, mobile apps, display, search, and many more channels on a Cost Per Sale basis.  That makes affiliate marketing a very cost effective branding and sales strategy.  In addition, affiliate marketing drives extremely measurable sales while lowering your risk in many channels that typically pay on a CPC or CPM.

Once you realize that affiliate is a very cost-effective channel, it’s time to think how to execute affiliate marketing and make it profitable.  There are many affiliate marketing publishers that will take advantage of your non-affiliate marketing efforts and try to claim last-click attribution for themselves.  Without experience, many people won’t know who these advertisers are and how to stop them. Here are a couple ways publishers can steal traffic from your other paid and unpaid media channels.

1. Trademark Plus Bidding
Trademark Plus Bidding is when a publisher bids on an advertiser's brand name plus another word. An example would be "Blue Apron Coupons" or "Blue Apron Promo Codes".  What happens when a publisher bids on your "trademark plus" terms is that they can cause your internal Paid Search costs to increase. In addition, they could also steal traffic from your organic search. Lastly, when a customer does click on these publisher's websites from a paid search result, the customers are often distracted because they aren't sent directly to your site. On the publisher's site, they often distracted by offers from other competitors and expired coupons, which ultimately lowers your conversion rate. 

2. Affiliate Toolbar Traffic
Toolbars and extensions are added to a browser and fire a pixel anytime a customer reaches a certain website. For example, if I have a toolbar installed on my browser and type in the url "www.finishline.com", the toolbar would activate and fire a pixel. That would allow the toolbar publisher to claim credit for the sale and get paid on it, even though the credit should be given to organic traffic since I manually typed in the url.  There are some publishers where 95% of their traffic is coming from a toolbar or extension.  We don't recommend working with publishers like this because these publishers are not driving incremental traffic.  Instead, they are stealing traffic from your other marketing channels.

If you're not already familiar with publishers who mainly send traffic from toolbars, its easy to be fooled.  These publishers often hide that they drive traffic through toolbars or extensions in lengthy T&Cs or mask themselves as a deal site.  That's why its really important to have an extensive publisher vetting process as well as decades of experience to already know who these publishers are.  

It's also important to monitor Trademark Plus Bidding 24/7. There are many tools available to do this for you.  Without using a tool to monitor Trademark Plus Bidding, publishers can implement tricks to not get caught, like excluding your headquarter's zip code or city from showing search ads.  Brand monitoring tools always ensure your brand and profitability is protected.

Affiliate marketing is an exciting and cost-effective way to drive traffic and sales to your website.  It is important to remember that when you structure an affiliate program, it needs to be developed in a way that supports your other marketing channels, brings incremental sales, and drives your overall profitability.