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How to Launch and Build an Affiliate Marketing Program

Learn from Steve Weiss, CEO of MuteSix, and Senior Campaign Manager Josh Henry-Hicks on how to launch and build an affiliate program. Affiliate marketing comes with risks if you aren't doing it right - learn the do's and don'ts from the experts at MuteSix. Once you launch your program correctly, your affiliate channel can drive hundreds of thousands of additional revenue for your brand. Get this channel working for you to hit your Q4 goals out of the park!

Episode Transcript — How to Launch and Build an Affiliate Marketing Program

Speaker 1: You're listening to the Spend 10K a Day podcast brought to you by the performance marketing experts at Mutesix. This is your source for cutting edge insight into the world of online advertising from the team with more Facebook case studies than any other agency on the planet. Here is your host, Steve Weiss.

Steve Weiss: Hello everyone. Welcome back to another episode of Spend 10K a Day podcast. Big news coming out of West La. We're going to be changing the name of our podcast, coming up. I can't give you guys all the details, but I know to all the avid listeners that get excited beyond mystical belief when there's a new podcast episode, for all those Facebook junkies that live in ads manager, can't go to sleep at night until they launch new campaigns. We have something amazing coming at you.

Steve Weiss: A brand new name of this awesome podcast. So, gonna be coming out pretty soon. You'll be hearing about that very shortly. For today's episode, we're going to be talking a little more about a multichannel eCommerce. So there's a lot of ecommerce brands that besides running Facebook, besides running search, besides running podcast ads, besides earning display native, they run this thing called affiliate.

Steve Weiss: The affiliate marketing. I'm sure this is a topic that we discuss a lot. Is how do you launch affiliate without hurting what you're currently doing when scaling it with new customers?

Steve Weiss: Affiliate is one of the more difficult traffic sources to kind of dissect, I'd say. And try and separate from what you're currently doing. If you're already scaling on Facebook, there's a lot of risk to opening up affiliate. And I kind of want this podcast is going to be talking a little more about how do you build an affiliate program and kind of separate it away from what you're currently doing. Have that not hinder you.

Steve Weiss: Josh, welcome aboard buddy. Coming in for-

Josh: Good to be back. Yes, he's back.

Steve Weiss: Yep. So obviously your family, they run a large retailer in Australia, City Beach. They have an affiliate program, right?

Josh: Yeah. Yup.

Steve Weiss: And you know-

Josh: It's quite large.

Steve Weiss: There's lots of affiliates, and one of the biggest things that you really have to watch out for when you launch an affiliate program is to make sure that you're governing or sending a set of rules for your affiliates to follow. Because obviously affiliates, they're opportunistic marketers.

Steve Weiss: They are going to seize the opportunity to drive traffic and conversion at any rate. So if you told the affiliates and just say, "Hey, go generate me traffic." Well, what are they going to do? They're going to bid on your brand keyword terms. They're going to bid against you for all these other popular keyword terms. They're going to dissect where you're doing on display.

Steve Weiss: They're going to be running, building coupon sites and making promises that you know there's so much risk there. So number one, first thing when you launch an affiliate program is set up your governance of rules, whether you're on Pepperjam or Commission Junction or Impact Radius.

Steve Weiss: Whatever platform that you choose. Always remember you need your rules and diving a little deeper into rules. Always be careful about about allowing them to do bid trademark bidding. Recently we found one of the advertisers we work with was allowing their affiliates to bid on their trademarks.

Steve Weiss: Obviously we were sending Facebook traffic, people were seeing the ad on Facebook and all of a sudden looking up that brand name plus this count. Well, unknowingly you know those affiliate, those people are clicking on a coupon link and that coupon link is putting a 30 day session cookie into that person's computer.

Steve Weiss: So now every time we targeted that person on Facebook, this specific advertisers double paying, paying the affiliate and also paying Facebook to generate an acquisition.

Steve Weiss: So it's very important for you to really be thoughtful about number one traffic sources, what they can run, what they can't run. Then number two discount codes. Josh, I'm sure you guys [crosstalk 00:04:05].

Josh: I think discount codes can be extremely messy with affiliates as I'm sure our listeners will be aware. Especially those that are running large scale campaigns. If you can unique codes are very, very important.

Josh: If you can, I'm sure you know most E-commerce brands are running off a modern web platform that can generate mass unique codes. That's very, very important as you grow. And that really restricts the affiliates as to what they can do.

Josh: So, these are your set of codes and they only apply to your specific channels. Also not only that you can set expires and conditions on those unique codes rather than just having say something that's just generic, that can last and live on the internet and beyond.

Steve Weiss: Yeah. And also remember that these codes are going to be a readily available. So what we've seen is that we've seen people, if you have an affiliate program that isn't being managed or operated correctly, you'll see people copying and pasting codes into comments of Facebook ads.

Steve Weiss: So the worst thing in the world is to not get someone to make a purchase from your Facebook ad, but instead to scour the internet for discount. You do not. So many brands kind of portray themselves as discount branches because the actions of their affiliates.

Steve Weiss: So it's really important to like number one, really dictate where people can send traffic. Obviously number two, figuring out which specific affiliates you want in your program. A lot of the affiliates that are on like the ShareASale and Impact Radius. They're where you call discount sites. They're arbitrage affiliates.

Steve Weiss: They have coupons that they're taking in from all these retailers and they're arbitraging on paid search to get people to their site.

Steve Weiss: So number two, making sure you're working with the right type of affiliate. Maybe you want to focus more on an ambassador type affiliate, people who've bought from you in the past or people who have large influence over large groups of people. Those are the best affiliates. They have the best quality of traffic.

Steve Weiss: Then number three, obviously building a process around discount codes. Who gets a discount code? Which specific affiliates? What is the discount code form? When will it expire?

Josh: What is the purpose? I think you need to have created code with a purpose in mind, like are we trying to prospect here? Are we trying to convert remarketing traffic? Are we just giving this guy a code for whatever reason? It needs to have a strategy behind it.

Josh: And I think that's where sometimes clients can get messed up. Is that they're codes are just out there and they're out for everyone when really they don't have a purpose. Discount sites are fine, but you need to have a strategy behind it and say, "Okay, this is why we want to do that."

Josh: If it's just a short term high or you want some longevity. There needs to be some smarts behind that decision. Another thing I found really successful was just actually leveraging your commission based on your customer types.

Josh: In the modern day platforms you can often reward an affiliate for driving a prospect versus say someone that has been to the site before and obviously that comes from your particular platforms.

Steve Weiss: First time customers. First time customers.

Josh: Yeah. First Time customers verse remarketing. Obviously, that's quite powerful is you're awarding someone that's a fresh customer, and that to me makes a lot of sense compared to someone that is just literally... They're your customer. They love your business and they're just searching for that code to get a discount.

Josh: They shouldn't be rewarded as much as a first time purchaser.

Steve Weiss: Also it's really important to realize about attribution. So many times you're running affiliate programs and you're running Facebook campaigns and search campaigns. You're not really seeing the full brand lift in your store. You're really trying to understand what is the impact of this affiliate ad? What is the impact of a Facebook ad?

Steve Weiss: You see that the affiliates generating sales, but you're like, "Wow, well, will the sales be here if the affiliates not promoting this?" And I think the attribution side of really understanding lift 'cause if you remember, every time someone clicks on an affiliate ad, they're getting cookied.

Steve Weiss: So in a lot of cases, affiliates can carve up a little bit of intent, get a 30 day session cookie and in that person's browser and then really clean up by getting a commission when that person actually makes a purchase, which could be from a Facebook ad, a Google ad or a search ad, a native ad, an email.

Steve Weiss: Literally when that person purchases the affiliate gets credit. So really understanding attribution is seeing that, "Okay, well, we did X amount of dollars in our affiliate program while at this certain time we made X amount hours according to Facebook. What is the actual lift?

Steve Weiss: How do these numbers compare to numbers when we didn't have affiliates running? How do these numbers compare to when we had affiliates running at a much lower scale? How do these numbers compare when we have an affiliate running at a higher scale?

Steve Weiss: So I think having someone on your team that's consistently looking at the data and really making suggestions or trying to really... It's always like playing inspector gadget in a sense of really trying to interpret what does this mean? Like what is this?

Josh: And to get in the weeds just a little bit in that scenario we would run a correlation test, and really what we would do is look at the affect on your other channels when you first launch affiliate. And it's really simple to do in Google analytics. You can look at the performance of a channel A versus a performance of channel B, and actually measure the correlation.

Josh: Does what I do here significantly affect my other channels? Is there a crossover or not? And that's really impactful because you can really see, "okay look without this affiliate in play my organic or my direct, it wouldn't actually be as high as it would.

Josh: That's very, very important, as you're trying to establish what is actually going on here.

Steve Weiss: Yup. And also really start thinking about affiliate in a lot of ways, and not just coupon affiliates, but if you have a product that you have hundreds of thousands of customers for maybe building an ambassador program could be a good idea. Where you're just going after people who've purchased your product.

Steve Weiss: Really figuring out which specific affiliates are going to be the best for your program. Are gonna draw the best quality sale. I think that's very important as well.

Josh: Yeah, definitely.

Steve Weiss: So just quick recap, getting into affiliate marketing if you're an eCommerce brand and you're really analyzing is this a solution to the business of growing sales? Could this be a specific solution as part of the Omnichannel cycle?

Steve Weiss: Number one, set your rules. Have a very direct rule set of which affiliate, what can affiliates do? What can't they do?

Steve Weiss: Number two, figure out which specific types of affiliates that you want to go after. Obviously there's the coupon affiliates, there's ambassador type affiliates, there's influencer type affiliates.

Steve Weiss: Number three, if you are considering having a coupon codes and going after coupon affiliates who do drive volume, building a strategy around couponing. Which specific coupons? Why is there a coupon? Et cetera.

Steve Weiss: Number four, understanding attribution. Literally understanding actual brand lift from these affiliates.

Steve Weiss: Those are four things I think are really important to think about. Obviously there's ancillary, there's what tracking platform should I use, which creative should I use?

Steve Weiss: How do I build a process for someone to manage this? How do I make sure affiliates always have new creative? How do I police affiliates to make sure they're not using creative, I should say, that's off brand?

Steve Weiss: There's always all these other questions to ask, but those are the four key things to think about before you really jump head first into affiliate. Jeff, before we wrap up any other thoughts?

Josh: Look, I think there's a real place for an affiliate in a market or in a brand strategy. It's an important aspect. It needs to be done the right way and I think perhaps affiliate's got a bad reputation in the marketplace, but I think that's only because maybe you know, the people that are setting them up don't necessarily understand the space as best as you should.

Josh: There's definitely a real tangible value, not only to the channel itself, but the effect that it has on other channels if it's handled in the right way. So I think don't be deterred to the listeners out there. Don't be deterred, give it a go 'cause there's money to be made if it's done in the right way.

Steve Weiss: Great. Great. I'm just going to wrap things up. Another awesome episode of the Spend 10K a Day podcast. We'll be back in touch with you momentarily and we will also report back on the name change, which is coming as well. Thank you.

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