Affiliate marketing is a sector of advertising where a third party advertises products or services on your behalf in return for a pre-agreed commission for a sale or lead.
The solution differs from a general media buy as the costs are pre-determined at profitable levels for you so return on investment is guaranteed. Affiliates themselves can range from an individual managing a personal site in their spare time from their bedroom to a large shopping portal that receives millions of visitors a month.
TBG has two methods by which to manage your affiliate marketing. Super affiliates are those media owners who deliver 90% of the conversions to your site. Often this will be the top 10% of your affiliate base. We have direct relationships in place with the majority of super affiliates so manage these within the media team as individual partners. The rest of the affiliates who do not deliver as much volume are managed via an affiliate network. An affiliate network is generally a technical solution which delivers advert creative to the media owner’s site and monitors conversions. With literally thousands of affiliates on their books, the network also pays them their monthly commissions and answers any simple campaign queries.
TBG begins the process of a new affiliate marketing programme with analysis of competitors within the market. The main benefit of this activity is to ensure bounty setting is competitive and also allows both agency and client to see where competitors are running less than perfect campaigns.
One of the major issues facing those using affiliates to market their product and service is the prevalence of fraud in the sector. There are many different ways in which this can occur but just one example would be via cash back sites (cash back sites have thousands of registered users who receive up to 50% of the affiliate’s commission by using the site as portal), where a cash back user could purchase an item from your online store via the cash back site link, be paid the commission and then return the item – here the affiliate would also earn a commission for a fraudulent sale. Another example could be of an unscrupulous affiliate acquiring user’s application details for a secured loan and then retyping this information into multiple client application forms where here they would be paid on the same data multiple times. TBG will discuss tracking options with you which can monitor this. We hold a strong position with regards to online fraud and take a proactive approach. We will withhold commissions on orders or applications that appear fraudulent until a time when IP and session data proves otherwise.
TBG commissioned an affiliate marketing survey for the UK market in 2007. The results of which can be found here.
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