Robert Glazer is the founder of Acceleration Partners, and author of “Performance partnerships: The Checkered past, Changing Present and Exciting Future of Affiliate Marketing”. Robert has been a leader in the affiliate industry for over a decade.
You may remember I went to PI Live last year to swot up on Affiliate marketing – and attending the conference reminded me what a powerful marketing method affiliate marketing can be, when done right. It’s a topic we don’t often get into on the show – which is why when I came across Robert’s book I knew we had to get him on.
Getting Started with Affiliates in eCommerce
Years ago, Robert started a product review website. He was always the type to research products and get all the information, so he decided to start a newsletter to help his friends determine which products he recommended. That’s when he learned about being an affiliate through the Amazon program.
Later, as a publisher for Tiny Prints, he saw that the company had no formal affiliate program and needed one. The founder asked him to help set it up, and it went from there.
Listen to learn about cultural complications when moving into new markets overseas.
Robert’s book is set up as a history. He wanted to make it a story with his story intertwined, and a book that people would want to read. There is little content about the industry of affiliate marketing. Since there is something of a negative bias against affiliate marketing, he also wanted to own that, find the problems with it, and look back to see what everyone can learn.
Performance Partnership Versus Affiliate Marketing
There are far too many definitions of affiliate marketing and performance marketing. In the affiliate space, people have been rebranding themselves as performance marketing because they didn’t want to be associated with certain elements of affiliate marketing, and there are people in the paid search space and SEO also calling themselves performance marketers, which makes it confusing to know what the terms actually mean.
Robert wants a consistent definition of a performance partnership, which is the good part of affiliate marketing without the stuff that’s giving the industry a poor name. There are four elements to this. First, there has to be a CPA, or cost per action. This is cash on delivery, it’s paying for output, it’s paying for it when you get what you want.
Secondly, there must be transparency, which is different from early affiliate programs.
The third element is a real relationship or partnership. Instead of being transactional, make decisions that are in the long-term interest of the partnership and not just optimizing for the day or the transaction.
The fourth element is real-time tracking and payment. Both parties should have real-time access to what’s going on.
The relationship comes first, and the method of tracking allows the businesses to scale.
Listen to hear an example from Tiny Prints.
The Network Option Versus the SAS/DIY Option
In the network model, the network represents both the buyer and the seller in the same transaction. If the buyer makes more money, the network makes more money, but they are paid by the seller. Although this is efficient, there have also been some conflicts of interest.
A large company might prefer to license their technology that has the same functionality as a network. Reebok, for example, might not want to network their relationships with athletes and make them available to Nike.
On the flip side, a brand new company entering the market without any brand recognition may want to work with a network to get in front of publishers who are already out there. It depends on the goal and the reach of the company.
You have to make sure you’re incentivizing your affiliates to get the results you want. If you show them the incentive, they’ll show you the behavior. If someone is paid 20% for all the display advertising they can place for a company, they’ll place a lot of display advertising. They won’t actually care if it works, because that’s the incentive they’ve been given.
Listen to learn how Robert’s team has aligned business incentives with values, and why relationships and transparency matter.
Is Affiliate Marketing Right for You?
While everyone should be interested in the concept of performance marketing, that is, paying for outcomes, there are logical size points to consider. A company has to have the staff to manage it and the resources to put a good effort behind it. Robert recommends that a company be at a million pounds before they consider a partnership program.
Listen to learn why an unproven product with no market awareness is often a tough sell to an affiliate.
Top Tips for Starting an Affiliate Marketing Partnership
- You need a resource. You need to find someone who knows what they are doing. It’s a high learning curve, so find someone who is experienced and can manage it, or find an agency or network to help you.
- Then feed your partners things to talk about.
- The key is to recruit and manage relationships with your affiliates.
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eCommerce Book Top Tip
- Principles: Life and Work by Ray Dalio
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- Thought leadership. How can you add the most value?
You can hear about all this on the podcast, for free – right now…
Tool Top Tip
Start Up Top Tip
- Pick something you really love to do and you’re passionate about. You’ll do better at it. If you’re an affiliate, write about things that you really care about.
- Business <– download the first chapter for free
- Robert Glazer website
- Friday FWD
- Have a listen to our interview with Wink Beds
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