The world of affiliates is having somewhat of a resurgence. Consumers are straying away from the brands they know and trust and browsing around to see what other options are out there. Affiliate sites are making the most of this and, as a result, there are some strong affiliates appearing in all sectors.
So, as a merchant, how many affiliate networks do you need to work with? Is it a case of the more networks you’re on the more money you’ll make?
It could be easy to assume that working on more than one network has economies of scale from a workload point of view and at the same time, doubles your sales. In almost every instance, this won’t be the case.
There can be some advantages to working with more than one network:
- In some cases big affiliates will work more closely with one network and therefore you may get better opportunities. However, big affiliates understand the need to work closely with many networks to ensure they have access to the best merchants for their site.
- Some affiliates may not know/work with the network you are on. However, as long as you research your market, you should be able to reach out to those affiliates and encourage them onto your programme without the need to run with more than one network. Most affiliates will work with most networks.
- If you’re a lesser known brand, it may be harder to encourage an affiliate onto a new network just for you. In this instance, being on multiple networks widens your scope.
OK, so what the drawbacks of running with more than one network?
Although there are some time savings that are made when working across multiple networks, our experience has been that 2 networks increases the investment at almost every level by around 80%.
The drawbacks include:
- Frustrating affiliates
Unless the programmes are run in complete parallel with the same promotions, commissions and communications run at exactly the same time, affiliates will either have to spend time flicking between networks to get the best commission or will miss out – either way, it will be much more difficult to build a strong relationship with them.
- Duplicated commissions
You will have to work with one/both networks to ensure you don’t end up paying duplicate commissions on both networks.
- Network Costs
Depending on the deal you work out, you may have to pay more in monthly fees. However, it is often the case that you can get a commission override deal only on second and subsequent networks.
- Technology Costs
There will certainly be additional coding/tracking that needs implementing when running more than one network which, depending on your website management, may incur additional costs.
SO how does it affect your ROI?
In many case, having more than one network can siginificantly lower your ROI.
- 2 affiliate interfaces have to be managed – double the investment for less than double the reward
- Every promotion and communication has to be done twice – again double the investment for less than double the reward
- More than double the reporting – some affiliates will drive activity via both so you need processes in place to combat this
- Any technical changes have to be made twice
There are people that are strongly for using more than one network and those that are strongly against. I believe it depends on many factors – your brand, the affiliates you’re trying to reach, your reporting capabilities, your website development process and more.
One of the most important factors to take into account is the time you have available to manage your affiliate programme as without a doubt, the more programmes, the more time resource you will need.