FAQs

Affiliate and partner marketing is a performance-based marketing strategy where a brand partners with a third-party website to promote their brand, generate traffic to the brand’s website and to provide sales for that brand. In return, the third-party receives commission and payment for their part in the sale. The third-party is known as an affiliate, partner or publisher.

Unlike other marketing channels defined by their activity (email, display, etc.), it is more accurate to classify it according to its cost-per-acquisition (CPA) model. Typical publishers include price comparison, cashback, loyalty and reward portals as well as voucher code websites. The channel has become increasingly diverse with influencers, tech start-ups and bloggers using it to generate revenue and fund growth.

The robustness of the business model and its ability to track sales even as third-party cookies become obsolete makes affiliate and partner marketing an appealing option for brands. It is typically reliant on first-party tracking that is implemented on the advertiser website which means brands are in control of what data is shared. There is no hierarchy of third party companies sharing and using customer data.

Because the channel doesn’t rely heavily on personalised identifiers to track sales, with the tracking information used primarily to apportion sales and commissions to affiliates rather than target personalised ads, it’s also a privacy-conscious option.

There are usually three or four companies involved in delivering an affiliate or partner marketing campaign. The advertiser who wants to sell their products and services and the publisher (also known as partner or affiliate) who will promote the advertiser on their site or through their links are the two companies who need to connect.

It is typical for an advertiser to select an affiliate network or platform to run their programme. This might mean they are just licensing their technology for the tracking, payments and reporting, or they may be getting all three of these as well as account management from the network or platform to help run their programme.

Alternatively, if the advertiser doesn’t have the time or expertise to run their programme, they may appoint an agency to run it for them. There are a range of agencies from affiliate focused ones to large media agencies with affiliate and performance teams.

The set up is flexible and is usually shaped by the individual needs of the advertiser and their budgets.

Affiliate and partner marketing is well known for delivering excellent bang for your buck. While there isn’t any recent data on return on investment (ROI), typically brands can expect around £11-£17 in return for every £1  they invest.

Because advertisers set the commission they pay publishers, this has a direct impact on their ROI. So for example if a retailer pays 5% commission, this will mean they are getting an ROI of £20 for every £1 spend (100% / 5%).

However, it is important to factor in additional costs. Networks and platforms will have their own fees that are largely based on performance. This is typically known as an override. Taking our example, they may charge 30% override on the 5% commission (30% of 5% = 1.5%), so in this instance the commission and network fee totals 6.5% (5% + 1.5%).

Increasingly networks are charging a percentage of the advertiser basket as their fee. So if your average order value is £100, they may charge 1.5% of your basket (in the same way a credit or debit card provider charges a fixed fee per sale). In this instance you would still pay 5% commission, but also the percentage of your sale to the network.

It is important to also consider that networks and platforms may also charge a monthly fixed fee for access to their reporting and payments platform. They may also charge for additional services. do your research and shop around, they will all have ratecards they can share with you.

According to the 2022 IAB & PwC Adspend numbers, the UK affiliate and partner marketing industry is worth more than £1.4bn. With a return on investment of around £15 for every £1 spent, it is one of the most cost-effective ways retailers can drive sales. The channel also punches above its weight, accounting for more than £20bn in ecommerce revenue for British brands.

This question is a little bit like answering ‘how long is a piece of string’. The beauty of the affiliate and partner channels is they provide a high degree of flexibility about who you work with, but it’s also a two-way relationship. The publisher will want to know you’re a good payer and run a fair programme before committing to working with you.

When you’ve set up your terms and conditions, you will have access to thousands of potential affiliates and publisher partners. These are drawn from across the digital marketing spectrum and include:

• Cashback sites like Quidco and TopCashback
• Voucher, coupon and deal sites like Global Savings Group and vouchercodes.co.uk
• Price comparison sites like Broadband Genie and Finder
• Technology partners who can help drive up conversions and average baskets like Intent.ly
• Google Shopping Solutions like Genie Goals
• Email
• Influencers
• Content and Editorial sites
• Paid search
• Mobile
• Remarketing and Display partners

One thing to bear in mind is it can take time to build these relationships. You should only launch an affiliate programme if you’re in it for the long haul! Again, networks, platforms and agencies will be able to advise you.

Everyone’s resources and time are stretched, but it’s true to say, that with affiliate and partner marketing, you get what you put in. Be prepared to allocate at the very least, half a day a week if you’re a small business and more if you’re a large business with additional people on the ground.

There are set tasks and functions you need to perform including approving affiliates, processing sales and managing payments as well as the day-to-day admin involved in running reports and handling creative, not to mention building good affiliate and partner relationships.

Often brands fail at affiliate marketing because they fail to invest enough resource. While the industry is becoming more automated, it is not the same as running other paid marketing channels and is certainly not plug-in and leave. That said, you can build some of the most rewarding and valuable relationships you will ever have with publishers generating your next customers for you.

Sign up to The APMA newsletter and we’ll update you on all the most important changes and developments. Also, sign up to receive information from networks, agencies and publishers. Many of them have a wealth of content they will share with you as you embark on your affiliate and partner marketing journey. Good luck!