How to Bring Affiliate Management In-house and Deliver Long-Lasting Returns
The practice of in-housing as a whole first started to gain momentum over the past few years and it has really hit its stride in the beginning of 2020. According to a survey by MediaLink and WARC, 34 percent of marketers worldwide are planning to increase in-housing across all marketing disciplines in 2020. For some, it is about control and ownership, for others, it could be the need to manage fewer vendor relationships and for some, the cost benefits weigh on the favor of in-housing. Regardless of the reason doing so still can prove a daunting task for brands who may already be managing other Digital Marketing channels.
In some cases, we see that brands want to commit to an outsourced full-service management program for a period of time initially, and then scale back the service component as they become more adept at the intricacies of Affiliate Marketing.
Several months ago, we commissioned research with Forrester Consulting that outlined key concerns executive-level marketers have with affiliate that may hinder their confidence to self-manage their program. One of the primary concerns is that they don’t think they have the skills or expertise to manage a program. For others, they have a preferential bias for channels they have a comfortability with, and that sometimes puts affiliate lower on the priority list.
It is these reasons which exacerbate the scarcity of affiliate resources and knowledge available to brands to import and own their affiliate strategy and execution end-to-end. There is no Affiliate University and the learning curve makes it difficult to master on the fly. As a result, more brands are recognizing their needs gap and are adopting approaches that will help them build expertise over time so they aren’t wholly reliant or dependent on a fully outsourced solution.
For those looking to do the work and bring affiliate practices in-house, marketers should consider implementing a staggered approach. A closer look at the success we’ve seen with these in-housing initiatives reveals three key phases that will have marketers operating a masterful program in a matter of months. Each phase of the in-housing timeline is outlined below with guidelines on how long each phase could take depending on resources:
– Phase 1: (Guided) During this time (first 6 months) the brand’s role is to provide guidance on their goals, budget, and general marketing approach. The brand doesn’t have affiliate expertise, so they rely on outside affiliate service teams to set the strategy, recommend the ad spend allocation based on the budget, and advise on premium placements. The retained or outside management team typically will execute the program and pull all the optimization levers.
– Phase 2 – (Consultative) This phase usually takes place during months 6-12. By this time the brand has cultivated knowledge of the channel and is now familiar with publisher partner types and they have enough understanding to venture in and start handling a few elements on their own. For the most part, they are not yet in a position to understand what the optimal performance benchmarks are on a partner segment basis and they still need guidance in selecting premium placements that will drive enhanced program performance. During this time your affiliate service team should service the role as adviser and consult on those complexities that are still foreign to you. By this time the brand is comfortable pulling the levers in the platform, but they need to be guided through more complex initiatives to ensure their time and dollars are appropriately allocated. Phase 2 usually requires a brand to dedicate a greater percentage of staff time.
– Phase 3 – (Self Managed) By this time the brand owns the channel. They are developing their own affiliate channel strategies, performing optimizations on their own, and can navigate their way through the platform like a pro. Their affiliate provider should still offer the in-house team support and be available for general inquiries, but by and large, the brand should a be self-sufficient affiliate practitioner with category knowledge.
Here is the graphical representation of what in-housing migration could look like.
As the affiliate channel continues to evolve and shed the legacy systems of years past, marketers will need some element of education in order to bring their programs in-house. With a little patience and a trusted partner, marketers will be on their way to self-management in no time at all.
Once it becomes a goal, every brand’s journey to cultivating in-house expertise is different. Depending on available resources, and speed at which the brand moves, developing in-house expertise can happen in a shorter time frame, over months, or be a longer-term initiative, taking a year or greater. No matter the timeline, those who succeed will take a phased, methodical approach, remaining flexible and adaptive along the way — as the beauty of this space is there is always more to learn to shape and sharpen the course.