Oh, how times have changed. Today’s leading merchants are taking a more comprehensive approach to collecting and using data — to understand users, track and optimize buyer flows, and determine the specific role that partnerships play in the marketing mix.
My company tracks and analyzes partner marketing programs, and from this unique vantage point can assess how retailers are changing their collection and use of partner and affiliate marketing data. Here are three key ways data is transforming how brands approach, manage and optimize partnerships.
Seeing Every Step of the Path to Purchase
Between the click and the purchase, there are many steps in the customer journey that marketers want to understand. Users might browse deals, conduct a brand or product search, check sizes, and add items to cart. Each of these “conversion events” helps the marketer understand where a retailer is holding on to – or losing – would-be buyers.
Across our merchant client base, we are seeing many businesses begin to track all of these interim consumer actions in order to better understand user flow and decision-making processes.
I recently had a conversation with Rob French, affiliate manager of leading Canadian luxury retailer SSENSE, which confirmed the assertion. He believes that a granular, real-time understanding of pre-purchase buyer behavior offers critical insights for affiliate and partner marketing optimization.
“The shopper is very savvy on price, size and stock levels, and these will reflect on their decision-making process during a purchase. We look to constantly learn more about their behaviors by analyzing a combination of data from our internal systems and our affiliate platform. Through this analysis, we draw insights that help us identify new opportunities by region with luxury influencers, content partners, and fashion aggregators. That enables us to drive the intent-to-buy decision forward and improve on our business roadmap,” French said.
Using Item-Level Data to Adjust Featured Products
In the early days of partner marketing, few brands tracked the specific items that were sold to customers through the channel. As a result, retailers usually focused partner marketing efforts on universally popular or highly profitable items. But that simplistic approach is changing rapidly as brands learn to customize product assortment by partner and even individual shopper.
Travel is where this has been most apparent. Many travel companies share meta search data with partners, in order to enable them to deliver more personal – and effective creative. For example, if I have searched for a flight to Orlando, a travel company can share that insight with partners so they can deliver customized creative on great fares to that destination. Click and conversion rates for such ads are far higher than for generic creative.
Also Read: Three Retailer Lessons from Amazon Go Stores
Integrating Partner Marketing Data into Multi-Channel Attribution Models
Many companies are investing in multi-channel attribution tools to better understand which elements of their marketing mix are making the largest contributions to sales. Multi-channel attribution is concerned primarily with all marketing channels and which touchpoints actually caused a purchase, and what their relative importance was to enable the transaction.
Multi-channel attribution is particularly important to partner marketing because many companies struggle to understand the proportion of sales that are incremental through this channel. Traditional, “minimalist” partner marketing measurement didn’t provide the data necessary to measure the true impact of partner marketing efforts across the mix.
But that is changing rapidly. And, how?
At SSENSE, French reports that the complete measurement of all touchpoints has changed the way his company understands and assigns a value to partner touchpoints in multi-channel attribution modeling.
“We’re currently building attribution models across our entire business to improve how we measure the efficiency of our multi-channel stack,” French says. “The affiliate channel will be a big part of how we go about creating a fairness across our partners. One strategy is to compensate partners that contribute to a sale at different steps during the customer journey. Upstream bonus compensation can help ensure that content partners are fairly compensated for the important role that they play in driving sales.”
As more companies understand the incremental growth enabled by partner marketing, investment in the sector has grown. According to a recent Forrester study, affiliate and partner marketing account for 16 percent of total e-commerce sales, and many analysts expect that figure to grow.
These are just a few of the ways that greater and more timely access to data is transforming the partner marketing channel. As you consider your partnership efforts and how to drive growth from them in 2018, start by using ALL of your customer data to its maximum extent. And make sure that you learn how best to leverage partnerships to improve effectiveness across the marketing mix.