How can brands adapt to change and embrace publisher diversity?

“Wisdom is the ability to adapt to change.” -Steven Hawking

The past few years have been an extremely challenging environment for everyone. Consumers and businesses face a series of unforeseen curveballs, including a global pandemic, lockdown regulations, supply chain issues, regional wars and the sanctions that come with them, not to mention a cost of living crisis in times of extreme inflation.

With so many uncontrollable macro factors at play, a business’s success now depends largely on its ability to adapt to these turbulent times. Change doesn’t have to be scary, though. For the most nimble companies, from large corporations to emerging entrepreneurs, these quicksands have been a growth opportunity at the expense of slower-moving competitors.

Over the past few years, the affiliate channel has seen an explosion of partner types spanning every conceivable online media touchpoint, and advertisers can use the channel in a highly responsive way. The affiliate industry today represents a range of marketing options that can hit any range of KPIs, from brand awareness to new customer acquisition.

Combined with its heritage as a low-risk advertising model, where spend is tied to tangible outcomes like sales and revenue, and ROI is consistently high, it’s easy to see why advertisers are turning to affiliate partnerships in these difficult circumstances.

But getting the most out of this new option requires an active and experimental approach. Advertisers who are actively diversifying their publisher base in the current environment are most likely to see incremental growth. Those who are complacent and rely solely on a small, constant partner program for growth are unlikely to see it in the long run and risk over-reliance on them.

Don’t just take our word for it. We divided our selection of current Awin advertisers into two distinct categories that are consistent with the two approaches to illustrate the apparent difference in results.

“Insanity is doing the same thing over and over and expecting a different result.” – Albert Einstein

Awin works with thousands of brands of all sizes in various industries. Using the example of a group of big brands with a clear strategy, we analyzed two ways to manage an affiliate program.

Group 1 – Armchair Advertisers: The first group of brands used a very reactive approach to marketing, focused on a few core partner types, and ran traditional planning strategies with no room or budget to test or try out more diverse partnerships. Group 2 – Ambitious Advertisers: The second group of brands seeks a diverse program mix, has a fixed budget to accommodate market changes, and regularly welcomes new partner types to support this strategy.

Diversity of partners drives increased traffic

When comparing the two groups year-over-year, armchair advertisers saw a 6% decline in traffic, primarily driven by lower traffic across core publisher types, including discounts (-8%), loyalty (-9%), and cash back (-29%) %).

However, the ambitious advertiser benefited from audience diversity through its diverse partner portfolio, with a 29% increase in traffic over the same period. This growth has been driven by a variety of less traditional partners that have been embraced by affiliate channels in recent years, including SEM affiliates that saw a 162% increase in traffic from the previous year and CSS partners that saw a 76% increase.

Diverse alliance partner portfolio also drives sales

However, increased traffic does not necessarily equate to valuable business growth. However, on a year-on-year basis, sales performance showed a similar picture. The armchair advertiser program saw a 16% increase in sales, but the ambitious advertiser still topped that figure with an impressive 33% increase in sales. Again, the combination of new membership types is responsible for this significant sales increase. SEM partners grew +217% year over year, influencers +73% and CSS partners +58%.

Diversity of partners mitigates the impact of one partner type on AOV

An increase in average order spend is another common KPI for an effective affiliate program. Armchair advertisers saw AOVs grow 2% over the past 12 months, while ambitious advertisers saw AOVs grow 9% through the different types of partners they can leverage.

Digging deeper into this disparity, we tracked a significant 12% drop in AOV for just one partner type, impacting the growth of armchair advertisers who rely on this type of affiliate to drive nearly half of their sales performance. Although they themselves work with the same partner types, ambitious advertisers are not affected by this sudden drop due to the range of other partner types they work with.

Conversion rate remains strong at 4.76%

Eagle-eyed readers will notice that one metric by which armchair advertisers outperform compared to ambitious advertisers is conversion rate. However, this is not entirely unexpected. The latter group has much higher traffic, as we’ve already established. The variety of their programs means their programs affect the customer journey in a broader part of the marketing funnel, away from the traditional conversion space that last-click attribution metrics focus on.

While this means their average conversion rate is low (although close to 5% is still high), it also means that their partners are likely to reach customers early in the shopping journey. These are by no means wasted interactions. Instead, they can help ambitious advertisers drive important brand awareness goals, keeping their brand in mind when shoppers finally decide to buy.

“If life is predictable, it ceases to be life and has no taste.” – Eleanor Roosevelt

Therefore, we outline the benefits of building a more diverse affiliate program across a variety of important business goals. But who are these emerging partner types helping our ambitious advertisers?

Influencer

Influencer marketing is becoming an integral part of brand affiliate marketing strategies. We are increasingly seeing separate budget jars, KPIs and success metrics. In fact, over the past two years, we’ve seen content creators and influencers go from 5% to 8% of all web traffic. The number of influencers actively driving sales also increased by 8% during this period, with 112,095 influencers driving sales living on the Awin platform by 2022.

Feel Unique has partnered with Sellers Alley through Awin to diversify its existing influencer campaign beyond established social platforms to reach new audiences on TikTok. Using a testing budget and focusing on UGC-inspired ads, the activation resulted in a 27% increase in searches, an 84% increase in new user engagement, and 15,000 sessions on TikTok. Feeling unique impressions extends far beyond the TikTok community, with brand followings growing across multiple social platforms and increased site searches for products featured in TikTok events.

CSS (Compare Shopping Service Partners)

In 2017, Google Shopping welcomed third-party CSS providers to its Shopping Ads auction. While CSS isn’t necessarily new to the overall marketing mix, we’re increasingly seeing brands looking to work with one or more CSS partners through their affiliate programs, allowing for rapid campaign testing, without Risk-based CPA-based advertising, as well as consistent tracking and measurement with other partner types.

Awin has highlighted the growth of CSS over the past few years, and these partner types will be no exception in 2022. In 2020, Awin tracked performance through 20 different CSS partners, but in 2022, we now have 304 different partners active in this space, driving sales to the brand. Brands’ investment in CSS Partners has increased by 57%, and CSS Partners are now responsible for driving 4% of total network sales.

technology partner

Technology Partners are an exciting way to diversify your program, but it’s also worth noting the diversity within the umbrella term “Technology Partners.” There are 109 technology partners on Awin and a different partner for each goal. If, like many retailers today, the current cost of living crisis is affecting the number of items consumers buy in each store, a live bundle partner like Growing or Special Audience may be the partner of choice to support you in advancing this goal. Or, if your business changes the inventory and timing to move, a partner like RevLifter that focuses on personalized offers, or intent.ly’s live coverage technology might be able to engage consumers during their shopping journey and incentivize specific Best choice for buying decision. Technology partners allow you to accelerate your own in-house innovation and remove traditional martech barriers around allocating development resources and costs. Year-to-date, our technology partners have generated over £160 million in global sales for our brands.

brand cooperation

Another impressive recent partnership success story of Awin is the brand-to-brand partnership. Advertisers are increasingly partnering with complementary, non-competing brands to reach potential new audiences with similar values. Brands can promote each other and create mutually beneficial partnerships, or follow a more traditional membership partnership model where one promotes the other.

Awin UK has tracked over 450 active brand partners so far this year, bringing in £1.7m in revenue.

Awin has also partnered with two vendors that specialize in creating custom rewards portals that brands can showcase on their own websites. These provide a seamless, fast and effective white label solution to fast track your customer reward space on your e-commerce website to further enhance your offerings.

The restaurant card membership brand Tastecard is one of the pioneers in the field of brand collaboration. They saw their entire business model grind to a halt at the height of the pandemic lockdown, but quickly changed their business model and partnered with Awin on a branding partnership to continue delivering incredible food to their members during restaurant closures the benefits of. By promoting other branded products to Tastecard audiences, they are able to maintain customer loyalty and bring new revenue streams to the business, which have become an established part of their offering.

Diversity as Awin’s North Star

These insights we outlined above help inform our strategic direction at Awin. Understanding diversity and being proactive in building new partnerships is critical to continued growth, which is why we have developed a new North Star metric to guide our priorities and goals as a business.

Awin’s North Star metric is simple; increase the number of active partners tracked through the platform each month. This benefits brands and partners, provides continued growth opportunities, and gives brands and affiliates the option to enter different partnerships, ensuring that their performance goals are met and limiting the risks involved in relying on fewer partnerships.

If you’re interested in diversifying your partner portfolio, testing new partnerships, or wanting to learn more about our case studies, be sure to join us on Tuesday at 2.50pm on the main stage of PI Live with Awin Meeting with Chief Account Officer David Lloyd, or contact directly to [email protected]

To explore the variety of partners you can work with through Awin, check out the Power 100 in this year’s Awin Report 2022 – our selection of the 100 most innovative and impactful partners on the global platform.

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