The Increasing Challenges Faced in Trying to Accurately Categorise Affiliates
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Affiliate categorisation was once a cornerstone of affiliate marketing, enabling advertisers to segment their programmes by the types of affiliates promoting them. As the affiliate channel has matured and continues to become more sophisticated, boundaries are becoming blurred. This is making it increasingly difficult to categorise affiliates based solely on their promotional type. This, coupled with the clamour for more informed decision making on the provision of data, has meant that affiliates should be assessed on their individual merits, rather than simply being grouped by their traditional category.
By classifying affiliates by their primary promotional method, there is the assumption that all affiliates within each category will be utilising the same techniques to drive traffic to their sites. This also indicates a belief that the visitors to each site within the promotional category will be of a similar quality. However, these assumptions do not necessarily hold any truth. There is a significant amount of crossover between affiliates’ promotional methods, yet how they drive traffic to their sites will vary. This will have an impact on their target audience and the quality of customer they are able to deliver to advertisers.
A good starting point to understand how affiliate categorisation could be problematic is by looking at voucher code sites. It is widely assumed that the majority of traffic to these sites will arrive through searching for a brand plus a discount related term. While it is highly likely that a significant volume of traffic will be generated this way, it neglects a wide range of promotional methods that these sites also utilise.
The top voucher code sites will typically have established a large database of engaged users that they are able to target with relevant offers. Again, as data plays an increasingly important role within the affiliate channel, voucher code sites are positioned to ensure that the best offers will be reaching the most appropriate audience. Another area that is neglected is their ability to benefit from the use of social media to distribute timely deals to their loyal followers. It is typical for users of voucher code sites to be more loyal to the voucher code site than the brands they are actually purchasing from. This also neglects the fundamental fact that these sites are now mature shopping destinations in their own right, with traffic far outstripping that of the vast majority of advertisers they promote.
It is not just voucher code sites that are witnessing a blurring of boundaries. Similarly, the top cashback sites are continually evolving to offer its members the best offers available. Now, rather than being purely a cashback site, they are repositioning as money saving sites – making them increasingly difficult to categorise within the confines of rigid promotional types.
Aside from just looking at incentivised sites, this is also true of affiliates that have traditionally been categorised as content affiliates. There is nothing to say that these affiliates are not using additional promotional methods such as PPC campaigns or listing discount codes within the content. Looking at it from another perspective, incentivised sites could even argue their case for being content sites: they are now offering a significant amount of content that is relevant to their visitors.
The fundamental issue with affiliate categorisation is that it is far too simplified. It is no longer suitable to distinguish that an affiliate is using a single method of promotion to drive traffic to advertisers or that because their method of promotion is similar, they will attract the same visitors as a site within the same promotional category.
In order to gain the most from the channel, advertisers would benefit from assessing affiliates on their individual merits rather than confining them to a group based on promotional type. This would allow advertisers to really understand the quality of each of the affiliate’s traffic and the type of customer they are able to deliver. This value can be based on the metrics that are of importance to the advertiser and could include elements such as; the split of new vs. existing customers, average order values and customer churn. By understanding the value of each affiliate as an individual, they can be rewarded accordingly. Advertisers will also be able to identify where to spend their money more effectively to achieve the greatest return on investment in terms of customer quality.
To summarise, the cross-over in promotional types across the affiliate channel has led to categorisation becoming outdated. Affiliates are no longer relying on one method of promotion to generate traffic, favouring a multi-faceted approach to attracting, and keeping, visitors. Advertisers that are able to demonstrate the ability to be flexible and understand affiliates on their own individual merits will be better placed to reap the rewards afforded by the channel.