Affiliate Is More Than Just a Performance Driver, and 2022 Will Prove It (Again)

Affiliate naysayers have had the same critiques for years, and the industry has proven them wrong every step of the way. People have labeled the affiliate industry as old or outdated, but it's more data-driven and hyper-personalized than ever before. They’ve called it rigid, yet advertisers can create dynamic commissioning structures that allow them to meet a wide variety of flexible business needs. As we enter 2022, we’re seeing more critiques of the affiliate marketing industry fall flat. This time, the idea that affiliate is simply a performance driver is now in question. Merging brand and performance Smart marketers understand that both brand and performance are critical to overall success. Gone are the days where a CMO can prioritize just one or the other. Now, marketing teams are tasked with balancing budgets among different siloed strategies that operate independently but complement one another. Traditionally, marketers will invest in brand awareness drivers like display, online video and linear TV, then layer in performance strategies like affiliate to drive sales. But affiliate is becoming more than just a driver of sales, and smart marketers will need to understand how affiliate fits into their upper-funnel strategies if they truly want to get the most out of their investments. But how is affiliate becoming more than just a driver of performance—and why should marketers care? Survey: Publishers See a Bright, Cookie-free Future Publishers are in power The short answer is simple: innovation. We’ve been seeing the industry organically move in this direction over the past couple of years, especially with the deprecation of third-party cookies on marketers’ minds—even though Google has since pushed back the deadline on when the proverbial switch will be flipped. The long answer is an age-old story of power, or lack thereof if you’ve been a publisher. For decades, marketers found themselves in the driver’s seat. They had access to third-party data that allowed them to target and segment accurately and with ease. But with that data going away, publishers now find themselves in a unique position of power. They own first-party data that marketers now need to maintain those targeting capabilities—and marketers now find themselves at their mercy. As a result, publishers understand now is the time to capitalize on this demand, and the affiliate industry has changed quite drastically as a result. Now, the relationship between publishers and affiliate marketers is mutually beneficial. Brands are providing more transparency into their marketing objectives and becoming more flexible with their commissioning structures to tap into that gold mine of first-party data publishers now sit on. Attribution takes center stage Going into 2022, the relationship between affiliate marketers and publishers is going to continue to evolve. The only difference is the area of focus. As an industry, we know that affiliate links provide value far beyond the last click, but tracking and quantifying that value has been a challenge. Now, with publisher power at the forefront, the industry is going to have to address that challenge. Publishers want to be compensated for their influence on every purchase decision—even if they aren’t the ones driving the final conversion. Consider a holiday shopper reading an article on the top 10 toys of the season, then clicking on a link for a new video game console, going to the page, but not making a purchase. Later, that same shopper sees an advertisement for the game console on a YouTube video, clicks the YouTube link and makes the purchase. While the holiday shopping article didn’t ultimately drive the conversion, it certainly played a role in discovery for the shopper that ultimately led to a sale. With the pendulum of power swinging back in publishers’ favor, finding ways to attribute value to an affiliate link throughout the entire sales funnel is going to be a major focus for the industry in 2022. Addressing the 'how' There are certainly roadblocks that the industry will work to overcome this year to make full-funnel attribution for publishers an industry standard, the biggest being omnichannel tracking and measurement across all devices. Especially with the third-party cookie going away, privacy-first ID technologies are going to be put to the test. Whether it be through the adoption of cohorts, server-to-server endpoint measurement or another method, the industry will look for workarounds to visualize the entire customer journey through data. With these logistics figured out, the affiliate marketing industry is poised to become so much more than just a performance driver. Once we understand how a click today can turn into a sale tomorrow (or next week), publishers will be demanding that their affiliate partners compensate them accordingly. As this becomes fully realized, marketers will need to fundamentally change the ways in which they think about performance vs. brand—and affiliate will be at the center of it all. Affiliate Marketing Modernization Brings New Possibilities