A case scenario, and question came in the email:
Lets say you had an existing business, with an affiliate program already up and running for several years. You have a large amount of affiliates in that program, some very productive and some not at all.
You then hired someone to be your affiliate manager…
If you could base that manager’s success/productivity on 5 pieces of measurable data, would they be?
Very good and important question. How do you measure what your affiliate program’s manager brings to the table? What key performance indicators should you focus on?
I like the request of narrowing it down to 5 KPIs, and here is my list:
1. Affiliates Recruited
Number of new affiliates recruited into the program by the affiliate program manager.
2. Activity Index
Calculated as the percentage of affiliates active in the program over a given period of time (one month recommended).
Number of previously stagnant affiliates activated within a given time period.
Increase in hits/clicks sent to your website by affiliates. Some also measure the number of impressions of merchant’s creatives/links, but I do not believe this to translate into any kind of valuable performance. While the impressions count may be interpreted as a branding mechanism, there are many other factors that can be tied in with impressions, and when choosing between impressions and clicks, I would recommend measuring the latter.
5. Sales Volume
Increase in sales (I’d say focus on the monetary figure) referred by affiliates.
While some would also like include the affiliate program’s conversion rate (CR) into the list of KPIs according to which an affiliate program manager should be judged, I would argue that frequently CR has very little to do with the manager’s performance. CR — if defined as the ratio of affiliate-generated qualified actions (sales, leads, etc) to the total number of affiliate-referred visitors to your website — is something that is significantly more dependent on the landing pages that the traffic is driven to (unless, of course, the manager is also responsible for an ongoing optimization of those landing pages). It is for the same reason that we should not include EPC (most frequently defined as earnings per 100 clicks), AOV (average order value), or any other KPIs that are predominantly contingent on factors disconnected with the key responsibilities of your affiliate program manager.