At the past Affiliate Management Days conference in London I met a bright gentleman from Germany who was (and still is) working for one of the country’s major e-tailers. Today, nearly a year later, I have a pleasure of welcoming him as AM Navigator’s newest guest author. Meet Julian Henrichs and read his first post below.
If you knew all affiliate management’s best practices and levers inside out, would you let a robot do the work? (Notice I’m a huge fan of Utopia)
Geno estimated the time an affiliate manager should allocate to each responsibility and task. If you could use this information and add thousands of case study findings, statistics and research papers when programming your robot to ‘manage’ affiliates, would that be effective? A robot scaling an international affiliate program?
First, let’s look at factors even a robot affiliate manager would have to consider, particularly in fashion ecommerce.
Business Type/ Vertical:
Not every affiliate or partner suits your business or niche. Consider a luxury fashion retailer. They won’t have the same structure of affiliate types as a discount retailer. No voucher sites and no cashback sites. Does that make time management easier? Not really. Instead it means you need to find different and less efficient ways to grow your program. In the fashion industry partnering up with bloggers has become paramount. The relationship between an affiliate manager and blogger is a bit like a flower. It starts off small, needs a lot of nurturing to grow and only then can it really blossom.
Maturity of the Affiliate Program:
Ok, there is the 80/20 rule. Most of the affiliates that contribute to 80% of your revenue are out there and the top players for your business. Like Geno suggested, when starting a new program you will need to spend around 40% of your time recruiting affiliates.
However, in a more mature program I decrease this share and increase ‘Activation and Communication’. Firstly by recruiting long tail, when you have already integrated 20% of the affiliates that will generate 80% of the revenue, decreases your marginal benefit. Secondly, it eats up lots of resources managing that ‘long tail’. Following up, reminding, structuring data, you name it. By focusing more on “Activation and Communication” you can scale a bullet-proof business model.
Do not exaggerate the 80/20 rule. There are some strong potentials with high growth you’d eliminate from your radar. Imagine you’re a startup and want to be mentioned by a super huge affiliate. Would they consider you?
What kind of affiliate can you integrate into your program? Only Content or even PPC, Retargeting, Display, RTB? Depending on the organisation and size of the marketing department, the width of your affiliate type portfolio will change as well. This makes time management easier, but lowers chances to make it a high volume performance channel.
In fashion, seasonality is an influencing factor regarding time management and allocation of resources. At the start of a new season or when a new collection is launched, I shift resources from ’Recruitment’ to ‘Activation and Communication’. Do you feel the heat when a new product is launched? A new collection? Everyone seems to be working like ants. That’s when time and resources are reallocated.
You’ll see that Geno’s structure of time allocation makes total sense. In addition, it is each Affiliate Manager’s responsibility to adjust this structure due to certain characteristics of the vertical he is working in. Flexibility is key.
At the start of this article, I asked if you’d let a robot assume the role of affiliate manager.
My answer is a resounding no.
The essence of affiliate marketing is about building relationships, trust and mutual help. A robot simply isn’t capable of that.
As outlined in Jay Baer’s book Youtility marketers and businesses should provide real benefits and proactively help their partners or customers they rely on.]]>