Why Affiliate Needs Paid Media #23

RBL Flywheel Newsletter #23 🐐

Affiliate Marketing is the most misunderstood and underrated performance marketing channel.

For a lot of reasons discussed at length in this newsletter.

It can be your most efficient for CAC and ROAS and makeup >20% of your revenue. 📈

But it is an ocean liner…

not a speed boat…

It does not start and stop on a dime like Search, Social, and Programmatic.

As a result, Paid Media can complement, accelerate, and amplify Affiliate Marketing.

So let's dig in.

There are only so many ways you grow a modern business.

As we have talked about, growth loops are more effective ways to think about growth than funnels.

Yes, you need both.

Another shameless Reforge plug. If you are on the fence, just do it.

You can grow via:

1. Content Growth Loop (SEO, Earned and owned media) e.g. HubSpot, Yelp

2. Viral Growth Loop e.g. Facebook, Slack, Chat GPT

3. Sales Growth Loop e.g. Salesforce, Palantir, Mongo DB

4. Paid Marketing Growth Loop e.g. Uber Eats, eBay, Monday.com

Paid Marketing includes:

1. Affiliate Marketing (yes this includes partner and influencer marketing as discussed, deal with it!)

2. Paid Media (Paid Search: Google & Bing PPC, Paid Social: Meta & TikTok ads, Programmatic: TradeDesk/Moloco/Media Math)

Why does Affiliate Marketing need Paid Media?

Strike a balance between agility and long-term sustainability ⚖️

Think speed boat (paid marketing) versus ocean liner (affiliate marketing).

Some call it performance PR (PR takes more time than Google Ads).

Gifting influencers your product - they don’t write about you before learning about you and often prior to structuring a deal.

Use them together to get the best of both worlds.

Affiliate is an incentive structure, not a channel 🔂

This might sound confusing because it’s understandably referred to as a performance marketing channel

Yet it is more like a performance marketing incentive structure.

With affiliate marketing, you can pay for valued actions rather than your typical clicks and eyeballs

You can get granular with those payouts paying a small amount for the most micro action on your brand's site or app, while simultaneously paying partners (affiliates or influencers) a higher amount for actions that are measured and deemed more valuable for your brand.

For example, a large hotel chain could payout $5 for a lead and then 10% of the sale once a booking is confirmed

Affiliates can literally buy media ANYWHERE they simply charge you on a cost per lead or cost per sale (or other valued actions).

Yes, even Podcasts and Connected TV.

Some Partners Require Paid Media 📺

A lot of partners monetizing via affiliate require paid media.

Influencers, gated platforms, loyalty sites with large followings of millions per month have earned the right to charge upfront fees given how many followers, visitors, and engaged users they have acquired over the years.

Affiliates can improve SERP exposure 🔎

Google has not taken it over entirely yet although they are close. (SERP = Search Engine Results Page)

Paid Search affiliates exist and they can be a great compliment to your brand.

This requires very clear parameters on keywords: brand and non-brand, bidding, and a highly competitive SERP.

When done well a trusted Paid Search Affiliate can:

1. Only be paid on purchases

2. Push down competitors in a crowded SERP

3. Enable additional customer education on your non-brand queries and provide consumers with more exposure to your brand in the consideration phase of the buyer journey.

4. Align with your brand on spend and bids to not outrank you or cannibalize your brand queries.

SEO is a primary lever for affiliates to promote their sites and often allows them to show up in the search results for brand + term.

An efficient well-run Paid Search program can complement this and ensure you are getting the best of both worlds and not missing Search which is a critical piece of the performance marketing puzzle.

The Duopoly is Real (+Amazon) 🏈 ⚾️ + 🏀

Google and Meta now make up about 50% of the digital marketing spend 🥵

Is Google the best demand capture mechanism? Probably.

Is Meta the best demand generation mechanism? Probably.

But for E-Commerce brands, don’t forget about Amazon!

Tap the RBL Flywheel 🛞

It is the namesake of this newsletter so I hope you knew this was coming!

We have written about it before here, have you NOT been paying attention!? (just kidding)

The gist is this:

1. Build compelling tested and high-converting landing pages (implementing principles of UX, CRO, user voice, and data to benefit paid media) this increases the conversion rate

2. Conversion rate is a top consideration for affiliates and influencers when choosing what brands to work with since they are putting skin in the game to promote you. With a higher conversion rate, you will get more affiliate partners and improved results

3. Whitelisting: take the lovely things influencers and affiliates say about you and distribute that valuable content into your paid social ads.

Media Buyers on a Performance Basis 🧮

Wait, WHAAAAA?

Yes.

There is a pocket of high-quality media buyers that have extra time on their hands and want to run affiliate offers to earn more money.

Maybe they are not fully utilized.

Perhaps they were laid off.

Maybe they are consulting and have extra time.

They get paid like affiliates, and they run your brand on Google Meta and TikTok

Combine the best of both, remove the silos, and get improved learnings and results 🕺

Paid Media and Affiliate Marketing both fall under the umbrella of Reforge’s paid marketing growth loop. If you are looking at them separately and in silos, you are probably not thinking in terms of whitelisting. One can create content for the other.

While managing Google PPC is quite different than recruiting high-quality content sites. You need to look at the entire SERP and user experience to own that space versus your competitors.

Your customer does not care if they discover your brand on BuzzFeed, People Magazine, Google PPC, Wall Street Journal, an awesome mommy blogger, or email.

Far too often a short-sighted view and value approach is taken when reviewing the data or even worse transactions and payouts are double counted when a brand is not looking at attribution correctly.

If you look both combined with a multi-touch view you can actually get smarter by using better tools.

We can also help you save even further by consolidating to a single point of contact and ensuring data and learnings are shared between domain experts for the benefit of your brand.

Why does this matter? ⁉️

A lot of marketers and media buyers think that affiliate is ONLY “pay for performance.”

The reality is there are a lot of media buys that behave more similarly to programmatic channels or a more traditional digital ad buy.

Use this to your advantage and combine creative content power on both and get more efficient with a multi-touch and multi-channel view of attribution.

Utilize paid media as a % of your affiliate marketing mix and don’t be afraid to test out media buyers on the sidelines looking to earn more with the right parameters.

Our team likes to aim for an over 80% success rate in making paid placements within the affiliate channel that are ROI positive for brands. Not all will work but most will.

This might help in putting a highly measurable rocket booster on that ocean liner that is your affiliate program!

What to do if this interests you 🥤

1. Talk to your media buyer about working with a high-quality publication (Sports Illustrated, People, Buzzfeed, or a macro-micro influencer in your vertical) to see what kind of impact they can drive by combining paid + affiliate campaign

2. Take these suggestions for a spin and let me know what you find!