When a brand decides it wants to properly attack its marketing, it seeks out experts to help them do so. Sure, they may have a marketing manager in-house to oversee the marketing process but when they need heavy lifting in the form of an integrated advertising strategy that plays out across multiple media in multiple markets, they turn to an advertising agency.
It's no different when a brand decides to enter the affiliate marketing channel.
Many merchants entering the affiliate channel believe a workable solution is to delegate all affiliate marketing responsibilities to an in-house affiliate manager and/or hook up with an affiliate network's managed services offering. But an affiliate manager is just one person and an affiliate network is just a platform, a technology provider and not a marketing expert. Much in the same way Google Search is a platform for search engine marketing and does not offer search marketing expertise.
Neither solution is the best solution for a merchant who truly wants to maximize returns through the affiliate channel. Let's take a look at several reasons why a merchant should consider an affiliate marketing agency for its affiliate marketing program.
Turnover - An affiliate marketing agency is stable in the sense that it is a corporation that consists of many people who work as a team to accomplish effective affiliate channel management for merchants. Yes, people come and people go but the team stays in place. While a great affiliate manager aims to do the same great things as an agency, they are just one person, not a team. And when they leave, and they will, the merchant, effectively, has to go back to square one.
On average, affiliate managers -- like any one in any marketing professions -- last about 14 months before they move on to their next gig. And when they do, most of the processes, procedures, practices and amassed knowledge disappear with the exiting affiliate manager.
Continuity -- Akin to the aforementioned turnover, continuity, as it relates to merchant revenue, can be lost. When an affiliate manager leaves a merchant, it's a dramatic revenue disruption. Processes, procedures, practices and knowledge leave when the affiliate manager leaves and a new affiliate manager must get up to speed of be trained.
While that is happening, the merchant's affiliate program is not running at 100% and that can lead to a disruption in revenue. Existing relationships with affiliate networks that have been built up over time with the in-house affiliate manager walk out the door along with the exiting affiliate manager and the merchant has to build those relationships all over again.
Expertise -- With an affiliate manager, you get a warm body in a chair who is lucky if they can keep up with anything more than the very mechanical aspects of managing a merchant's affiliate channel. This is not meant as a disrespectful jab, simply an observation that an affiliate manager is one person, not a team. An agency gives you a team of experts who are adept at optimizing campaigns, customizing creative, building and maintaining relationships with affiliates and networks.
Clout -- If an affiliate can have a phone call with an agency and bang out a program with 200 retailers at the same time versus have a phone call with one affiliate manager at one retailer, who do you think that affiliate is most likely to answer the call from. This is a serious stumbling block with the in-house affiliate manager model.
Agencies have clout. Just like any large entity in any segment of marketing or the broader business world, they can get stuff done because they have a much bigger reach and a larger command of the affiliate channel. An in-house affiliate manager simply lacks the bandwidth to do everything necessary to run a full blown affiliate program.
Cost Effectiveness -- When a merchant hires an individual affiliate manager, they are taking a risk in that they don't always know what they are getting. When an agency is hired, it's a simple fee. With an in-house employee, there's benefits, vacation, sick days, bonuses, training costs and other unforeseen costs.
In addition, agencies are on 24/7. Certainly an individual affiliate manager can work their ass off but, again, they are just one person, not a team like an agency.
And then there's cost-related risks. Is the affiliate manager exceptional? Are they just OK? Or are they terrible and will need to be replaced in 6 months? With an agency the proof is in the portfolio and tenure of clients. Sure, an agency can suck too but there are more solid metrics on which to judge that agency.
Experience -- A single affiliate manager has a limited set of experience. That just comes with being a single person. An agency brings to the table a stable of experience, an overlapping army of expertise spanning many years working with many different merchants, networks and affiliates. Yes, people can come and go from an agency just like affiliate managers come and go from merchants but an agency team can retain the collective knowledge much more effectively than an individual person. With an agency, a merchant gets continuity of experience.
What about Network Managed Services? -- Yes, networks can bring scale to a merchant's affiliate program but there are limitations. Chiefly, the merchant only has access to the affiliates in its network. That's limiting if the merchant wants to explore all options.
And then there's the question of strategy. If a network offers strategic advice to a merchant, it's questionable at best. Why? Because any advice that network gives is going to involve pointing the merchants money right back at the network whether or not the network's solution is best for the merchant. The network has no motivation to seek out and discover options outside its network that might be a better strategic direction for the merchant.
As a merchant, you want the best possible return for the affiliate channel. To get the best possible return, a merchant has to be able to get an unbiased, 50,000 foot view of the affiliate channel and, in addition, reliable, consistent expertise that will never walk out the door and sap affiliate channel revenue.
This guest article was written by Greg Shepard, CEO of affiliate agency AffiliateTraction.