Performance

New Models for Affiliate Marketing Attribution

a workplace at UDG

Article by |

01

How customer journey insights can be used to support affiliate marketing business models

For the performance marketing industry, attribution has long been a widely discussed topic viewed with great importance. Customer journey analysis gives valuable insights into dependencies and cross-contribution of all marketing activities used. We have seen the marrying of those insights with purely data driven marketing instruments such as RTB, to creating campaigns that automatically maximise ROI. The continued development of data, using programmatic technology to utilise said data, will continue to enhance the performance marketing sector during 2015 and beyond.
 
By design, customer journey contributions are not compatible with typical “the winner takes all” setups like the last-cookie-wins principle that is widely used in performance marketing nowadays. There are clear technical obstacles on this, as neither affiliate networks nor tracking systems employed are sufficiently equipped to handle customer journey contributions.
 
Also, all kinds of very popular publisher models such as loyalty and cashback sites would not work anymore in a customer journey setup. Not convinced? Then try to explain to a cashback user, why they are only getting a fraction of a promised cashback due to them previous clicking of different ads.
 
In that light, simple and transparent attribution models that always reward publishers with a foreseeable commission for any sale referred will continue to be needed.

Intelligent use of customer journey insights

How do you solve this? Rather than trying to force the full logic of customer journey attribution models onto performance marketing, the relevant learnings taken from customer journey analysis should be implemented in the commission models used. This can be done step by step in a structured process:

  • Categorise all publishers by business model (voucher, cashback, loyalty, price comparison, content etc.)
  • Track and measure the typical contribution in a customer journey context for each business model (using one’s own preferred attribution model).
  • Measure the true value of business driven by each model (using KPIs such as customer retention, new/existing customer, AOV, goods returned etc.)
  • Calculate an average commission for each business model, reflecting contribution and value measured.
  • Assign publishers individual commissions based on their business model.

Typically, this would result in reduced commissions for publisher models that are relevant towards the end of a buying process, such as voucher or cashback sites. By contrast, commission for content driven business models would go up, reflecting their higher impact in increasing levels of engagement with new customers.

Too complicated? Do it step by step

There is no need for a complex fully-fledged implementation of any sort, insights can be gained and used gradually. Every time new results and insights are available they can easily be implemented by simply adjusting the commission models used.

This article is an abstract of a feature that was first published on MyCustomer.

Daniel Schetter

About the Author

Daniel Schetter

Daniel Schetter has more than 15 years of experience in online marketing, being active in different positions in a start-up and a publicly listed enterprise. He is focused on marketing of products and services, applying a holistic strategy. As Managing Director he’s leading the Munich and London offices of UDG United Digital Group. Wolford garments are sold in over 270 company-owned or partner-operated boutiques in 60 countries, as well as in the company’s online store. UDG United Digital Group oversees Wolford’s online audience- based remarketing efforts.