Why programmes fail and what to do about it

Why programmes fail and what to do about it

If brands think all they have to do is ‘build it and they will come’ when it comes to launching an affiliate programme, they have got another think coming, writes Lee-Ann Johnstone. Here she flags up two common failure points every brand must be aware of.

Published 19th November 2019

I consider myself fortunate. I’m lucky enough to run a business that gives me a really good INSIDER view of affiliate marketing. Did you see what I did there? AffiliateINSIDER is founded on the thing I’m most passionate about: affiliate marketing.

Every day I work inside the nucleus of this arena. I see it and experience it from all sides – as an agency, working with networks, using technology and talking to both affiliates and our clients. From delivering thought leadership content at events such as iGB Affiliate to gathering insights and planning complex strategy, it all centres around customer acquisition in global markets. I see behind the doors of many different businesses and it’s why I’m able to write about my learnings in this magazine. If you’ve met me, you’ll know that I’m extremely passionate about what I do.

I have a hands-on approach to digital strategy. I spend a lot of time reading up on affiliate marketing to ensure the programmes we work with are optimised. In doing so, I’ve learned that there are two common things that can impact why affiliate programmes typically fail or stagnate in growth. I’m going to share them with you here.

TECHNOLOGY – YOU CAN’T HAVE TOO MUCH OR TOO LITTLE

More often than not programmes get launched on technology that simply isn’t the right fit.

Affiliate programmes have a natural life cycle and when you get all the elements in each stage of the life cycle 100% right, your programme becomes profitable faster. It costs money to launch and market an affiliate programme and you need to consider this as an investment before you can expect to make any profit. It takes on average six to nine months to launch, scale and grow an affiliate programme into showing a profit.

Making a decision on what technology to use when you launch your affiliate programme is probably the first and most important one you have to make. Everything about your programme function will centre around your technology, from the data and the reporting you can extract for campaign analysis, through to the way your team uses the remuneration models available in said technology to manage and incentivise your growing database of affiliate partners.

Getting this wrong can have major impacts on your programme’s ability to scale and grow. It affects your profit margins and also the cost of resource time required to manage affiliate partners as the programme grows. All of these things need to be considered at the outset before you begin as they directly impact your profits. So how do you choose? This is a question I’m asked often.

There are a number of technologies available in our space to consider, as well as affiliate networks and the value they can bring. Each technology you look at will have a set of USP to consider, so deciding which one to choose can be daunting. The trick is to think holistically at what you need now and then judge what you’ll need in 24 months’ time as your business grows. Deciding which technology is 100% right for you is where having an expert in affiliate marketing by your side can really help. An expert will understand the functions of the individual products. They will then look at how the technology will fit in with your existing marketing objectives and match that to your future needs. They’ll also be able to consider the price points that would 2019work with your remuneration models to help you maximise your launch strategy.

Often we’ll see clients using a Rolls-Royce technology solution when a Mini Cooper one would suffice. Having too much tech eats into your revenue margins at the start of a programme. This misplaced spend effectively stops you having budget to negotiate better commercial pricing for exposure. Similarly, too little functionality makes it hard to get you off the startling block with a competitive programme offer. The issue with making the wrong choice at the start of your programme life cycle is that it’s incredibly difficult to migrate a programme to another platform after you’ve already launched. It’s not impossible but it is something best avoided.

BUDGETS, PLANNING AND A LITTLE PATIENCE

If your technology is the first step to launching properly, then having a good budget and a sound marketing plan in place with which to promote the programme is the second. Understanding how an affiliate programme grows in stature is quite important. A common misconception I see is brands thinking they’ll launch an affiliate programme and everyone will come running to join it. That’s simply not the case. I call it the ‘build it and they’ll come’ myth.

The market is competitive, so how are you planning to stand out? Well, you need to have a clear marketing plan to promote the launch of your programme. Usually this involves attending events; advertising on websites where affiliates are congregating; or investing in editorial, email or other online resources that will promote your programme’s benefits.

Allocating sufficient resources in the start-up budget to launch your programme is imperative to your success. Active marketing, 1:1 and mass outreach direct to affiliates, coupled with personalised relationship building, are the perfect conditions required to make growth happen. Affiliate marketing is a long-term investment as it takes at least six to twelve months to launch and grow a profitable affiliate programme. You have to give affiliates time to review you, your product and your brand, and test the waters. Nobody is going to jump right in unless you have a big budget to encourage them to swap inventory from suppliers who are already a known entity with their audience.

This is why you need to be consistent with your message, your offers and your service. It’s going to take time to meet and engage new affiliates and invite them in to your programme. There are no shortcuts – unless you have really deep pockets, which no one starting out ever does. This is why having a plan is important. It will help to ensure you are reaching the desired affiliate partners you want to work with, and that you are competitive enough to make them join your programme and personable enough build a direct relationship with you.

As for making plans, the problem with strategy is that it’s often misplaced. It only works when it’s also part of your holistic digital marketing efforts. Most of the time the affiliate team is not considered part of the wider marketing division. This is where things can get tricky in bigger businesses. The truth is that your affiliate team should be plugged into your regional country management and brand marketing divisions so that they can support the wider acquisition marketing piece. When this connection is made, beautiful things start to happen, pricing is leveraged across your group with partners, you all sing from the same hymn sheet and your strategy becomes laser focused on delivery and action.

Lastly, we come to patience. We all know it is a virtue, but you also need it when building an affiliate programme. Revenue growth is achieved over time by implementing a series of small precise tasks that impact the programme expansion. Affiliate programmes don’t launch and grow in a line graph style; they are more like the Fibonacci sequence, starting in a small spiral and then slowly expanding outwards in a circular motion as affiliate relationships begin to grow. Trust, a key part of business growth, is earned. Reputations cannot be built in just a few days, they are established over time with consistent, regular action.

NO BELLS, NO WHISTLES

I’m a big believer in keeping things simple. If you can work out the best start for your programme, keeping the two common failure points of technology and relationships in mind, you’ll already be well on your way to success. Affiliate marketing is one of the strongest marketing segments in your acquisition arsenal. You pay on performance and you get to work with a bunch of entrepreneurs who are agile, forward-thinking digital experts and who will complement your business. Embracing that as the starting point and coupling it with the correct choices on tech and strategy will allow you to build a successful affiliate programme that will drive your business growth forward.

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