Over the past decade, the strategic positioning of affiliate within the marketing funnel has undergone a significant transformation. Once primarily confined to driving lower-funnel conversions through incentives like cashback and coupon codes, the channel has demonstrably evolved into a comprehensive, full-funnel asset within a brand’s marketing ecosystem. This evolution has proven particularly advantageous for content partners and influencers, who have found the affiliate channel to be an accessible and mutually beneficial avenue for collaborating with brands. Critically, the inherent robustness of affiliate technology’s tracking capabilities facilitates seamless integration and provides real-time performance insights, empowering brands to precisely discern how and where affiliate activity influences customer behavior throughout their journey.
As it becomes easier to track upper-funnel activities through affiliate partnerships, many brands naturally want to pay for these efforts on a CPA (Cost Per Acquisition) basis. However, in a truly effective, full-funnel affiliate campaign, many partners play a vital role as different touchpoints along a customer’s journey, all working together to lead to a purchase.
The challenge is that a traditional last-click commission system tends to give much higher payments to partners involved in the later stages of the buying process. Because of this, many upper-funnel partners need flat fees, either in addition to or instead of CPAs, to keep their businesses going. These fees can sometimes be quite high, depending on the region, how competitive the market is, and the limited space available for promotions in articles or on social media.
As brands aim to include more upper-funnel partners in their marketing plans, they need smart ways to reward these partners without hurting the performance of other parts of the sales funnel. Options like split attribution CPAs, CPC (Cost Per Click), CPM (Cost Per Mille/Thousand), and flat fees are all excellent methods to ensure content and influence are recognized, all while keeping the rest of your funnel strong.
Given that the affiliate channel has historically relied on a last-click CPA model, these newer ways of crediting partners might seem unfamiliar and could make some brands hesitant. However, when you consider how other marketing channels operate, adopting these flexible payment structures for affiliate really becomes a no-brainer.
Don’t hesitate to invest across all stages of a customer’s journey! Brands routinely allocate budgets for social campaigns, targeting similar users to boost traffic, conversions, and loyalty, without a second thought about assigning funds for each funnel stage. Likewise, they set aside budgets for Google ads targeting their own brand, competitors, and specific product keywords, happily paying a CPC for every click a customer makes. So, why should affiliate marketing be treated any differently?
While understanding customer behavior and making data-driven decisions through holistic attribution remains crucial, our thinking must evolve as the industry shifts. Download our latest ebook to know more on how brands and advertisers can get creative with their marketing strategies and optimize partnerships for a full-funnel solution.