When it comes to measuring marketing performance, incremental return on ad spend (iROAS) is often the gold standard. But for affiliate marketing, this metric can be misleading—penalizing a channel that plays a crucial role in the customer journey.
This is because affiliate programs only incur costs when they convert, while other marketing channels (like paid search or social ads) charge for every impression and click—whether they lead to sales or not. As a result, affiliates provide “free” exposure until the moment they drive a conversion, yet iROAS calculations fail to account for this earned media value.
If you’re wondering if your affiliate program is being undervalued, let’s break it down to find out.
The Problem: Last-Touch ROAS Undermines Affiliate Value
Most traditional iROAS models only credit the last-click channel that drives a sale. This creates a major blind spot for affiliate marketing, where partners like content sites, influencers, and review aggregators contribute throughout the funnel—but don’t get paid unless they close the deal.
Unlike paid search, display, or social ads (where brands pay for visibility), affiliate partners often drive brand awareness and customer consideration at no immediate cost. This means that affiliates may be driving value without being proportionally credited, as the advertiser gets earned media benefits from non-converting placements that aren’t accounted for in standard iROAS models. Since these touchpoints aren’t factored into standard iROAS calculations, the true value of affiliate marketing remains hidden.
Not Every Click or Impression has True Incremental Value
Of course, not all affiliate-driven traffic is incremental. Lower-funnel partners like cashback or coupon sites often intercept existing demand rather than creating new conversions. This makes it essential to differentiate between true incremental value and conversions that would have happened anyway. Effective incrementality testing must differentiate between true added value versus conversions that would have happened regardless. Advanced measurement techniques, such as multi-touch attribution (MTA) and marketing mix modeling (MMM), attempt to distribute credit across multiple touchpoints—but many companies still rely on outdated last-touch models that fail to capture the bigger picture.
How to Explain Affiliate Value to Your CMO & CFO
If your leadership team is questioning the incremental impact of affiliate marketing, here’s how you can reframe the conversation:
1. Affiliate Partners Influence the Customer Journey—Not Just the Final Click
Many affiliate partners play a crucial role in driving awareness and engagement long before a conversion happens. Content publishers, influencers, and review sites guide potential customers through the research phase, but their contributions go unrecognized in last-click models. However, traditional iROAS models underrepresent the impact of affiliates by focusing solely on final conversions, making it requisite to look beyond last click measurement methodologies.
2. Affiliate Placements Provide “Free” Exposure Until Conversion
Unlike paid ads, where every impression and click has a cost, affiliate placements generate brand awareness and consideration at no charge—unless they result in a conversion. This results in free exposure, and branding, also known as earned media value, which is an advantage that’s not reflected in standard iROAS models.
3. Suggested Adjustments for More Accurate Attribution
To ensure a fairer measurement of affiliate performance, consider these strategies:
- Adopt Multi-Touch Attribution (MTA): Assign partial credit to affiliate partners for earlier interactions in the customer journey.
- Media Mix Modeling (MMM): Leverage MMM to quantify the affiliate channel’s broader contribution, including its halo effect on other channels and influence beyond the immediate campaign window.
- Factor in Earned Media Value (EMV): Estimate the media value of affiliate-driven impressions and clicks that didn’t convert.
Bottom Line: It’s Time to Reevaluate iROAS for Affiliate
Affiliate marketing is often undervalued because it delivers uncompensated earned media value until the final conversion. To get a more accurate picture of its impact, brands should move beyond last-click models and incorporate MTA, and EMV.
By recognizing the full role affiliate partners play in the customer journey, marketers can make smarter budget decisions—and ensure their affiliate program gets the credit it deserves.
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