Partnerize CMO Jim Nichols has published a byline in Forbes, entitled Three Things Retail CFOs Need To Know About Partner Marketing. The article outlines key points for CFOs who want to learn more about this fast-growing channel from a financial perspective.
Here’s an excerpt from the piece:
I work for a technology company in the partnership space, and over the past year, we’ve received more and more inquiries about partnership from pure-play digital and “brick and click” retail finance teams. They want to understand the fundamentals of this sector and how it can affect their revenue and business processes.
In a recent survey our company conducted, we asked 1,200 brand leaders about partnership’s share of total sales. The results were impressive: 54% of those surveyed said that partnership drove more than 20% of their company’s total sales. It’s clear that this is a channel that can deliver real scale to those who fully realize the opportunity. So, here are three key takeaways for CFOs who are interested in the channel.
Revenue and costs for partnerships are predictable and controllable.
According to the 2017 IAB U.K. “Affiliate Marketing Study,” affiliate partnerships drive a return of 16 times the advertising investment. A big reason for this is that such partner programs are paid for on a cost-per-sale (also known as cost-per-acquisition, or CPA) basis. Brands pay after they see revenue, not before.
Further, other segments of partnerships that have traditionally been compensated based on activity — like the number of blog posts or mentions — are now moving toward the CPA approach. For example, it is now possible to work with many influencers on a CPA basis just like you would do with an affiliate.
Read the rest of this article here.