Spoiler Alert: They don’t HAVE to choose.
A recent online article, published by Entrepreneur, made my blood pressure rise. The author makes a comparison between affiliate and influencer marketing and asks the question, “Which should your company use?” At first glance, I thought the article was click bait. But as it turns out, many companies do feel they need to make a choice between the two. An online marketer recently shared with me that a company shut down their affiliate program to focus on influencer marketing instead. Huh? Why would a company think these two initiatives are so different that they can only use one?
The Entrepreneur article, plus that recent experience, led me to write this post. In this article, I address the ‘either or’ mentality. I further explain why affiliate and influencer marketing are compatible and work best when combined.
Definitions for Influencer and Affiliate Marketing
Let’s begin with basic definitions of each tactic.
According to the reputed SEO agency Home Service Direct, Influencer Marketing is a form of advertising in which focus is placed on influential people rather than the target market as a whole. It identifies the individuals who have influence over potential buyers, and orients marketing activities around these influencers. I like to think of influencer marketing as partnering with individuals who have credibility and knowledge that supports your marketing initiatives.
Brian Littleton of Shareasale provides my favorite definition of Affiliate Marketing by stating, “affiliate marketing is simply advertising, tied to a performance metric.”
In translation, affiliate marketing is a way to compensate influencers for their efforts. As such, it can be influencer marketing tied to a performance metric.
The Lines Are Blurred
By looking at these definitions, it is clear how the two channels can work together. In fact, the lines between affiliate and influencer marketing are continually blurred. Many influencers approach PR departments requesting to become an affiliate, especially if a flat sponsored rate is not available. Since this winning combination is the core of my business, I am confident it works. Why? Because affiliate marketing is a great way to compensate Influencer Marketing. Yes, I used the C word: compensate.
Below are two reasons why a hybrid influencer marketing model of affiliate and influencer marketing benefits both the influencer and the brand.
1. Influencers Should Be Compensated
Influencer marketing may be in its infancy but it has evolved beyond the days of running campaigns with free product as the ‘pay’. Yes, you may get a post or a social media shout-out in exchange for a free product, but it is rare to create a profitable campaign without offering compensation. Influencers know their value and the amount of effort it takes to make a campaign successful for a brand. A successful campaign includes one or more of the following:
• Blog post
• Social media posts
• Social media advertising
Does a brand produce these campaign assets for free? Absolutely not. There are copywriters, designers and marketing professionals involved. So, why should a brand expect an influencer to work for free? The answer is they shouldn’t.
However, providing compensation means influencers need to meet metric requirements from the brand. If a brand is paying for a campaign, they need to create KPI’s just as they would with any other marketing initiative.
2. Brands Need KPI’s
With this growth of professionalism in influencer marketing, brand expectations also rose. A successful influencer campaign measures beyond Likes, Views, and Clicks. Brands create KPI’s (Key Performance Indicators) based on targeted results. While brands may set some of their campaigns to focus on brand awareness, others have KIPs based on revenue. If this is the type of KPI’s your brand is after, why not select a compensation plan that rewards based on the performance of your objectives?
Now that you know the why’s of integrating these two channels, let me explains the how’s.
I recommend hybrid solutions to my clients that meet the evolving needs of both the influencer and the brand. The first piece of my hybrid solution morphed out of a sponsored post. I offer a flat fee for launching the campaign. The fee is structured to reward the influencers’ efforts prior to launch. This initial flat fee can be tied to bringing the campaign live or set as a bonus for a small number of sales. The second portion of the hybrid solution is the traditional affiliate/performance based model. Influencers receive a commission based on referred sales or brand determined metrics. I often include a second flat fee bonus, based on a mutually agreed upon goal, for further motivation. Your hybrid solution should be structured in a way that provides the influencer the best chance to reach their traditional sponsored posts rates with additional incentives to surpass expectations for superior performance.
Here is the six-point checklist I use to create a hybrid model:
• Evaluate the audience Ensure the audience will be receptive to your product and/or brand. Remember, size does not matter in this proposal. In many cases, the micro influencer will outperform the larger influencer.
• Get rate expectations It is important that both parties respect budgets and rates
• Work it backward As an example, if an influencer typically charges $1000 for a campaign, I would start off with a $250 flat rate for creating the content and an aggressive commission to ensure the influencers’ rate is attainable. Of course, the influencer rate needs to be aligned with your cost per order or customer as well.
• Set up a bonus for performance Affiliate marketing is performance marketing so you want to reward for superior performance. I set two bonuses that allow the influencer to earn beyond the rate expected to further incentivize promotion of your brand.
• Provide assets Ensure the influencer has everything they need to create a successful campaign. Many influencers are new to performance driven posts. I supply my influencers with a campaign asset page that has all the campaign collateral. In addition, I create resource centers for step-by-step technical directions.
• Follow up Affiliate marketing partnerships are long term. Follow up to evaluate what worked and what needs improvement. Discuss the timing of the next campaign and start the process again.
Number One Reason It Works
In addition to both parties having vested interests in the success of the campaign, the hybrid model focuses the influencer on the brands KPI’s. Both parties are clear about the goals of the campaign and work together to achieve these goals. The influencer writes content and promotes with this goal in mind by creating stronger calls to action. The brand provides the targeted assets based on this goal, and perhaps also offers a time sensitive reward for the audience in the form of best-selling products or key selling points.
The number one reason hybrid models work? Successful and quantifiable KPI’s result in higher marketing budgets, no matter what size your marketing department is. This has always been the case in marketing so why would it change with influencer marketing? Increased budgets for influencer marketing benefit both brands and influencers alike. The justification for a future campaign becomes easier with a clear ROI.
Have you run hybrid influencer and affiliate marketing campaigns? What were your results?