Understanding Affiliate Networks and Choosing the Right Ones

Finding suitable affiliates can be a time-consuming and costly process, draining valuable resources. However, a more efficient approach would involve collaborating with an intermediary who can connect you with partners willing to promote your offerings. Such intermediaries, known as affiliate networks, specialize in facilitating this type of partnership.

By joining an affiliate network, you can swiftly and effortlessly have your product endorsed by multiple individuals who have a certain level of recognition. Nevertheless, it is crucial not to hastily register with the initial affiliate network you encounter. Several factors need to be taken into account before selecting the most suitable company for your needs.

But first, let us go through the basics:

What is Affiliate Marketing?

Affiliate marketing is a performance-based marketing strategy in which businesses reward affiliates for driving traffic or generating sales or leads. It is a mutually beneficial arrangement where affiliates promote products or services on behalf of a merchant or advertiser and earn a commission for each successful referral or conversion they generate.

Affiliate marketing operates on a revenue-sharing model, with affiliates typically utilizing various marketing channels such as websites, blogs, social media, email marketing, or online advertising to promote the merchant's offerings. When a user clicks on the affiliate's unique tracking link and completes a desired action, such as making a purchase or submitting their contact information, the affiliate is credited for the referral and receives a predetermined commission.

This marketing model provides benefits for both merchants and affiliates. Merchants can expand their reach and tap into new audiences without upfront advertising costs, while affiliates have the opportunity to monetize their online presence and earn income by promoting products or services that align with their niche or interests.

Affiliate marketing has gained popularity due to its cost-effective nature, performance-based rewards, and the ability to track and measure results accurately. It has become a prevalent method for businesses to drive online sales, increase brand awareness, and establish strategic partnerships with influential individuals or content creators in various industries.

What are Affiliate Networks?

Affiliate networks are platforms or intermediaries that connect merchants or advertisers with affiliates who are interested in promoting their products or services. These networks act as a bridge between both parties, facilitating the establishment of affiliate partnerships and providing the necessary infrastructure to track, manage, and optimize affiliate marketing activities.

Affiliate networks serve as a centralized marketplace where merchants can showcase their offerings and attract affiliates to join their programs. They offer a wide range of products or services from different merchants, allowing affiliates to choose the ones that align with their audience and marketing strategies.

For affiliates, joining an affiliate network offers several advantages. They gain access to a diverse selection of products or services to promote, simplifying the process of finding suitable offers. Additionally, affiliate networks provide tracking and reporting tools that enable affiliates to monitor their performance, track commissions earned, and analyze the effectiveness of their promotional efforts.

On the other hand, merchants benefit from affiliate networks by leveraging their existing network of affiliates. They can reach a larger audience and tap into the expertise and promotional channels of these affiliates. Affiliate networks also handle administrative tasks, such as tracking referrals, calculating commissions, and making payments to affiliates, streamlining the management of the affiliate program.

Factors to Consider When Choosing the Right Affiliate Network

Here are nine factors you should consider when choosing an affiliate network:

1. Fees and Binding Agreements

Avoid affiliate networks that require starting fees or fixed monthly fees. Affiliate marketing operates on a performance-based model, where the network earns revenue by driving sales to your site. Networks demanding upfront fees often indicate a lack of confidence in their ability to generate profitable traffic. Opt for a different network and avoid committing to binding agreements exceeding three months. The cost of starting an affiliate program isn't excessive, and if you're dissatisfied, there's no need for prolonged obligations.

2. Competitors

Contrary to popular belief, don't shy away from affiliate networks utilized by your competitors. Actively seek out networks where your competitors are present. This indicates the likelihood of finding relevant and valuable publishers within those networks. Join the same network and offer an appealing affiliate program to attract established publishers.

3. Choosing the Right Company

Exercise control over the brands and businesses associated with the affiliate network. Create a publisher account and review the offered affiliate programs. Does the network collaborate with industries that align with your brand? Consider the potential impact of your brand appearing in the same newsletters or blog posts as those related to adult content or gambling. Additionally, assess the network's partnerships with larger, reputable brands, as they tend to attract high-quality publishers that may be of interest to you.

4. Emphasize Quality over Quantity

While affiliate networks often boast about the number of publishers or websites in their networks, it's essential to prioritize quality over quantity. Evaluate whether publishers undergo evaluation before joining the network to ensure relevance and quality. In some networks, this responsibility may fall on you as the advertiser, potentially resulting in an influx of applications from irrelevant or foreign publishers.

5. Transparency

Be cautious of "black box" networks that lack transparency regarding traffic sources and affiliated publishers. It's crucial to know the origin of your traffic and determine which affiliates are generating compensation. Successful affiliate programs cultivate strong relationships with their publishers. Ensure that your chosen network:

Clarifies the sources of traffic and publishers connected to your program.

Enables you to choose the publishers affiliated with your program.

Specifies the orders for which you receive invoices.

6. Technical Aspects

Inquire about the affiliate network's tracking and reporting techniques. Is their system proprietary? Where is the development conducted? Some networks use platforms developed in the US, while others rely on ready-made solutions from international third-party providers. These systems may be less tailored to the Nordic markets, limiting the network's ability to develop new functionalities.

7. Private Individuals

Certain affiliate networks only allow company accounts and do not accept private individuals as publishers. This may exclude certain types of publishers like bloggers who typically operate independently. If blogs are an essential sales channel for you, ensure that the affiliate network permits private individuals as affiliates.

8. Support

Maintaining open communication with your affiliate network is vital. Evaluate their responsiveness to email inquiries, including evenings and weekends. Test their support system by submitting a support case after registering as a publisher or sending a request to become an advertiser via their website. Delayed responses indicate a potential risk of poor customer support.

9. Background Information

As with any business partnership, conduct due diligence on the company operating the affiliate network. Review their annual report to assess their financial stability and confirm their claimed size. It's also important to ensure they have local employees in markets that are significant to your business.

If the invoicing company is located abroad, VAT considerations may arise. If your business is VAT-free or falls under a mixed VAT category, you are responsible for remitting VAT to the Tax Agency, even if the foreign company issues an invoice without VAT (reverse charge). In other words, VAT cannot be avoided.

Comparing Two Leading Affiliate Networks

Now, let us compare the strengths and weaknesses of two of the top affiliate networks.

Commission Junction

Pros:

• An extensive network of affiliates
• Comprehensive reporting system
• No additional charges for sending newsletters to existing affiliates
• User-friendly interface for searching and discovering new affiliates
• Option to automatically approve or decline affiliates based on specific criteria
• PayPerCall feature for boosting sales
• Responsive customer support team
  
  

Cons:

• High setup fee for joining the network
• Monthly minimum transaction fees are set at a relatively high threshold ($500)
• Transaction fees higher than the industry average (30% of commission)
• Historical reports accessible for a limited period of up to one year
• Additional costs involved in implementing product.
  
  

ShareASale

Pros:

• Reasonable setup fee ($550)
• Low monthly minimum transaction fees ($25)
• Lower transaction fees (20% of commission)
• Detailed reporting capabilities
• No extra charges for setting up a product feed
• Attentive and responsive customer support team
  
  

Cons:

• A smaller pool of affiliates compared to other networks
• Limited search functionality for finding new affiliates within the interface
• Reports need to be exported as pipe-delimited files for analysis
  

Final Words

In conclusion, understanding affiliate networks and selecting the right ones is crucial for success in affiliate marketing. These networks serve as valuable intermediaries, connecting merchants with affiliates and facilitating mutually beneficial partnerships. By considering key factors such as reputation, network reach, commission structure, support, transparency, and quality of affiliates, advertisers can make informed decisions.

It is essential to opt for affiliate networks that align with your brand, offer a diverse range of relevant products or services, and provide robust tracking and reporting capabilities. Additionally, prioritizing networks that foster transparency, enable direct communication with publishers, and have a reputable background enhances the overall effectiveness of your affiliate program.

Remember, affiliate marketing thrives on building strong relationships, leveraging quality affiliates, and continuously optimizing your strategies. By carefully assessing and selecting the right affiliate networks, advertisers can unlock tremendous potential for driving sales, expanding their reach, and cultivating long-term success in the dynamic world of affiliate marketing.

TheAffiliatePlatform by Smartico.ai: A Dedicated Solution For All Your Affiliate Marketing Needs

Powered by Smartico.ai, TheAffiliatePlatform is a comprehensive software solution that allows for multi-brand campaign creation and tracking while keeping each brand's affiliate registrations and access separate.

With this affiliate system tailor-made for online casinos and sports betting, you can build strong partner relationships and expand your affiliate network on your terms. Its flexible tools can also help you optimize your affiliate marketing spending with surprising efficiency.

This white-label platform is designed specifically for casino, poker, sportsbook, and fintech operators.

In addition, TheAffiliatePlatform offers the following features and benefits:

• Collaboration With Partners — Dedicated Account Manager is part of the service via any of the instant messaging apps (Slack, Skype, Teams) and Jira.
  
  
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• Total Control In One Customizable Platform — Tap into the power of a fully customizable affiliate management solution designed to manage your affiliate marketing campaigns, payouts, creative assets, and more. Upload, update, and manage all your creatives across your entire affiliate network.
  
  
• Track Everything In One Place, Build The Partnership You Want — TheAffiliatePlatform can make your next campaign the most successful one yet. It is a powerful affiliate software platform bringing casino and betting operators advanced solutions for creating, running, and tracking multi-brand affiliate marketing campaigns.
  
  
• Comprehensive Feature-Rich Tracking — TheAffiliatePlatform provides real-time and accurate conversion tracking and records via API integration, FTP solutions, traffic sources, and media placements. It also features broadly advanced no cookie dependencies methods like Server 2 Server (S2S/Postback), Image pixel, iFrame, Client JS Block and Facebook pixel, which are ideal for advanced affiliate marketers.
  
  
• Multi-Product & Multi-Brand System — TheAffiliatePlatform allows for multi-brand campaign creation and tracking and keeps the affiliate registrations and access separate for each brand. Different commission plans can be assigned per product and brand. Unite your iGaming brands into one affiliate program and manage them from one admin panel.

TheAffiliatePlatform offers many more tools, and, driven by customer requests, new features, and functionalities are released every month. Please schedule your free in-depth demo below.

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Remember to choose the tools that align with your specific tracking and measurement needs, budget, and technical capabilities. It's also beneficial to experiment with different tools and find the ones that work best for your affiliate marketing strategies.

TheAffiliatePlatform team wishes you the best of luck on your journey in affiliate marketing!