Why attribution modelling is failing affiliate marketers

There is a single word that guarantees a sea of weary groans from affiliate marketers whenever it is mentioned – that word is ‘attribution’. It’s not that it is unimportant, on the contrary it is pivotal if we are to better understand the work we all do. The problem is that the typical framing of the conversation  around attribution does such a disservice to our industry.

Affiliate marketing is a much misunderstood discipline predominantly for two reasons. First, people outside the industry see it as a single channel. Certainly, when we are presented  with reports from third party analytics companies, commissioned by brands to help them optimise their marketing budgets and assess the effect of their digital channels, affiliate is typically a single line in the reporting – a homogenous channel with no shades of grey.

Those of us on the inside looking out see things quite differently. Affiliate marketing is digital in microcosm, every discipline you can think of, a broad church unified by a common payment metric. And this is a problem, it’s a channel defined by its commercial model, rather than the activity that sits behind it.

The second sticking point surrounds the ‘last click’ conversation:it is an undeniable fact that a channel premised on conversions, when crudely modelled, will always take disproportionate credit for the sale. If activity is rewarded almost exclusively on a ‘no win, no fee’ basis, of course it has to deliver.

Those focused on attribution will say social media and display activity is (typically) under-acknowledged in any path to purchase, with affiliate the brazen goal hanger perpetually swallowing up the credit in a zero-sum game.

Of course, we have to consider paths to purchase and how marketing channels influence at different stages. Assuming we are primarily focused on the measurable act of someone buying something, we will naturally want to understand the touchpoints that ultimately drove them to part with their hard-earned cash. In an increasingly complex digital ecosystem, it’s also not uncommon for consumers to interact with multiple sites across a variety of devices.

Measuring the resulting transaction purely on the outcome will never give anyone a clear appreciation of the contributions at other stages, but similarly if we are tallying only clicks or impressions, this does little to further our knowledge either. Surely a click is an arbitrary measurement, no matter how many times it is counted? Besides, affiliates drive billions of clicks and impressions that never result in a sale. The cost to an advertiser for these is generally nothing because we are still wedded to our business model. And the assessed value of these interactions is generally never considered.

Take bloggers, the current in-demand darling of the affiliate channel, and price comparison sites. Both can legitimately claim to be premised earlier in the sale funnel, and last click cost-per-acquisition (CPA) does neither of them justice. Both generate significant traffic and acres of content that is never rewarded because it does not drive a conversion. Yet to many non-affiliate companies this traffic is indistinguishable from retargeters or basket abandonment technology that may sit within the affiliate channel. All are at risk of being lumped together as ‘affiliate’ when modelled against other digital disciplines.

So now is the time for affiliates to reclaim the debate and showcase their influence. It is time to forge ahead with commercial models that reward this unsung contribution. Underlying much of the discussion is also an acknowledgement that less tangible ‘value’ metrics need to be explored and understood. For a diverse, complex marketing channel that is defined by its commercial model, rather than its broad scope of activity, this adds a layer of work that requires time and investment. Advertisers also need to contribute, layering their post-transaction data with that of affiliates.

These metrics vary from advertiser to advertiser. Consider new versus existing customer targets, lifetime value, demographic consumer profiling, pages viewed and time on site for starters. Determining value as defined by a single metric or model, whatever that may be, starts to look inadequate for the job at  hand. Major telecoms companies have been at the forefront of this insight, for years showcasing how affiliate traffic drives, almost without exception, the highest quality long-term customers. If an attribution model shows these affiliates are also premised towards the sale, what should we do? Not pay them?

Perhaps it is time to challenge whether last click CPA is fit for purpose across the entire industry. Given that we have already stated that there is significant diversity within the traffic sources available, it makes sense for us to query whether a single payment metric does the job.

Fashion brands want to engage with influential bloggers who have armies of loyal followers. Telecoms brands, long-time exponents of substantial ‘tenancy’ deals, are always looking for deeper affinity partnerships. There is, on the whole, a growing desire to prove affiliate marketing is more than voucher codes and cashback.

So let’s bring on the alternative payment models, as long as we can measure everything back to an effective CPA and it delivers to return on investment targets. Surely, the position in the purchase path is unimportant from a cost point of view.

In response, we have launched ‘assist payments’, top-ups that advertisers can pass back to sites they know are more ‘influencers’ than ‘closers’ of sales. The added benefit is greater affiliate engagement and the halo effect of extra on-site branding, the  ‘free’ element of our channel that most, if not all, attribution models seem to neglect when modelling channel contribution.

Ultimately, much of this work is also academic without a nod  to the 50% of web traffic that is now flowing from tablets and handsets, which we are addressing at the moment with cross-device technology.

Fighting our corner and talking up the non-sales focus of affiliate activity will prove critical in the coming years. We will need to be creative and we will need to challenge the status quo: it is a necessary project that could secure the long-term sustainability of the affiliate channel.