Advertiser survey reveals a positive attitude to affiliate marketing

Earlier this month the NMA published new research carried out for AffiliateFuture by The ID Factor, surveying the attitudes of 105 UK affiliate advertisers. The results revealed many advertisers expect budgets for affiliate marketing to increase or stay the same through the current recession.

The report asked 10 questions and I am going to examine the answers and give you my opinion on each question posed.

1. What is the basis of the affiliate programme? The majority of affiliate programs are sale-based (77.8% with 22.2% lead based). Sale programs are ideal for affiliate marketing when the transaction occurs online. It allows for the tracking that is behind every affiliate marketing campaign to attribute commissions to the affiliate who drove the sale.

Lead based programs are also good for affiliate marketing. From my experience I have found that lead-based programs can require a lot more management. This is because there is often more administration involved with monitoring the leads due to the high number of fraudulent leads that can sometimes occur. This does not always mean that it is impossible to run a successful affiliate program; simply that it often needs more man hours.

2. What is the campaign budget? This question revealed that more than three quarters of the advertisers surveyed have an unlimited budget for affiliate marketing. It makes sense really: if you are only paying affiliates when you make a sale, why put budget restrictions in place?

3. Which channel has the best ROI? This question compared the ROI from affiliate marketing, email, PPC, and other channels. 44% of merchants surveyed chose affiliate marketing as the discipline which delivered their best ROI. This is not surprising as only paying out on a sale means you can control costs and account for every penny spent. This is particularly important during times of recession where accountability is key.

4. Planned changes to affiliate budget in 2009? It’s encouraging to read a third of merchants surveyed were planning to increase their affiliate marketing budget in 2009.

5. Satisfaction with number of leads/sales from affiliate? I think this was a particularly tough question to throw into the survey. What business is going to be totally happy with the amount of sales or leads generated? Surely most will always want more! Despite this only 16.7% of advertisers stated that they were unsatisfied.

6. Satisfaction with support from affiliate network? Affiliate networks usually have a huge number of programs and their Account Managers often look after a large number of advertisers. This is where an affiliate management agency can help out. An agency is very useful if you wish to run your program on more than one network to increase reach. Having a professional agency run your operations allows you to concentrate your efforts on your own business.

7. Satisfaction with quality of leads/sales from affiliates? Most merchants are satisfied with the quality of leads/sales that come through (only 11% unsatisfied). Once again, it begs the question: which business isn’t on the constant search for improved quality?

8. Paying for repeat custom from affiliates? How affiliates are remunerated is always in debate with the majority of merchants happy to pay affiliates within a 30-day period (61.1%).

9. Use of voucher codes? This is another hot topic. Voucher code sites are increasing in number all the time although some merchants are not prepared to offer vouchers. Some advertisers take the view that you could be giving a discount to someone who may have purchased anyway.

10. Awareness of IAB Guidelines on use of voucher codes? At the end of 2008 the IAB released guidelines about the use of voucher codes, but how many of those surveyed were actually aware of them? According to this survey, 60% were not.

It would be great to hear anybody else’s thoughts on the questions asked. Feel free to leave a comment below.

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