How Affiliate Marketing Works
What turns the gears behind the global affiliate marketing machine? From dirty links to APIs and the future of privacy, this guide breaks down everything you need to know about how affiliate marketing and technology work in 2021.
Affiliate marketing is a massive channel for eCommerce and digital marketing. A Forrester study found that 81% of US advertisers they surveyed have an affiliate marketing program. Notably, the National Retail Federation (NRF) found that 38% of retailers consider affiliate marketing one of their top customer acquisition channels. The industry shows no signs of slowing in 2021, either. Consumers look for trusted sources (i.e., affiliates) to help them find products that reflect their values and meet their needs.
But with so many brands and publishers involved in affiliate marketing, how does the industry work? How do brands and publishers find each other and agree to work together? How do monetized affiliate links get onto publishers’ pages? How should data and links be handled?
Lately, cookies — data used to identify a computer — have been all over the news, and some question whether they’ll be part of the long-term eCommerce landscape. How will that impact affiliate marketing? What about General Data Protection Regulation (GDPR) and the rising pro-privacy movement?
We’ll cover how affiliate marketing works, the technology that makes it possible, and why — more than any other form of digital advertising — it is positioned to adapt to privacy changes. Throughout, you’ll also find tips on how to make your affiliate marketing streamlined, efficient, and easy with an affiliate deals database.
Chapter 1: Affiliate Marketing for Merchants: How to Get Started
In eCommerce, one of the biggest hurdles for merchants is connecting with the right audience. If you put your product or service in front of the right people in the right context, you stand a better chance of making sales. An e-retailer that doesn’t have an affiliate program is basically leaving money on the table.
Click here to learn more about how to start your own affiliate marketing program.
Chapter 2: How Affiliate Marketing Works With FMTC
Affiliate marketing has four main parties: the merchant (aka advertiser), the network (aka tracking platform), the publisher (aka affiliate), and the customer. Each merchant and publisher works with thousands of counterparties to put the right links in front of the right customers. The volume of data transferred through this system — not to mention the conversion mechanisms, tracking, and tools that facilitate it — is staggering. Publishers struggle to manage it all, especially if they’re not using the right platform.
Here’s a look at how FMTC’s API-connected affiliate content database makes affiliate marketing programs easier to manage.
Chapter 3: Affiliate Marketing for Publishers: 5 Ways FMTC Makes It Easy
Affiliate marketing for publishers means managing information from multiple channels — cleaning it, sorting it, and making sure it runs in the right places. These best practices will make affiliate marketing management easier, faster, and more efficient:
Click here to read our tips on how to manage your affiliate deals.
Chapter 4: How APIs Fuel More Efficient Affiliate Marketing
The affiliate marketing ecosystem scales on data feeds. The affiliate marketing ecosystem scales on data. Merchants enter deals and products into affiliate networks. These networks connect with publishers, who then get affiliate links from network feeds. But this system is fragmented — merchants, networks, and publishers process too much information from too many sources.
With API integration, FMTC can centralize affiliate links, deals, and products from thousands of merchants across networks. We verify, categorize, and deliver links to merchant-approved publishers.
Click here to see how our APIs make that possible and enhance the whole ecosystem.
Chapter 5: Affiliate Links: Cleaning, Categorizing, and Testing
In a perfect world, an affiliate link is free of typos, link errors, and irrelevant categories. But in reality, cleaning links is an essential step in any successful publisher’s affiliate program. Publishers spend resources on proofreading copy, correcting categories, and checking links for errors.
FMTC solves this problem for publishers by reviewing and fixing every link before it is added to our database.
Click here to read more about how our human data processors work and what it means for your affiliate marketing program.
Chapter 6: Do Affiliate Links Rely on Third-Party Cookies?
You may have heard that Google Chrome and other browsers are ending support of third-party cookies, which will make it harder to track and target ads. Will this impact affiliate link tracking?
While the industry relies heavily on browser cookies, third-party cookie bans are not as threatening as they appear. That’s because affiliate marketing is done almost entirely with first-party cookies placed by direct web visits.
Click here to learn the difference between first- and third-party cookies and why it could be important to the future of digital advertising.
Chapter 7: Affiliate Tracking: How We Know Your Click Led to the Sale
Tracking and attribution are vital to any affiliate program. For some publishers, their biggest fear is publishing a link but not getting credit for the conversion. For merchants, a sure way to lose your best affiliates is neglecting to pay a publisher for a conversion.
How can you be sure the right affiliate is getting credit for the conversion? It all comes down to a technology tracking layer that reports to affiliate networks and tracking platforms.
Click here to learn how affiliate link tracking works and why it’s normally unaffected by third-party cookie bans.
Chapter 8: Pixel vs. Server-Side Tracking in 2021
We once debated whether server-side or client-side (browser) tracking was the better option for attributing affiliate link conversions. Team Cookie won that debate, and we’re still mostly using them today.
However, server-side tracking (also called postbacks, or postback URLs) has a lot to offer. It gives merchants and networks control of the data. Server-side tracking also works better with mobile devices, which often block cookies by default, and is more resilient in the face of privacy regulation changes.
Click here for a look at how these technologies work and whether it’s time to change to a server-side affiliate tracking standard.
Chapter 9: The Top 5 Affiliate Marketing Pain Points
Affiliate marketing typically begins with affiliate networks. But as your program, content, and partnerships grow, so does the complexity of your affiliate marketing program. Managing that growing ecosystem can quickly overwhelm in-house resources. This applies to both sides of the affiliate marketing relationship. Merchants and their affiliates struggle to manage their programs, find new partners, and get the right links to the right people — while grappling with their return on investment (ROI).
Here’s a look at the five most common pain points in affiliate marketing and how to get them under control.
Chapter 10: Easy Affiliate Marketing Management With FMTC
FMTC brings merchants, publishers, and deals from the 23 top affiliate networks together into one clean, fast database with a streamlined interface. Whether you’re a merchant or publisher, this platform makes managing your affiliate program easier and more efficient than ever.
Click here for a look at what we do and how the FMTC database makes managing your affiliate marketing effortless.
Chapter 11: Troubleshoot Your Affiliate Marketing With FMTC
Affiliate programs have a lot of moving parts, which leave room for things to go wrong. If you’re noticing an issue, one of these five common problems may be the cause.
Click here for a look at five common affiliate marketing problems that could be hurting your program and how you can resolve them.
Chapter 12: How Will Cookie Bans Impact Affiliate Marketing?
For the most part, affiliate marketing does not use third-party cookies. However, as privacy movements gain steam, so do efforts to prevent cookie customer tracking entirely.
Click here to learn how affiliate marketing would fare if cookies went away tomorrow.
Take the Next Step
In these chapters, we laid the groundwork for how affiliate marketing works. If you’re ready to take the next step in making your affiliate program management faster, easier, and more profitable, contact us to set up a free trial of FMTC.