This year’s only Affiliate Management Days show is just only 2.5 weeks away, and today I’d like to bring you an interview with yet another one of the conference’s speakers, Sarah Bundy. Check out her insight into the management of affiliate marketing programs below.

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Sarah Bundy is an award winning digital marketing strategist, affiliate marketing specialist, consultant, trainer and author. She is founder & CEO of All Inclusive Marketing, an award winning performance marketing agency delivering innovative, experience driven results that reach, engage and convert new buyers online.

Question: If you were to emphasize one important issue that every affiliate manager should be paying more attention to, what would it be and why?

Bundy:  We could go into details about FTC disclosures, attribution opportunities and major gaps in the market, however I’d like to reemphasize the importance of affiliate managers really needing to understand and pay closer attention to the very basic needs, both personally and professionally, of their affiliates individually and as segmented groups.

Affiliate managers often get caught up in the day to day “tasks” and more advanced topics of management, and try to bulk manage or automate the program to scale faster. This is often a huge misstep because they lose track both the key metrics of the program and of knowing the needs, wants and desires of their affiliates while maintaining meaningful relationships, which is what drives the best results.

When affiliate managers stop paying attention to the needs, wants and emotional drivers of their affiliates, that’s when programs suffer most. To counter this, affiliate managers can put more resources on a program because as they grow, one affiliate manager just can’t do it all. Luckily there are some great agencies, OPMs and consultants who can become an extension to the affiliate management team, so the most important part of having an affiliate program, the relationship and ability to fill an affiliate’s needs and desires, is consistently met resulting in true program optimization and growth.

Question: What do you see as the main areas of opportunity for online, in general, and for affiliate marketers, in particular in 2015 – 2016?

Bundy:  Aside from the most obvious advancements in mobile and data, one area I see having more significant play in 2015 -2016 is in Native Advertising.

Native Advertising is going to have more presence and exponential growth because of its ability to reach, engage, and convert highly targeted audiences with controlled messaging and guaranteed placement on high profile sites. Currently advertisers pay PR, content or social media firms millions per year in the hopes their articles and content will be picked up by recognized media outlets and high profile bloggers. However that content doesn’t always reach the right audience (or it’s too broad), the message can be contorted to tell a different story than originally desired, sometimes negative or damaging to brand reputation, and placement is never guaranteed.

With Native Advertising, both the publisher and the advertiser gets the exact desired content for their audience distributed while the reader has access to highly relevant content specific to their lifestyle and personal interests. The advertisers get guaranteed placement, and the publishers get guaranteed money in the door.

Because of this, I see Native Advertising being one of the most powerful performance marketing strategies taking the stage in the next two years.

Question 3: Between the fact that “affiliates are 7x more likely to be overwritten by another channel than another affiliate” and the fact that “30% of sales start on one device and finish on another” [source] how can an advertiser build a truly affiliate-friendly program, yet one that doesn’t cannibalize the merchant’s own marketing efforts?

Bundy:  Work with Impact Radius. Their technology can solve many of the tracking and attribution issues brands face in how to credit and value affiliate performance properly. The best management companies and brands will use them to look at the entire buying cycle and structure affiliate programs around different types of engagement and conversions, resulting in higher ROI across multiple touch points, a better understanding of different affiliate and channel value and allow multiple channels to be optimized to their full potential based entirely around sound data and multi-technology attribution touch points.

Question: In which ways can affiliates be adding value for the merchants they promote? And where does the “value” reside (new customer acquisition only or something more)?

Bundy:  I think affiliate value is determined by the key metrics that are most important to the brand according to their overall corporate goals and objectives.

For example, some brands use performance marketing to drive new customer acquisitions as their only priority result, which results in growing their customer database. Once acquired,  the brand then remarks to those buyers through email and other channels. They happily break even or sometimes take a loss to acquire the customer through the affiliate channel because their profits come from retention and an extended lifetime value of the customer, which are driven by other channels. In this case, the value the affiliate channel is brining is in growing the customer database vs growing net sales or profits.

Other brands will use affiliates to drive increased net sales versus just new customer acquisitions. For example, whether the affiliate is driving a new customer or not, the brand just cares about whether the affiliate drove new sales (in dollars) because they were able to convert buyers at a faster rate, or higher average order value because of their influence and particular marketing efforts. The brands themselves might be marketing to the same customer, however some buyers trust third parties or other influencers who are not exclusive to a brand more, thus they add value by increasing either the average order value or the conversion that the brand would otherwise not be able to convert on their own.

A final example (and there are far more) that affiliates can bring is just in simple brand exposure.  A growing company with little to no brand exposure, or a recognized brand who simply wants to dominate a market, can benefit greatly from having their consistent brand messaging and imagery across hundreds or thousands of sites at a much lower cost than in paying upfront for that placement. Because of the performance based model, if zero sales come in from these placements, it costs the brands nothing. If millions of dollars come in from this exposure and mass placement, the not only does that drive a company’s bottom line that scales, it is a controlled cost that comes only after the money is in the door (or another desired action takes place).

There are no other marketing opportunities online today that can achieve these same types of values with this type of cost control, which is why performance marketing is continuing to expedite. Brands need new customer acquisitions, profitable sales growth and increased brand explore which all add value in driving their bottom line.

Question: What is the biggest challenge faced by affiliate managers, and advertisers with affiliate programs, today and what would you recommend doing to overcome it?

Bundy:  Affiliate managers and advertisers with affiliate programs actually suffer from different challenges.

Affiliate managers struggle with finding time to do everything they need to for their program to grow, be monitored and optimized as much as they need to be for maximum results. They also often struggle with either getting approval from the “higher ups” to try new things in the channel or communicate the value the affiliate program brings to the company’s overall corporate goals or bottom line.

One of the ways affiliate managers overcome this is by getting outside help from agencies, OPMs or consultants to become an extension to them, so the program has the right (and enough) experienced resources to properly manage all the moving parts. These parts include everything from affiliate recruitment to outreach, to placement negotiations to compliance, strategy, reporting, relationship development, content creation and much more. With a well-rounded team who can be strong in all these areas (whether in house or outsourced) the program and the affiliate manager will see much stronger results and be able to prove that value faster.

On the flip side, the advertiser with the program (the brands themselves, usually in the form of the owner(s) or executive management team) struggle with driving profitable sales growth and new customer acquisitions fast enough as a whole.  They need to justify the time and cost of running the affiliate program compared to other channels within a controlled budget, and need to see constant growth to justify investment in this area.

To their detriment, and because it’s often misunderstood, brands too often dedicate less resources than needed to the affiliate channel and look at it as a second or third tier sales driver. In comparison, brands usually understand the immediate value of search or social as an alternative. Additionally, because content and brand reputation often leaves the hands of the brand and is in control of the affiliates, there is fear of brand dilution or misrepresentation by the affiliates.

With the right resources in place and often with the help from an outsourced program management firm or team, brands can drive incredible value and results through their affiliate program, all positive, and all a direct contributor to sustainable, profitable growth in several capacities.   Their challenge is true for all marketing channels they manage, and therefore affiliate is just a piece of this.  With a well-managed program that has enough resources, and depending on the size of the brand, the affiliate channel can often drive anywhere between 10-50% of a company’s profitable sales.

Question: Why do you think affiliate managers should attend Affiliate Management Days?

Bundy:  This is my fourth year attending (and speaking at) AM Days and I’ve found value in each show I’ve attended. The depth of content shared here is more suited for an intermediate to advanced level affiliate manager or digital marketer, which is great because often times the content at other shows is too basic to drive true professional development in this area.

Further, if you were to take all the thought leaders in affiliate marketing management and put them in one room to have meaningful conversations with, this would be it. It’s an intimate show that’s designed for more advanced collaboration, education and networking so affiliate managers who want to get better at what they do can.

SNEAK PREVIEW: Please tell us a takeaway that you will provide during your presentation at Affiliate Management Days.

Bundy:  One major takeaway from my session will be how to identify new opportunities for growth and optimization with graphical data and analytics. We’ve built a visual reporting system and will be sharing some case studies around key metrics and KPIs that will help affiliate managers lead to even more success in their programs.

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With Affiliate Management Days 2015 less than three weeks away, sign up now to look forward to Sarah Bundy’s participation at the upcoming conference in San Francisco. Be part of what she describes as “…[taking] all the thought leaders in affiliate marketing management and [putting] them in one room to have meaningful conversations.”