Editorial Articles

Affiliate marketing is spreading across the globe. Where once affiliates and networks operated solely in one country or region, they are now increasingly driving traffic and earning commissions around the world from the comfort of their own home or office. In particular, many affiliate networks based in the US are looking to expand into Europe and vice versa. The trend towards global affiliates is still in its infancy, but it’s certainly causing challenges for affiliate managers. What’s more, the digital nature of this industry has led to a situation where anyone can effectively become an affiliate regardless of location. This raises issues such as language and currency barriers which have not traditionally been a major concern for affiliate networks and merchants. 

In short, affiliate managers are faced with the dual challenge of managing territory-based affiliates in the borderless digital world. In order to handle this quandary effectively marketers must address two key areas, commission payments and communication, as both have a significant impact on global affiliate motivation. Additionally, this is also an opportunity for affiliate networks and merchants to achieve a competitive advantage by positioning themselves as truly ‘global’.

Commission payments

According to our research, conducted at the A4U Expo 2009 and ad:tech 2009, 32 percent of merchants were not happy with the costs associated with their payments processes. This is unsurprising, as organisations often spend thousands of pounds making global payments due to the high banking and administrative costs across different countries. As an estimated £227m was paid out last year in commission and fees to affiliates and networks (2009 Affiliate Marketing Buyer’s Guide), and the administrative and processing costs associated with payments can often be as high as £25 per transaction, it’s not hard to see how the costs can quickly stack up for merchants operating across borders.

To help motivate and connect with global affiliates, marketers must look to adopt a standard global payment process. This should be designed to increase the speed of global payments and to provide flexibility to affiliates. For example, allowing payments to be issued in a variety of currencies or formats (either loaded on to a virtual or plastic prepaid card or transferred to a bank account) will ensure that affiliates retain their enthusiasm and loyalty towards the brand.

Positive communication

Communicating effectively with affiliates that are based in remote parts of the world is also a challenge, however if managed correctly it will help to maintain a positive brand association, particularly when this experience is branded with the merchant’s logo. Advanced performance marketing software allows brands to provide an interface or dashboard for affiliates to monitor their activities and subsequent commission payments. This use of technology helps to improve affiliate loyalty and experience through clear and open communication. This can also be tailored to provide relevant information in the local language. In addition, email marketing alerts can be sent to affiliates informing them of a recent payment with links to check their account, thereby ensuring that the positive feeling of ‘being paid’ is directly associated to the merchant.

Now that affiliate marketing is firmly established, the industry will use the upcoming months to perfect and improve its processes and this will involve finding ways to build closer relationships with affiliates, regardless of size or location. Using appropriate technology will allow marketers to ensure that their processes for paying commissions and communicating with affiliates are successful, and this will ultimately be what drives true value for the industry.

Alex Mifsud
CEO, EntroPay
Twitter: entropay