Last week, we embarked on our annual expedition into the heart of London for Rakuten Advertising’s excellent Dealmaker event.
This edition of Dealmaker proved to be one of the best yet, with an expansive agenda of rich insights and fascinating conversations all round.
Pivoting away ever so slightly from singular, actionable strategies, this year’s show wielded a wider lens, examining the current state of the industry.
Nick Fletcher (SVP, EMEA) noted in his welcome speech that he had “never seen a year of so much change” in affiliate marketing.
Industry standards, best practices, relationships with regulators and Big Tech: all of these things are changing and have been in flux for some time. What feels distinct now is that we may finally be approaching the other side, the finalising of a whole new landscape.
Industry bodies like the APMA have been working hard to prepare the space and key partners for all of this. Shows like this, too, are very useful.
So, what are all of these changes?
We’re going through changes…
Fletcher highlighted six main changes impacting affiliate marketing today.
Some were slightly foreboding:
- Site reputation abuse - Google’s update that wiped out white label coupon providers.
- Browser extension controversy - Allegations of misconduct aimed at browser extensions and the subsequent fallout.
- Rising ad fraud - Advanced new methods of black hat affiliate practices.
Others were more inspiring:
- Regulations changing - the ICO marking cashback cookies as ‘strictly necessary’
- MMM development - the model has been found useful for affiliate measurement
- Tracking maturation - New and more sophisticated methods of attribution to ensure fair commissions.
If affiliate marketers can collectively navigate the challenges, then the industry could rise to a prosperous place, unlocking more growth, more opportunities, and reclaiming commissions which had previously been lost to the vortex of poor measurement.
New visions of data
Kevin Edwards, Founder of the APMA, was joined by Edward Trinkwon, Director of Analytics at Rakuten Advertising, and Sumair Seth, Vice President of Analytics at Ipsos, to discuss recent challenges with tracking, attribution, and incrementality.
Since the move to GA4, affiliate tracking has transformed into a Chinese puzzle box. Multi-layered, constantly shifting, and almost impossible to manage efficiently.
As marketers search for an alternative, Media Mix Modelling (MMM) has emerged as a popular choice – namely for its knack for establishing incrementality.
MMM can also be used to test hypotheses. You can run tests of campaigns in the model and predict how it might turn out, which is useful for large, make-or-break periods like Black Friday.
Addressing claims of affiliates overwriting other affiliates, which has drummed up this debate of split commissions, Edwards, commented, “Affiliates are seven times more likely to be overwritten by another channel than another affiliate. Rather than re-assigning value between affiliates, we should be looking at the bigger picture.”
The panellists also addressed how fixing affiliate’s measurement problem isn’t just to do with tech. It also comes down to how marketers view the space. Instead of focusing purely on ROAS and ROI, consider the lifetime value of customers too.
New forms of fraud
AdPolice’s Ryan Irvine, Marcode’s Andy Cooney, and Lo Digital’s Chikay Lo sat down to discuss the current landscape of ad fraud in affiliate and performance marketing.
One of the more striking points of the conversation was distinguishing between intentional and unintentional fraud.
They explained that some publishers might not know that PPC brand bidding is a bad thing to do. Furthermore, just because there is fraud rife on a subnetwork, that doesn’t mean the subnetwork itself is at fault.
They underscored that the main thing to look out for is ‘intent to deceive.’
When fraudsters are intentionally deceiving marketers, their strategies are more advanced. They use sophisticated cloaking techniques and many are now apparently intercepting via browser extensions.
There is a lot of fraud happening across subnetworks and influencer networks. As the panel mentioned, the subnetworks aren’t necessarily at fault here. But in order to improve the ecosystem, they ought to be providing as much data and granular transparency as they possibly can, so that advertisers can monitor what affiliates get up to.
If a subnetwork refuses to provide this kind of data, it may look like an admission of guilt.
The panel also noted to look out for high conversion rates from influencers. Influencers don’t typically convert at high rates, since they’re upper funnel. If it looks too good to be true, it probably is.
There is also an issue of complacency among brands. Many performance and affiliate teams on ther brand-side want to report good numbers and fraudsters are good at driving that.
The problem is, these numbers are ultimately false. They are not good for your programme and this will eat away at your revenue over time.
Affiliate and performance managers need to play the long game. Removing fraudulent affiliates from your programme might reduce numbers in the short-term, but overall it is healthier for your business.
Check out more on these themes
We had a fantastic time at this year’s Rakuten Advertising Dealmaker and we were proud to be media partners of the event. Keep an eye out for more in-depth interviews on the way.
If you’d like to learn more about some of these topics such as affiliate measurement and MMM, check out the agenda for PI LIVE USA, which is just a few weeks away.
