Big data is inseparable from successful affiliate management. Over the last month we’ve looked at how you can use information to improve affiliates’ performances, to maximise their profitability and also to reactivate and reengage them. This week we conclude our series by discussing how operators can use big data to ensure that affiliates’ profitably is maximised.
Profitable affiliates are, of course, the backbone of any affiliate marketing campaign. They’re the engine that drives growth and developing and maintaining a positive relationship with these affiliates is the key to sustained success.
There are a number of different types of profitable affiliates and each type requires a different strategy. Here’s how an affiliate-specific strategy can be developed using the Income Access Affiliate Software:
- Start by pulling a list of all active affiliates in the programme using the Member Report tool
- Export a member list (e.g. Excel, CSV, XML or HTML) for the time period you are looking to compare profitability. Six months is a good guideline as it allows you to view long-term trends.
- Add an additional column at the end to measure profitability using the formula (= Net Revenue – Commissions)
- Sort in descending order to view the profitable affiliates at the top
- Once you have determined which affiliates are profitable, run an Account Report to determine exactly why the affiliate is profitable
- Group profitable affiliates into high value and low value affiliates
- Divide the profits of each affiliate by the number of players they have to get profit per player
Using these seven steps you’ll be able to classify your affiliates according to profit. Affiliates that generate the highest profit and highest profit per player are considered ‘super affiliates’. The success of your marketing campaigns depends upon your ability to retain super affiliates and prevent them from leaving your affiliate programme to join those of your competitors.
Profitability isn’t always clear-cut. Some affiliates have high profit-per-player but show low overall profit. These affiliates need to be evaluated. If they have a low volume of traffic but it’s good-quality traffic, encourage them to reach out more. For those that have a high volume of traffic, renegotiate with them and propose a more lucrative commission model.
The most important thing to stay focused on when engaging with profitable affiliates is effective affiliate relationship management (or ARM). When your – excuse the pun! – ARM is fully extended, you understand the needs of affiliates intimately and are able to develop a symbiotic and mutually-prosperous relationship with them. Excellent ways to add extra incentives include giving them extra time to react to upcoming changes and offering VIP monetary or content treatment.
Tell us about your own approach to ARM in the comments sections below. While you’re at it, you can also give your feedback on our advice and the whole big-data blog series. Alternatively, don’t hesitate to reach out to me with your insights and comments.