Episode Seventeen: Education, Understanding, and Reward

Unlocking the Full Potential of Affiliate Partnerships.

Overview

Lisa Chaikin, Vice President of Marketing for Awin and ShareASale, joins Gen3 Marketing as a special guest on Episode 17 of the Actionable Insights podcast series.

In this episode, Lisa uncovers insights derived from Awin’s latest research study titled “Unlocking the Full Potential of Affiliate Partnerships.” She provides valuable perspectives on the industry landscape and the hurdles confronting affiliate marketers. Lisa passionately underscores the necessity for a distinct identity for the channel and highlights its often-underestimated effectiveness.

Resources

• Awin Research Study – Unlocking the Full Potential of Affiliate Partnerships

Transcript

Kerry Curran

Hello and welcome to our latest episode of Gen3’s Actionable Insights, where we provide performance marketing and affiliate strategies for driving your business results.

Today’s podcast, Education, Understanding, and Reward, features the highlights from Awin’s original research paper. ‘Unlocking the Full Potential of Affiliate Partnerships’

So welcome, Lisa.

We’re so excited to have you here with us today. Would you please introduce yourself and explain why should anyone listen to you?

Lisa Chaikin

Thanks, Kerry.

Thanks so much for having me. I’m really excited to be here with you.

So hi, everyone. I’m Lisa Chaikin. I’m the VP of marketing for Awin and ShareASale.

So, I moved to London from Southwest Florida 17 years ago to get my MBA. I’ve worked in affiliate marketing for about 15 years now.

So, I started out on the SME side managing kind of smaller accounts. And then I moved into a PR and marketing role, which is what I’m passionate about and what I studied at school.

Kerry Curran

Excellent, great.

So, you bring tons of thought leadership and experience.

So, how do you explain to people outside of the industry what you do?

Lisa Chaikin

So, bit of a funny story.

I was asked to speak about this at my daughter’s school last week in recognition of International Women’s Day. And I was really trying to make this as relatable as possible so that small children would really understand what I was saying.

So, the best I could come up with was trying to think of it like a lemonade stand. So, imagine you have a lemonade stand and you know that you make the best lemonade in the neighborhood and you want everyone to know about it.

So, you tell your friends and family. But what if you could tell more people? So, affiliate marketing, it’s like having a really cool friend that helps you sell your lemonade. So, you… the company with the product, you team up with someone else, an affiliate or a partner, who tells everybody about your lemonade, the product. And they have to tell them about it in a way that really excites them.

So, if this friend helps someone to buy your lemonade because of their recommendation, then you give them a reward, like a commission. So, it’s like saying a big thank you to your friend for helping you to sell more lemonade. The affiliate is happy because they get rewarded and you’re happy because you sell more lemonade. So, everyone wins.

So, yeah, I told this story at my daughter’s primary school last week and everyone loved it. So, I thought it was a really easy and simple way to explain the industry. I also use this analogy to explain it to my mother and my stepfather, which worked well after 15 years of them not understanding what I do.

Kerry Curran

Yeah, no, that’s one of the best explanations we’ve heard. So, that makes so much sense. Well, thank you. So, as you mentioned, you’ve had a long career in affiliate marketing.

Talk about how you’ve seen the evolution of our channel of affiliate and what has really stood out to you over that time.

Lisa Chaikin

Gosh, I mean, so much has changed in the last 15 years.

I think it’s been really, really interesting to see how much evolution we’ve really seen through the channel through the course of my career. I would say the idea that the industry is, we’re constantly pushing boundaries, we’re really adaptable to change, we’re always trying to find new ways to deliver results, I think is a key thing.

I mean, one thing for me that’s really stood out is how we’ve shifted away from this kind of linear way of thinking of affiliate partnerships and how they can only support that traditional customer kind of ahead of a sale.

We are really now recognizing and wholly supporting that there’s an affiliate partner that can drive consumer action before a purchase, during the conversation and after a transaction occurs.

We’ve been talking about this at Awin for quite a while, thinking about like this cyclical journey that was really inspired by Scott Galloway’s clock model, which essentially says that the funnel or the linear customer journey where you started awareness and ended action and then the customer disappears, it’s really a broken model.

And I talked about this a little bit at Affiliate Summit West, which I know you were at as well. And it’s really just a powerful model if you think about this clock model, because it allows for a lot more diversity.

There’s way more than four hours on the clock, obviously. And it really truly reflects how customers shop, right? They don’t just start and end and disappear. The model really allows for advertisers to better understand how there’s an affiliate partner or a promotional type that can support each and every interaction of every customer journey. And it really gives a much clearer picture of where they should be putting their efforts. Where should they be investing their time? What are the types of partners they should be investing in?

And we talked a lot about this idea of really diversifying the portfolio of the different types of partners. This is something I think is really exciting for the growing influx of plug and play technology partners.

These types of e-commerce solutions that can improve the user experience on a brand site. They can be deployed in just a few clicks and rewarded on a performance-based model. So, whether it’s looking to increase an average order value, resolve customer queries or pain points, personalization of offers, there really are just endless opportunities with a really diverse range of partnerships.

And we’re really trying to encourage people to think about this in that cyclical way and partner with as many diverse partners as they possibly can.

Kerry Curran

Yeah, definitely.

No, that’s I love the clock model and it’s so true because it costs more to acquire a customer, yet so many brands are versus retaining one and so many brands are so heavily focused on net new that you’re right.

Like there’s so much more opportunity to use the publisher mix to connect and continue to build relationships and drive that revenue.

Lisa Chaikin

Exactly.

And I think also it’s a really simple model to follow, right? It goes back to my lemonade stand. Like if you’re trying to make this relatable and understandable for people that don’t work in affiliate, they get it.

They’re like, oh, that makes so much more sense. So, I think it’s just a really lovely, a lovely story to be able to tell.

Kerry Curran

Yeah, definitely.

So, I know you, Awin and ShareASale, you worked closely with Forrester to dive in more to kind of research of the industry, the landscape. So, tell us a bit of what was your thesis going, or give us a little bit of background in what your thesis was going into setting up this research.

Lisa Chaikin

So, I think we kind of came to an idea of doing this.

We’ve been talking about it for a couple of years. But really, at the end of last year, we decided we wanted to go out to market and really get a better understanding of digital marketing investment, right?

So, it’s no secret that big tech sort of dominates over other channels when it comes to digital ad spend. And in the US alone, nearly two thirds of digital ad spend is currently going to Google, Meta, and Amazon, which leaves such a small piece of the pie for everybody else.

And again, I talked about this a little bit at Affiliate Summit West where, as competitors and everybody, all of the networks and all of the SaaS platforms, we’re competing for that last dollar when really we should be competing with the big tech players and we should be collaborating more to try and take that bigger piece of the pie.

So, outside of the obvious challenges that this presents, the auction-based ad models for that the big tech companies have really favor their own bottom line and it really inflates the cost for brands.

Obviously, I know this, you know this, Kerry, but as an industry, are we entirely sure that the CMOs and the decision makers and the people that are holding the purse strings, do they know this, right

Are they aware of the limitations with advertising on Google and Meta and Amazon? Do they really understand the value of affiliate and how it’s not just coupon and cashback anymore?

And if they recognize that value, are they planning to actually do anything about it? So, that was really our thesis going into this. We wanted to get… answers to these questions and it’s why we decided to partner up with Forrester so that we could really just get a better understanding of the true perceptions of business leaders across the affiliate channel and try and help them map that to their own sort of blueprint for success.

Kerry Curran

Yeah, definitely.

We’ve seen so many of the same challenges across our client base. And you’re right, in the industry as a whole. So, I love research papers and getting into the data.

So, tell us what stood out the most or surprised you the most.

Lisa Chaikin

So, the top line kind of results from the survey answered some of those questions that I just mentioned but what it told us really was that 92% of the respondents that were surveyed viewed affiliate as an effective or a highly effective channel, yet only 7% said that they were planning to increase their investment in affiliate this year, which I would say isn’t actually that surprising but it really does make you think a lot more deeply about the reason for this.

We wanted to take this kind of one step further to try and understand why. And we asked a lot of, a lot of questions within the survey.

We asked the respondents what it was that they felt the unique strengths of affiliate marketing were, again when comparing that to other channels.

And the results of this were particularly interesting because the responses were so evenly spread out that there was only a 4% difference across 10 different kind of answers or questions.

So, everything from the more commercial aspects like delivering our high ROI, that it’s really an incremental or a clearly incremental channel for them, that it’s a really reliable source of revenue to the kind of more strategic things like affiliate being a lot more flexible than other channels, much easier to control for specific marketing outcomes.

So, kind of that range of attributes is really a strength and a potential weakness for us in the channel, in my opinion. And I think the variety of positive characteristics for this, it’s attractive for any level of marketer.

But I think the one takeaway from the insight is that we really lack a clear identity. We’re a channel that’s just highly mutable, right? We’re not just one that’s unfamiliar with it. We’re able to kind of point to and quickly understand.

So, I think this is something that can hinder our ability to engage senior marketers and executives. because we need to really be better about telling this story and be able to unlock further buy-in, further investment for the channel.

Kerry Curran

I wholeheartedly agree.

We keep saying that the affiliate experts need a seat at the table, the planning table when budgets and media plans are being set up and allocated towards that shared business goal.

And so, you’re saying the channel effectiveness, it’s infuriating to see such a high level of reported effectiveness and that gap on… who is planning on increasing investment. And we’ve seen the same thing where it’s the dependency on those other channels.

So, tell me more about your perspective on the effectiveness and really why do you think it’s so undervalued at the bottom?

Lisa Chaikin

So again, I think it kind of comes down to this idea of not really having a clear identity. And I think collectively as an industry, not telling our story well enough.

Again, another one I touched on a little bit at Affiliate Summit West is, as active players in affiliate marketing ourselves, we really love the channel. We understand how powerful and how diverse it is. But for people that are less familiar or less involved in the day to day.

it can be quite hard to wrap your head around what affiliate marketing’s true capabilities are and the true value of it. And this is where, we need to kind of hold our hands up and say that we’re going to be more responsible as advocates and ambassadors for the channel to share this story, to talk about the value, to make it more widely understood, to really again, going back to the clock model and making sure that that’s not an Awin story, right?

This is the channel story. We like to use the clock model. But, it’s Scott Galloway’s model. At the end of the day, if everybody talked about the channel in the same way, and we all were really trying to push to get the story out beyond just our own echo chamber, I think that is really going to be quite powerful.

Kerry Curran

Agreed.

And as we said, like, we’re definitely seeing the same thing. It’s the education, the understanding, the impact, and really just the overall value. And the other aspect is, as you mentioned, it’s that… planned outcome that pay for performance.

It should be a no brainer for the marketing leaders and there’s a long, there’s a lot of education we need to continue to push upwards into those marketing executives.

Kerry Curran

But this has been really great, Lisa. I love, like I said, I love your research. I love the data. And again, it should be a no-brainer for brands to really lean in more and consider the affiliate channel.

We ask all of our guests to leave the listeners with an actionable insight that they can apply right away.

So, what would be your recommended action for anyone listening today?

Lisa Chaikin

So, a bit of a shameless plug, but I would say the best thing that I can advise for everyone to do is to go to awin.com and download our Forrester report.

I really believe it’s the smartest thing everyone listening can do to better understand the current perception of the C-suite regarding affiliate marketing, how they’re realizing value for their investments in the channel, and what the brilliant opportunities are for affiliate marketers for growth.

Kerry Curran

We’ll be sure to include a link on our website to drive people to that as well. But as you said, you can go to awin.com/forresterstudy or find it on the Awin website.

So, thank you so much, Lisa. I’ve really enjoyed our conversation and really thank you to Awin for commissioning such important data that… we really need to, as you said, spread throughout the marketing leadership.

So, thank you for your contributions to the industry as a whole.

Lisa Chaikin

Thanks so much for having me, Kerry.

I really enjoyed talking to you about this.