Partnerships within the affiliate model used to be regarded as the only truly authentic pay-for-performance marketing co-operation. Affiliates are paid only after they have also delivered an agreed result. In the past, these relationships were facilitated by affiliate networks. Today, thanks to technological advances and market developments, brands are going one step further.
Brands today can structure a variety of partnerships based on a pay-for-performance model. This includes partnerships that go far beyond traditional affiliate partnerships – and of course, this also places new demands on technology.
Affiliate Marketing as part of Partner Marketing?
In the future, it will no longer be “Affiliate Marketing or Partner Marketing”, “Influencer Marketing or Partner Marketing”, or even “Partnerships or Partner Marketing”.
Each of these channels – and many more where performance is the main focus – is already known as partner marketing.
Partner Marketing vs Partnerships
The difference between performance-oriented partner marketing and the partnerships that many may understand as collaborations from large companies lie primarily in the payment of partners. Unlike conventional co-operations, payment in partner marketing is based on actual, measurable results.
The brands use a global technology platform to which all existing partnerships are connected. This creates a more efficient, scalable partner marketing program.
What is driving this change in partner marketing?
Brands – more transparency, more control
As consumer demands on brands evolve, so do the needs and expectations of brands on their partners.
Brands want …
… more transparency:
More visibility by allowing the activities of all partners to be followed step by step.
… to maintain control:
More control over their brand and how and where it is displayed.
… lower risk (in their marketing activities):
The ability to work with other brands/companies/individuals on a performance basis and pay only when a service or revenue is realised.
Partners – a fair remuneration structure
Just as the needs and desires of brands change and evolve, so do the needs and desires of the individuals and companies that work with them.
… more transparency:
Greater clarity in terms of brand data, KPIs and goals, so that they can better optimize their marketing strategies and thus achieve goals.
… clear communication and up-to-date resources:
To achieve the best possible results, partners expect a clear exchange of information and resources.
… to have compensation options and flexibility:
In addition to fair compensation, many partners who were familiar with receiving a fixed upfront fee want the flexibility of a “Performance Plus” compensation structure.
With “Performance Plus” compensation, partners typically receive a lower flat fee upfront and then a commission for the back end after the results have been driven forward. It is a middle ground between a remuneration based on 100% performance and remuneration paid in full in advance.
Technology Development in Partner Marketing
Like everywhere else, technological progress is rapidly changing the way companies structure, consolidate, automate and scale their business – including their partnerships.
Using a single technology platform
The technological demand is clearly moving towards an all-in-one platform (e.g. tracking platform and program management).
Instead of running different marketing channels over different networks and platforms, brands expect a single technology platform that covers all marketing channels and helps them scale.
The future of partner marketing
As partner marketing continues to evolve, brands are expected to place more and more emphasis on which partner represents what value to their business and how they can use the data gathered to achieve profitable growth through partner marketing.
In the world of marketing and business collaboration, many exciting things are happening that pave the way for a high-quality, performance-driven partner marketing channel.
We are just at the beginning of this journey. But little by little, case studies and examples will come to the fore, showing others the enormous growth potential – far beyond traditional affiliate partnerships.