Nov
25
Measuring effectiveness of channel partners
November 25, 2008 |
Affiliate marketing and promotion is now one of the most effective ways of selling and marketing products on the internet. It works through a network of partnering websites that embed a link or a banner to the merchant websites in their own websites to convey part of the traffic that enters the affiliate websites who are interested in the product, directly to the merchant website to perform the action of purchasing. This is the affiliate program in simple words but how can the two parties make sure that they are on the right track and their marketing plan is flawless. To respond to such need of monitoring and evaluating channel partners effectiveness companies started to develop more and more programs and systems whish are able to gauge the efforts of both parties and calculate the commissions of the affiliate websites.
One of the most important solutions which were developed for this problem was the affiliate network; this party which entered and gained a key role in the operation to act as a monitoring tool to measure how effective is the affiliate website and the amount should be paid to this particular website in the favor of its efforts.
Also with the development of the affiliate programs the affiliate networks acted also as a market place for the merchant to propose their products and programs and for the websites looking for an affiliate program that suite their needs.
The presence of the affiliate networks established a new level of trust and prevented the affiliate websites from feeling that they are not getting the right commission and compensation for their efforts and it also encouraged these sites to put more efforts in making their sites more interesting for customers and maintaining an up to date information that will keep the rate of the daily traffic at its maximum as this is the only way to keep the link hitting rate and generating sales.
From the merchant side, the affiliate networks provided them with the required statistics to know if their marketing plans are on the right track or not and what they need to know to increase sales. For example, if you found that most of the sales coming from affiliate websites which their main theme is music then you should think on how you can address more music lovers on your next campaign.
Also you will be able to calculate your revenue consumed in affiliate marketing and decide whether the profits worth the payment or not, or should you increase or decrease the commission or even if you have to change between the different compensation methods like per click or per sale. No doubt, the affiliate network helped in the development of the affiliate marketing plans and agreements and the profits gained by both the merchant and the affiliate websites and without the presence of a measuring tool to evaluate such a process it would have been so difficult for such a process to continue.
Do not forget the purpose of affiliate marketing is to create newer affiliates. We should set the performance indicator in light of this purpose rather than sales.
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