How to Measure Affiliate Marketing
We cover how MMM, coupons, bottom funnel and top of funnel metrics can help you understand the performance of your affiliate campaigns.
Poor measurement of Affiliate marketing can lead to costly mistakes: undervaluing partners who drive new customers, overpaying for bottom-funnel conversions that would have happened anyway, and vulnerability to fraud.
This guide shows marketers how to accurately measure affiliate performance across content partnerships, coupon sites, and loyalty programs by combining Marketing Mix Modeling (MMM), engagement metrics, and multi-touch attribution.
Written with the help of affiliate experts Mike Currey and Lacie Thompson
The origin story of this post was an earlier project of mine for a leading B2C brand. Much like everyone else, they migrated from Universal Analytics to Google Analytics 4 and suddenly reported a very different number of conversions for their Affiliate campaigns. Only 40% of conversions reported on UA were attributed to Affiliate on GA4.
I shared this story on Linkedin. There, I chatted about how Affiliate campaigns should be measured with Mike and Lacie. With many decades of Affiliate experience between them, they helped me uncover common gaps marketers make when measuring the strategy:
Mike Currey: 20+ years in digital marketing, 10+ in Affiliate alone. He ran T-Mobile, Blue Nile, and Quince’s Affiliate programs.
Lacie Thompson: Founder of LT Partners, an Affiliate marketing agency acquired by New Engen.
The peculiarities of Affiliate campaigns and how it differs from paid media
What we’re covering as “Affiliate” in the article
In this article, we’re referring to “Affiliate” campaigns in which publishers or individuals (“partners”) are compensated based on measurable results. These campaigns usually have a dedicated tracking link per partner, enabling conversions to be attributed to each individual.
Affiliate is a wide-reaching and varied initiative. Some examples are:
Blogs or influencers (known as “Content”)
Coupon and deal sites
Toolbar add-ons, like Honey
Employee benefits partnerships
Card-linked offers (CLO) from banks and credit cards
Customer loyalty benefits
Affiliate “Ad platforms” are usually campaign managers’ source of truth
Paid media campaigns are usually set up via ad platforms. You create campaigns and bid for clicks on Google Ads. Affiliate campaigns, similarly, are created and maintained on Affiliate platforms.
These platforms are shared by advertisers and publishers alike. Both parties use them to visualize campaign results. Since this data usually defines “payouts” (how much compensation each partner should receive), they’re commonly used as Affiliate campaigns’ “source of truth.”
There are many affiliate platforms, some of the most established being Impact, Rakuten and ShareASale.
Differences between Affiliate reporting and traditional paid media reporting
For paid media reporting, measuring conversions and other metrics that indicate quality traffic (e.g., time on site) in the ad platform helps campaigns self-optimize. These data signals help Google, Meta, et al. understand which users you want more of.
The compensation for each partner is defined by which KPIs were chosen and how they’re attributed.
In Affiliate campaigns, advertisers measure metrics in the affiliate platform to calculate how much each partner should receive. The compensation for each partner is therefore defined by how metrics are chosen and how they’re attributed. Ensuring partners are compensated fairly enables them to continue to provide value.
Best practices for measuring affiliate performance
Only reporting on 1) last-click attribution and 2) purchases for Affiliate campaigns is a mistake. While conversions are certainly important, this narrow view can overlook significant contributions made earlier in the customer journey and, most importantly, can overestimate the impact of certain sources. This can lead to undercompensating valuable partners and misinvesting marketing budgets.
Define UTMs to report on results per partner
Affiliate campaigns need reporting like every other campaign type to understand traffic quality and direct-attributed conversions. Therefore, Affiliate links should include UTMs to enable reporting on Google Analytics, Snowplow, Mixpanel and similar tools.
Usually, Affiliate naming conventions include Partner IDs and Content Type. This granularity is necessary to define unique KPIs for each Content Type. In most cases, advertisers cannot measure Affiliate campaign results per creative.
Tackling last click attribution’s limitations with MTA (Multi-Touch Attribution)
Some Affiliates, such as browser add-ons like Honey, only show up at the tail end of a transaction. But are these conversions incremental? Last-click attribution would credit Honey for the conversion, but this ignores the initial touchpoints, like Content affiliates (e.g., blogs or influencers), that introduced the user to the brand.
A multi-touch attribution (MTA) model that accounts for various interactions across the journey can help here. You can assign different weights to each Affiliate’s contribution, ensuring that credit is distributed more equitably. For example, you might reduce the weight of tools like Honey that appear primarily during the purchase phase and increase the credit for affiliates involved in prospecting (e.g., content creators).
Leveraging engagement metrics for partners that are driving awareness
Not all Affiliate strategies should be measured or compensated solely on conversions. In some cases, traffic quality or new user acquisition might be more relevant indicators of performance, especially for top-of-funnel Affiliates like blogs or influencers.
Compensation for prospecting: Content Affiliates can be evaluated on the percentage of new visitors they generate. A better model for these partners might involve compensating them per new user website visit, rather than just for last-click conversions. It’s important to remember that if you don’t compensate partners fairly, you risk losing them from your plan.
Diversifying KPIs: For deal or coupon sites, metrics like conversion rate are critical, but for content partners, it’s important to track engagement metrics like time on site, number of pages visited, key pages visited (e.g. pricing) or bounce rate to assess the quality of traffic they bring.
MMM is valuable, but must be structured differently
Marketing Mix Modeling (MMM) is a useful tool for understanding the performance of top-of-funnel activities. It helps brands measure strategies that don’t generate clicks (e.g. OOH, video) and with long-term impact (when conversions occur outside of the lookback window). But, unlike paid media, where daily impressions and spending are input in the model, Affiliates only have “spend” when conversions occur. This shifts how MMM should be structured for affiliate campaigns:
Adapting MMM Inputs: Traditional inputs like daily impressions aren’t available, and spend is contingent on performance. Instead, Affiliate MMM data input will rely primarily on click date.
Lacie worked on a recent project where a client’s MMM analysis reported a $28 ROAS for Affiliate. However, on GA4’s last-click model, the strategy only received a $6 ROAS. The client doubled down on Affiliate and saw an increase in sales corresponding to a $20 ROAS. This is a good example of how MMM can help identify opportunities in marketing campaigns that under-report on click-based attribution, like Affiliate.
Post-consumer surveys don’t work as well
Zero-party data like “How Did You Hear About Us” (HDYHAU) is a form of attribution that can be very helpful in understanding strategies that don’t measure well with click-based tracking. On paper, that’d include Affiliates, but that’s not the case. Affiliates are so embedded in the customer's life (employee benefits, loyalty programs, discounts), users don’t even realize they’re being served that content.
Beware: the nature of compensation leads to a fraud risk in Affiliates
Due to the compensation structure in Affiliate marketing, there’s a higher risk of fraudulent activities such as click farming or bot traffic inflating results. Here are steps to mitigate these risks:
Click Quality Monitoring: If Affiliates are being rewarded for clicks, it’s essential to audit click quality. Affiliate tools (like Impact or CJ Affiliate) provide visibility into suspicious activity, allowing you to detect unusual spikes in clicks that don’t correlate with quality traffic or conversions.
Voucher and Coupon Site Leaks: Coupon leaks, where discount codes are shared on unauthorized platforms, can lead to unintentional attribution and revenue loss. Ensuring that each voucher is assigned a specific partner helps mitigate this faster. Mike suggests including the partner's name in the voucher to disincentivize others to share it.
Compliance Tools: Tools like BrandVerity and SearchMonitor also provide a more comprehensive array of “protection” features to avoid spending on “stolen” clicks.
Expiration dates: Expiring vouchers after a set number of days can also mitigate risks of code sharing. For example, vouchers that are no longer valid for 7 days after their creation.
Most measurement best practices fit Affiliates, but customization is needed
Just like any other marketing strategy, it’s crucial to ensure that the way you measure Affiliate campaigns aligns with the specific goals of each campaign. Misaligning KPIs or relying too heavily on last-click attribution could lead to misinvesting budget or even cutting funds for strategies that are essential for driving new users to your brand. For example, content affiliates—who are often responsible for bringing in new prospects—might not get the credit they deserve if you’re only looking at conversion metrics.
If you want to audit or improve your marketing measurement, please reach out to me! If you’re looking for expert Affiliate help, Lacie’s agency is a great place to start your search.
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