3 benchmarks that indicate your affiliate program is doing well
We’ve covered everything from finding the right affiliates to launching your affiliate marketing program – but when it comes to assessing how well your program is doing, what specific indicators should you be looking for?
If plenty of affiliates are signing up to work with you, everything’s good, right? Well, it’s slightly more complex than that. The quality of your affiliates and how well they match with your market niche are additional factors that play into the equation, for example.
Even overall increased sales don’t necessarily amount to an accurate picture of the return on your affiliate program investment.
In a previous post – How to track and measure your affiliate program – we discussed some of the key performance indicators (KPIs) that you should be aware of if you want to assess your affiliate program’s success.
In this post, we look at 3 benchmarks that indicate your affiliate program is doing particularly well!
You have an affiliate conversion rate of 10% or higher
In general, increases in sales and revenue are great news! But, they don’t necessarily tell you much about the performance of your affiliates, or how well your program is functioning.
Affiliate conversions, however, are a bit more relevant. So, how do you calculate your affiliate conversion rate?
( Sales / site visitors ) x 100 = Affiliate conversion rate (%)
With this calculation, site visitors refers to all traffic driven to your site by affiliates, and sales refers to completed orders made by those site visitors. Divide the sales by the site visitors and then multiply by 100 to get a percentage.
So, for example, if you analyze your site traffic and find out that affiliates are responsible for 1,500 site visits per month, and you made 30 sales from that traffic, you would get an affiliate conversion rate of 2% ( 30 / 1500 = 0.2 x 100 = 2% ).
If you want to figure out what’s working and what’s not on a more granular level, you can dig into which segments of your affiliate team are producing the best conversion rates — and what they’re doing right.
What marketing tactics do they employ? What kind of creatives do they use the most? What else do they have in common with other high-performing affiliates or affiliate segments?
Individual conversion rates can also highlight issues with affiliate preparedness, competence, and suitability for your program.
You can use Google Analytics to track sales conversions across different affiliate landing pages, for example. Here are our general conversion rates by landing page at AffiliateWP:
However, when looking at your program’s overall affiliate conversion rate, calculate the average of those landing pages when making your assessment.
While some sources point to standard affiliate conversion rates as low as 1-3% and others say anywhere from 5-15%, an affiliate conversion rate of 10% or more would indicate that your affiliate program is doing particularly well.
Of course, the higher the better!
Your have an active affiliate rate of 10% or higher
As we’ve mentioned before, your program is only as good as your people. Just because affiliates are signing up, does not mean that they are necessarily contributing in a meaningful way.
Sometimes, people simply get busy and forget about you. Sometimes, they become disinterested for other reasons – your brand doesn’t appeal to their audience as much as they initially thought it would, they aren’t excited about the promotions you’re offering (maybe the promotions aren’t competitive enough), or your affiliate incentives (such as increased commission rates for top performers) feel a bit too out of reach for them – or are dominated by a select few affiliates.
In particular, dormant affiliates can actually be a drain on your resources, especially if you put a lot of effort into things like affiliate onboarding, . This is why it’s so important to properly vet affiliates to make sure they are a good fit for your program before bringing them onboard.
What makes for an “active affiliate”?
Active affiliates are essentially affiliates who are actively promoting your products in some way – publishing graphics, links, product photos, videos, and other creatives, for example. For this number to be a particularly meaningful measure of your program’s effectiveness, these creatives should be getting clicks and generating traffic to your site.
In other words, it’s not really worth considering affiliates who are promoting unsuccessfully in this particular equation. However, those affiliates should still be addressed to be sure they are correctly representing your brand and using the best practices.
In reality, the vast majority of affiliates in most programs are often inactive, with only a handful of affiliates bringing in the most revenue, so an active affiliate rate of 10% or higher means that you’re doing something right!
If you have an active affiliate rate below 5%, here are some questions to think about:
- Do your affiliates need help with marketing your business?
- Should you be recruiting more high-profile affiliates?
- Are you offering the right commission rates?
- Have you overlooked your customers as potential affiliates?
- Could your affiliate creatives be more appealing?
- Is there more you can do to personalize the affiliate experience?
If you want to move things along, consider implementing a new time-sensitive activation bonus. Or, for more ideas on how to mobilize your affiliates with giveaways, check out this post.
Your best affiliates stick around for a year or more
With all of the affiliate program choices available to affiliates these days, it’s no wonder that affiliates can be flighty. It can be difficult for them to commit to promoting a business or product when they have so many options.
Affiliates can also be motivated at the start, only to lose steam over time due to better competitor offers, affiliate fatigue, or even quitting affiliate marketing altogether. So, it really means something when they stick around!
For one thing, loyal affiliates tend to be more familiar with your brand and products, and better equipped to effectively promote them. They are also some of the best sources of useful feedback that can help you improve your program, your affiliate promotions, and even your products.
Plus, in addition to giving you a general sense of how your program is doing, loyal affiliates essentially communicate to you that:
- Your commission rates are satisfactory and niche-appropriate
- Your brand is palatable and relevant to them
- Your company reputation is good
- Your affiliate program reputation is good
Obviously, affiliate loyalty is a bit more important when it comes to active affiliates – more specifically, high-performing affiliates. But, the bottom line is that if the affiliates who are bringing in the majority of your program’s revenue are also staying with you for a year or more, you’re doing a good job!
A bird’s eye view
These three benchmarks can certainly give you an overall idea that your affiliate program is thriving, but if you want more actionable information that can help you make decisions around everything from marketing to affiliate management, be sure to look at the KPIs we mentioned in our post about affiliate program metrics!
What other indicators have highlighted the success of your own affiliate program? Is there something we missed in this post? Be sure to let us know in the comments!