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Evolving performance-based partnerships: What you need from your provider | Sponsored Content

This sponsored article was contributed by Partnerize.

As a predecessor to the partnership channel, affiliate marketing's mechanics are quite simple. Under the affiliate model, a publisher receives commission in exchange for referring conversions or sales to a brand's website. The relationship is tracked and measured with compensation deployed via the affiliate network—which, in the nature of full transparency, did very little other than that. Because of the pay-for-performance model, most publishers—at least those that delivered scale—firmly resided in the last-click position of the consumer journey, meaning they were heavily skewed towards the coupon and cash-back category.

From affiliate to partnerships

Over time, advances in compensation structures, reward logic, and attribution have thankfully given way to a more diversified ecosystem of partners. Affiliate still plays a role and is often the most recognized contributing type. However, partners who may have lived in the discovery or influencing stages of the buyer journey now meaningfully contribute in both traffic and revenue. These compensation advancements have created a robust partnership ecosystem that today spans affiliate, influencer, content, advocate, and referral, to name a few.

What brands need to know about managing partnerships (spoiler: affiliate tools alone won't cut it)

As mentioned, partnerships can take on a myriad of forms from affiliates to influencers to advocates to employees, and even wholesale relationships. But an important commonality to consider across these partner types is the channel incentives that are used to modify or influence the behavior of partners. The deployment and management of channel incentives are automated and scaled across a broad set of partners, making affiliate providers ineffective at addressing the needs of partnership programs. As partnerships continue to expand and diversify, the management, design, tracking allocation, and distribution of partnership incentives need to cater to those types of relationships. Brands need to rethink old tactics in favor of new ones, incentivizing desired behaviors to improve the yield from the partner ecosystem.

As an example, why just reward short-term metrics like ROI when you can instead reward long-term performance such as lifetime value (LTV)? But before we get ahead of ourselves, you first need to tap a provider that can enable you to reward in this manner. Tapping this provider can equip you with long-term rewarding capabilities, enabling you to realize greater profits in the long run.

It's also prudent to keep in mind that incentives can take on a variety of forms, including commissions, sales performance incentive funds (SPIFs), non-monetary rewards, and more. As influencer relationships continue to infiltrate and cross the partnership chasm, the incentives might be different and therefore warrant a correlative approach in terms of incentive deployment, attribution, and reward type.

With an ever-changing buyer journey and a rapidly evolving partnership ecosystem, brands need providers that offer advanced incentive structures, attribution, and measurement solutions. Partnerize is leading the charge on partnership automation and was the only provider disrupting the affiliate category to be named a "strong performer" in The Forrester Wave™ Channel Incentive Management, Q1 2022. Learn more by accessing the complimentary report here.

—Maura Smith, CMO, Partnerize