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Marcus Johnson: Hey gang, it's Friday, August 21st. Max, Adam, Ingrid and listeners, welcome to Behind the Numbers, an eMarketer podcast made possible by AWIN. I'm Marcus, and joining me for today's conversation we have three Knicks fans, I'm so sorry. Our pr- principal analyst living life in Philly, Max Willens.

Max Willens: Yo.

Marcus Johnson: Hello there.

Marcus Johnson: We're also joined, uh, by president of North America for AWIN, living in New York, Adam Weiss.

Adam Weiss: Hello.

Marcus Johnson: Hello, fella. And over in Seattle, chief marketing and commercialization officer at HigherDose, Ingrid Millman Cordy.

Ingrid Milman Cordy: Hey, everyone.

Marcus Johnson: Hello there. Uh, so they're our three guests. Let's get to know them, uh, a little bit better in 60 seconds or less.

Marcus Johnson: We've got our speed intro for you. So-

Marcus Johnson: First question. Uh, the first two, no, the first one is for, uh, just Adam and Ingrid i- in that order. Uh, Adam, what do you, what does your company do, in a sentence, and what do you do for them in another sentence?

Adam Weiss: Sure. Uh, Awin is a global affiliate marketing platform and network, and what I do for them is I run the entire North American business.

Marcus Johnson: Oh, that's all. Okay. Uh, what about you, Ingrid? What, uh, what's your company do and what do you do for 'em?

Ingrid Milman Cordy: Sure. Uh, HigherDose is a company that brings the most innovative results-driven, um, wellness and beauty devices into your home. We help people with everything from better sleep and recovery to glowing skin and fuller-looking hair.

Marcus Johnson: Very nice. Um, did you say what you do for them?

Ingrid Milman Cordy: I lead all go-to-market strategy, so that's everything from D2C marketing, and, uh, commercialization.

Marcus Johnson: Very good. Uh, Max, we know you. Um, let's move to our second question. Uh, Adam, I'll go back to you for this. Most interesting thing that you've read, watched, or listened to recently?

Adam Weiss: Well, the most interesting thing I watched was the Knicks winning-

Marcus Johnson: Oh, here we go ...

Adam Weiss: the championship. Um, but-

Marcus Johnson: That's

Adam Weiss: fair ... I will say the most interesting I, I read, actually, this weekend I read a great article in The New York Times about Route 66, the mother road- Mm ... across the US. Yes And-

Marcus Johnson: Happy birthday ... that- Happy 100th birthday.

Adam Weiss: That's right. That's right. And the culture and community it's created. That was really cool.

Marcus Johnson: Cool. Fascinating. It's so int- is it ... It's part of it is still Route 66, correct? And parts of it have been decommissioned?

Adam Weiss: That's

Marcus Johnson: exactly right.

Adam Weiss: Right. Okay. Now

Marcus Johnson: there's,

Adam Weiss: like, a whole movement to sort of bring it back.

Marcus Johnson: I lo- as a fan of road trips, I, uh, tell me where to sign. I'll look for it. Uh, very nice. Ingrid, how about you?

Ingrid Milman Cordy: Uh, I love, love, love a good podcast. So Diary of a CEO had Jeremy Grantham on a few weeks ago. Right. And it was so great. I love a grumpy, old English man that has some good- Has some good thoughts for our, our new world.

Marcus Johnson: Very nice. I'm h- I'm half of that statement, grumpy, old English man, but I don't have many thoughts. Uh, Max, how about you?

Max Willens: Um, I'd like to say it was something about, you know, why the, uh, oil market, uh, hasn't responded to the Iran war the way that it has. But really the answer is, uh- Here we go ... Mar- Mary Beth Barone's Netflix special.

Max Willens: Um- Oh

Ingrid Milman Cordy: my God, so good. Oh.

Max Willens: I thought it was really, really funny. Mm-hmm. Uh, even though it's definitely not for a person like me, I thought it was very funny and very smart. So, um, I'm planning a sort of, uh, Barone-ing deep dive so I can maybe become a Barone if they'll have me.

Marcus Johnson: Ah, very nice, folks. Um, well, there are our three guests for today's episode.

Marcus Johnson: And what we're gonna be talking about is affiliate as a strategy.

Marcus Johnson: All right, gang. So, uh, technically there's an official definition for everything. If you ask 100 people, um, what the definition of something is, none of them will give you what the dictionary says. You end up with 101 different answers. Uh, Adam, I'll start with you. How, how would you define affiliate marketing today?

Adam Weiss: Um, it's a good question, and I think you're right. A lot of people would probably define it very differently. But I, I see it as a aggregation of partners that can help drive sales for brands and advertisers that perhaps they couldn't find on their own. So you have a whole portfolio of publisher partners finding customers, driving them to that brand, like HigherDOSE.

Marcus Johnson: Mm-hmm, mm-hmm.

Adam Weiss: I could probably keep going down the rabbit hole here, but I'll pause.

Marcus Johnson: Uh, Ingrid, Max, anything to add? Do- do your defin- definitions differ?

Ingrid Milman Cordy: Uh, no. I'm very aligned with Adam's. Also, he's the king of affiliate in our world- ... so that, that, it's a good thing that we're aligned. Uh, no, I think just from a brand standpoint, it's people and publishers who can help introduce your brand to the right audience at the right time.

Max Willens: Yeah. I like both of those. Um, I'll add a slightly, uh, pithier answer, which is that it's one of the engines of, uh, the next era of, uh, social commerce really. I think about this a lot in, you know, the kind of coverage areas that I have. But it's, it's really amazing how much, uh, kind of jet fuel, uh, affiliate has poured into the next era of, kind of, e-commerce overall.

Max Willens: And, um, so yeah, that's, that's my answer, I guess. Mm-hmm.

Adam Weiss: I think 'cause it also is a, it's a frictionless way, right, to partner with large brands and retailers, and to also structure the economics around those partnerships as well, versus having to do it one-off, right, with thousands of brands or thousands of publishers.

Adam Weiss: It makes it a lot easier. Mm-hmm. So it scales from that perspective.

Marcus Johnson: Yeah. Um, Adam, what, what part of affiliate is, do you find most interesting right now, and, and why? Lots to choose from, but what, what's caught your eye the most?

Adam Weiss: I mean, it's a, it's a big question. I think what's caught my eye now... So I've always felt that the publishers in the channel are on the cutting edge of innovation.

Adam Weiss: They're the ones who are often thinking about what's next, whether it's in terms of technology, how to drive traffic, how to convert consumers. Um, and now with the rise of AI, um, we're finding that a lot of these affiliate publishers are the ones who are showing up in those citations. Once again, whether intentional or not, leading the charge.

Adam Weiss: But I would say the intentionality, is that a word- ... um, is becoming paramount, right? 'Cause the same way it happened with SEO, affiliates led the way in terms of how to optimize sites to show up in SEO to drive traffic for brands, and now they're doing the same thing, um, when it comes to, uh, are we calling it AEO, GEO?

Adam Weiss: Whatever it is-

Marcus Johnson: It'd

Adam Weiss: be nice ... they're doing it now as well. So that's what's, that's what's caught my interest.

Marcus Johnson: Yeah. Um, Ingrid, how about for you?

Ingrid Milman Cordy: Yeah, I think, you know, I was talking about this offline with Adam and, uh, you know, being in the D2C brand building game for many, many, many years at this point, I can almost say decades.

Ingrid Milman Cordy: Um, I think that affiliate has always been evolving and morphing and adjusting to whatever the climate is, and so I find it to be kind of the most nimble of the channels. So I think- Mm ... you know, right now, whether we designed it to be that way or not, it is something that we just can't ignore when we're thinking about LLMs and how we show up in GEO.

Ingrid Milman Cordy: Um, but even just the way that it has sort of like morphed and evolved as a channel into sort of like more than a channel, uh, I think is just a testament to its like nimbleness and ability to grow with the economy, with consumer preferences and needs.

Max Willens: Mm-hmm. Yeah. I think what's so interesting about affiliate, I, I think the word nimbleness, Ingrid, is great because it really is a sector where it does seem like every six months there's sort of a new little pocket of activity and, and sometimes that turns into a huge kind of pivotal component of the ecosystem.

Max Willens: Sometimes it doesn't, but it's, it's always good to kind of have your ear as close to the ground as you can keep it. And I think that the, the things both of you are saying about LLMs and AI visibility generally are super important, right? Like, uh, we are right at the very beginning of this. I mean, you know, we don't even know which acronym we're using yet.

Max Willens: Um- ... but it's, it's really striking to me when you look at the data that comes in from different sources. They, they really do validate the idea that affiliate content has a kind of strategically critical role that can, uh, you know, drive pr- uh, a lot of different goals and a lot of progress on a lot of different fronts.

Max Willens: And we're right at the very beginning of understanding how affiliate publishers can, can properly leverage that, right? Because one of the things that's historically been true about this space is that, you know, there have been some publishers that have been sort of compensated more justly than others, and I think that the kind of dawning AIV, AEO, GEO age is one that offers a really interesting opportunity to sort of reset that or at least, you know, gives some publishers a chance to get justly compensated for a really important role that they play in the, in the user journey.

Marcus Johnson: Mm-hmm. Um, you know, I want to go back to something you said. You said more than a channel. Could you expand on that a bit for me?

Ingrid Milman Cordy: Sure. Yeah. So I mean, defining a channel is just, you know, one way of interacting with a form of media- Mm ... to, you know, forward your return on investment, your return on ad spend, you know, whatever your, your particular goal is.

Ingrid Milman Cordy: The reason why I see it sort of expanding outside of just an individual channel is because when I think about affiliate, I think about it more largely as a strategy. So here's the message that I want to give about my brand, and here's the audience. And so affiliate as a whole allows me to sort of- Make that into an actual strategy that I can hit people in the awareness consi- consideration, bottom of funnel.

Ingrid Milman Cordy: So when I think about, um, the way that it's no longer a channel is I think about there's publishers, there's creators, there's social commerce, there's its impact on LLMs and GEO. There's all these sort of like tentacles that now- Mm-hmm ... live out, out, that have expanded out from like a traditional affiliate.

Ingrid Milman Cordy: And so to me that becomes, okay, well how do I now take this like souped-up race car and I use the right dials and modes and, and fuel sources and things like that, which to me feels much more like a strategy than an individual channel.

Adam Weiss: Mm-hmm. Yeah. I, uh, I completely agree with that, and I think it's, it's more than a channel because you have all these different partner types, and I like the race car dashboard sort of analogy.

Adam Weiss: I always talk about like a portfolio and your ability to sort of where you wanna lean heavy in, where do you wanna take some risks, right? What are the different things you're trying to achieve short-term, midterm, long-term. Um, and you can pull the levers in that portfolio, which are your publishers working closely with them as strategic partners to achieve those goals, whatever they are, or those KPIs, whatever they are.

Adam Weiss: Yeah.

Max Willens: Yeah, I mean I, I think one of the things that is smart about what both these guys are saying is that, you know, one thing that you've s- seen happen a lot is affiliate has sort of proven its ability to sort of, as you say, drive against a bunch of different kinds of, uh, or stages of the purchase funnel.

Max Willens: And I think a good kind of entry point into that or way to validate that is by looking at affiliate as a share of creator revenues, right? So like-

Marcus Johnson: Mm-hmm ...

Max Willens: basically we have a forecast that looks at sort of the revenue streams that creators, uh, draw on, and affiliate has grown as a share of their revenue more than any other revenue type over the last five years, and we expect that to continue happening for the next three at least.

Max Willens: And, you know, to me that only happens if it's a mechanism for doing business that works for the entire ecosystem, right? Like, if that only worked for the, you know, .01% or, you know, the, the bottom 50%, I don't know that you would see the same kind of, uh, gain in, in market share that you're, or in spend share I guess you could say.

Max Willens: And, uh, so yeah, I think that generally when you think about the traction that affiliate has, and also you can extend this out into other publisher types too, right? Like, the deals that content publishers, um, do as affiliates now are, are much richer and much more kind of dynamic than they were even a few years ago.

Max Willens: And so it- I think this just speaks again to what Ingrid was saying about how, like, it can be this sort of, uh, focal point or axis around which a lot of really important stuff spins. It's not just kind of one, you know, kind of tactical thing that you use- Mm-hmm ... to execute a discrete, uh, task, I guess.

Marcus Johnson: Affiliate invites engaged advertisers to work more collaboratively, uh, with their publisher partners. What are some ways you see publishers and brands working together today? Some novel ways.

Adam Weiss: Um, I think it's moving, you know, they're, they're moving beyond the sort of bottom-of-the-funnel transactional relationships.

Adam Weiss: Max was sort of just alluding to this, right? Mm-hmm. Where creators and as we saw a bunch of years ago, um, editorial content sites moving into the channel more top of funnel, creating brand awareness. I think there is a misnomer that affiliate is just bottom of the funnel, and I mean, Ingrid could validate it or tell me I'm crazy, but, um, I think brands are starting to look at it, not even starting, they are looking at affiliate as a way to engage at the top of the funnel.

Adam Weiss: Mm-hmm. Create brand awareness, educating the publisher partners who they are, what they do, tapping into them for things like product launches, et cetera. Um, and that's something that, you know, we might not have seen. You know, I've been around for a while, but you know, 15, 20 years ago, um, it really is a full funnel, if you will, strategy.

Adam Weiss: And I'm, I feel like we're seeing a lot more of that of late.

Marcus Johnson: Mm-hmm. Ingrid, any thoughts there?

Ingrid Milman Cordy: Yeah, I mean, HigherDOSE is a high AOV, high consideration product. We-- If we were to only use channels or strategies or investments that were bottom of funnel, we would have closed up shop five, six, seven years ago, right?

Ingrid Milman Cordy: Um, because we have to. It is mission critical to our business to start obviously with awareness and then get people to understand. So a lot of what we do, honestly, is education. Education about how to sleep better, education about what even these, like, technologies are. What is infrared? What is red light therapy?

Ingrid Milman Cordy: What is microcurrent therapy? What in the world is PEMF therapy? So all of those things are truly, like, our consideration funnel and, and how we get people to interact with our brand. Affiliate would have a microscopic space in our ecosystem if it truly were only bottom of funnel. So we use affiliate to educate, so there's a lot of publishers out there that have dedicated audiences and people whose or trust they've earned that we then partner with to make sure that they're getting the version of our story that we want told to the right audiences.

Ingrid Milman Cordy: So to us, that is such a n- natural integration for affiliate, which I think if you're looking at marketing in a, in a more traditional sense, you, you would never pull that lever. And for us, I think a lot of our continued success and growth has been in looking at affiliate as much more than just a bottom of funnel lever.

Marcus Johnson: Mm-hmm.

Adam Weiss: And that's, I would actually just add to that too, is that the publishers you're working with, the things Ingrid was talking about, um, i- in a sense, you know, they provide a third-party validation to some of these things, right? And some of them, a lot of them are experts in particular, um, categories or verticals, so they provide that validation as well on top of, you know, the work that, that someone like Ingrid and her team are doing.

Marcus Johnson: Mm-hmm.

Ingrid Milman Cordy: Yeah, 'cause you don't wanna hear it from, from me and my brand. You wanna hear it from these publishers who've gained authority and trust with these audiences. And so we lend our education to their audience, and we get their seal of approval, and it's a great, it's a great partnership.

Max Willens: And I think you can see that too if you look at data from across the internet about how...

Max Willens: 'Cause the LLMs, as they, more and more people use them for things like, uh, you know, consideration of pr- products or tr- just incorporating it into their shopping journey, what you see is that a lot of these LLMs, ChatGPT especially, seems to be growing more reliant on, on publisher content, not less, right?

Max Willens: Because they're, what they're constantly trying to do is calibrate, like, do we want most of the information to come from a brand's website or from a marketplace or from third-party publishers? And when you, I, I gave a presentation at Affiliate Summit East, uh, about a month ago now, and one of the slides in there came from our AI visibility index where we looked at the kind of share of domain types in queries for personal care and beauty, and the share of domains that came from publishers more than doubled.

Max Willens: It was basically one of every five domains cited in, you know, ChatGPT responses to personal care and beauty questions was from publishers, and I think that that just basically illustrates Ingrid's point, right, which is just that- When, uh, possible, people would much rather hear from, you know, passionate subject matter experts basically.

Max Willens: And over ti- over the last several years in particular, I would say that affiliate marketing has kind of created the conditions to create a whole ecosystem of publishers that are doing that, and it's g- been really interesting to see how that's evolved to suit basically, you know, both sides of the, of the marketplace for the last several years.

Max Willens: Mm-hmm.

Adam Weiss: Um, Max, that actually also reminds me of at the Awin Think Tank a few months ago, which you were at, Lily Ray talked about the impact that publisher sites are having on LLMs. Um, I think roughly 20, 25% of them were cited when, uh, someone does a search for best product, which really speaks to what you're talking about as well.

Max Willens: That's right. Yeah, she and I, uh, did a panel discussion after she pres- presented all of that. Yep. And, uh, we talked a bit about how... And what's so interesting is that, you know, these LLMs seemingly change the, the weights of what's in their, uh, responses every quarter or so, but that reliance on that kind of content seems like it's pretty durable, right?

Max Willens: Because at the end of the day, that's the kind of content that's hard to fix or to fake or to replicate, and there's a lot of reasons for that. But I, I think that that, those conditions are effectively proving to put affiliate content in a really strong position. There's a lot that needs to be figured out to make sure that everybody gets kind of compensated and rewarded in a, in a fair way, but I think that from a starting position, the affiliate publishers have a, a lot of kind of cards in their hand that they can play, uh, as, as things continue to shake out.

Marcus Johnson: Um, let, let's end, end with this, Adam. I'll go back to you first. H-how have improvements in measurement helped position affiliate as a channel that marketers can confident- confidently invest in?

Adam Weiss: Um, well, again, I think historically the measurements were around sales, orders, right? Um, traditional bottom of the funnel metrics.

Adam Weiss: But now I think, you know, there's a lot more sophistication around the reporting from an attribution perspective, top of funnel to bottom of funnel, looking at, um, multiple channels where affiliate fits in within other channels as well. So advertisers can really understand what is happening in terms of, and using that to decide, "Here are the partners I wanna work with, and here's the way I wanna structure the economics as well based on what I'm seeing from an attribution perspective."

Marcus Johnson: Mm-hmm. And

Adam Weiss: I don't have to pay just on last click. I could pay on first if I want to. I could, uh, allocate, uh, tenancy or flat fees as well that perhaps come from my brand budget, and that all starts with the measurement. It's something that Awin has been very focused on. Uh, we have things like journey path reporting.

Adam Weiss: We have reporting, um, that gives insights into where publishers are showing up as it relates to the LLMs. But all of that I think helps sort of move the partnership strategy, the affiliate strategy forward, um, as you think about, to Ingrid's point earlier, what levers to pull and what parts of the dashboard you wanna move.

Max Willens: I mean, I'd be curious just to ... I, I, I f- I feel like, you know, the fact that, um- You know, Ingrid who sits in charge of, you know, the, uh, commercialization of a product that costs what it costs, uh, you know, wouldn't be so, I think, kind of bought in if it was only something that you could y- you know, use last click to, to measure.

Max Willens: I- one thing that I think is really interesting, even though there's a lot that still needs to kind of happen there, is there's been a ton of effort in the last couple of years to sort of find a way to make affiliate appear and, uh, kind of deliver a stronger signal inside of m- uh, media mix models. You know, I think that there's some, some MMMs that are better at this than others, but there, there has been some real effort to sort of figure out a way to prove out that this is driving the impact that it's driving beyond just the, you know, immediate sales like Adam alluded to.

Max Willens: So there's a lot there again that, like, is kind of in motion, but I, I think it's, it's gonna be interesting to see where that, uh, progresses over the next, uh, couple of years. Mm-hmm.

Ingrid Milman Cordy: Yeah. If you know those MMMs, I'd love to talk to them.

Max Willens: We can talk about it off mic.

Marcus Johnson: Ingrid, let's end with this. Uh, any advice for folks listening in, um, who are thinking about making affiliate a, a bigger part of, of what they do?

Ingrid Milman Cordy: Sure. I mean, I think first making sure that we are understanding everything that we've all just talked about, which is it's not just this bottom of funnel transactional thing, although it works great for that, and please continue doing that if it's working for you, but to think about it more broadly. Um, one thing that I would recommend for, like, other brands is hire someone, whether it's AWIN or not, an agency or a partner that understands the intricacies of this really complicated channel.

Ingrid Milman Cordy: Um, there, there are so many, like, networks and ways of measuring and things like that that, like, honestly we need help with even with the kick ass ... Am I allowed to say ass on this podcast? Kick butt. Um, the kick butt people on my team, we, we ha- just have a natural, um, great partnership and relationship with our, our AWIN team.

Ingrid Milman Cordy: But anyone who can help you navigate the complex and growingly complex waters of, of affiliate is, is really critical.

Marcus Johnson: Yeah. Um, excellent note to end on. Uh, thank you guys so much for, for being around today. That's all we've got time for for this episode. Uh, but thank you so much to my guests. Thank you first to Max.

Max Willens: Always a pleasure, Marcus. Thank you.

Marcus Johnson: And to Adam.

Max Willens: Thanks for having me.

Marcus Johnson: And Ingrid.

Ingrid Milman Cordy: Good luck, y'all.

Marcus Johnson: And to the production crew. Stuart runs the team and Dan Yu runs video. Thanks to everyone for listening in to Beyond the Newsletter Marketer podcast. Video podcast made possible by AWIN. We'll be back on Monday, but until then, of course, have the happiest of weekends.