Lately there has been much talk about how affiliate marketing fits into the overall advertising and marketing industry. There has also been an increased effort to bring major brand advertisers into the space and how to best introduce more key advertisers to the opportunities (and profits) we can provide as affiliates.
It has been suggested that we have outgrown the simple term affiliate and should now call ourselves performance marketers.
Overall, this makes sense. Few people I encounter offline understand anything about what it is that we do. So I conducted a small experiment. While I was meeting with a few people at a local business networking event, I described my company as a performance marketing company. Someone (thankfully) asked, “What’s that”? So I gave the following explanation:
“Performance marketing is where advertisers, working through an agency, place creatives with publishers who accept payment (generally via a neutral tracking network) as a result of consumer action on the advertising instead of an arbitrary payment based on possible reader/viewership”.
The reaction was quite interesting in that everyone in the small group instantly understood the model. The similarities to traditional marketing and advertising channels made sense to them.
They were able to associate their existing knowledge and experience with their own business advertising with what it is that we do without me having to give a larger explanation of affiliate marketing.
Then I added that 90% of what my performance marketing company does is online. I ended up making a couple referrals to friends in our industry that day; businesses that understood what we do and needed to explore creating an affiliate program for their companies.
That experiment in self definition occurred a couple months ago when several affiliate tax issues were front and center. This got me thinking about how our self definition as affiliates has been hurting us.
TV stations regularly air infomercials during the weekend nights on a performance basis. So do radio, cable, and sometimes even newspapers will do a hybrid deal (fixed fee plus a performance “commission” for coupons).
And why were those performance marketers “left out” of the affiliate tax law proposals? And what would happen if we describe our industry structure in the terms of the rest of the advertising and marketing industry?
It seems to me (and I am not a lawyer) that by reclassifying ourselves as performance marketers and describing our structure like the rest of the advertising and marketing community, that if and when affiliate tax legislation is being debated it would be more difficult to separate us from the larger performance marketing industry.
This would mean that online, TV, cable, radio, and print media would be affected along with us and that we can stand united to fight unfair and burdensome taxation.
We’re all performance marketers. Whether a performance marketing affiliate, performance marketing network, performance marketing agency, etc. It’s time to redefine ourselves as performance marketers to help others understand our businesses, create larger opportunities with brand advertisers, and to help mitigate being separated, targeted, and taxed unfairly.
Scott Medlock is the Administrator of the AffSpot Affiliate Forum and Blog
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Well said, but the term affiliate is still widely used so I don’t see it going anywhere…
Call it what you like but I am affiliate marketer and am not having trouble winning clients. Actually you are doing the rest of us a favor since it makes less competition for “affiliate program management”, “launching an affiliate program” and “outsourced program management”.
I think it was Seth Godin who said (or repeated) that its better to be #1 for a term than #2 for someone else’s.
Scott, We have definitely changed our approach from being only an affiliate marketer to a performance marketer. We offer more than just affiliate network management but also retargeting, pay-per-call through Ring Revenue, refer-a-friend technology and other opportunities that aren’t in any way tied to an affiliate network or publishing event. I don’t know if this will change the industries ability to dodge state legislators looking for incremental tax revenue, but I believe it more closely defines what we now do.
God post!
Scott,
I like your premise, especially if it helps bring clarity to the “outside world” and rightly brings more benefit to many small businesses. Among e-commerce and marketing professionals, I think they can better relate to anything that features the word “performance” if it connotes cost effectiveness in acquiring new customers.