E-commerce is booming around the world. Mexico, India, South Africa, and Nigeria, are a few of the countries poised for enormous growth in the next year. And with worldwide e-commerce sales expected to reach $2.05 trillion by 2016, savvy online retail brands are looking to get in on the action.
One way to expand internationally and introduce your brand to new audiences is to tap into the power of global affiliate marketing. But this can quickly become a nightmare if you try to manage it in-house without the right experience or resources. This is why it's a good idea to partner with experts who know the ins and outs of affiliate marketing.
There are two main approaches that companies take to manage international affiliate channels: using an affiliate network-driven approach, and hiring a single agency to manage the program globally. Unfortunately, neither solution is ideal for a true global program due to market differences and partners not being willing to admit limitations outside of their primary markets.
The drawbacks to networks and single agencies
Expanding globally with the home-country affiliate network is often the easiest solution. But few networks are No. 1 or No. 2 in every country, so they're going recommend what they have, not necessarily what's best for the business. Additionally, these networks are typically non-integrated from an account management standpoint, and their influence and staffing vary by market. They may not even have a team on the ground in certain countries.
Similarly, an agency may promise global coverage, but you might encounter many of the same issues along with some new ones. No single agency has a market-leading affiliate practice in more than one region. Smaller agencies often claim that a single contractor working from home is an office or a presence. Conversely, large agencies may have people in every country, allowing them to promise a global team, but many of these local offices don't have a staff with affiliate marketing expertise. In this case, account teams are built by shifting people from other channels, such as display or paid search. The result is a confusing, disappointing approach to affiliate management that's usually reactive, not proactive.
Most brands struggle to find a method that allows them to work with the best people in each international market by combining a strong local presence with a true global strategy.
The ideal solution is a single-point agency that works with local partners. This agency can serve as your global quarterback to work with the best platforms, networks, and agencies for your business in each market.
Why the hub-and-spoke approach works
The hub-and-spoke approach to international affiliate marketing is similar to the business model of global airline networks such as the Star Alliance and Oneworld. These popular networks provide flyers with convenient worldwide reach and a seamless travel experience by connecting different airlines across countries. Although you buy a single ticket, other airlines do some of the flying where they have the best routes. Applying the same concept to affiliate marketing allows your company to partner with the best resources in each country.
Your point agency will concede that it's not the best resource for you in each market. Its objective is to convey your expectations to partners in other countries and help oversee the global strategy and partner consortium, which will likely include networks, SaaS platforms, and local agencies. Meanwhile, these global partners can use their local resources to develop strategies, recruit affiliates, protect brand integrity, and engage in other aspects of day-to-day program management.
For example, eBay has put this strategy into practice (disclosure: eBay is an Acceleration Partners U.S. client). The e-commerce giant works with different affiliate agencies in the U.S. and Europe to ensure the most comprehensive market coverage.
Once you find an agency that's willing to help you organize this a la carte approach to affiliate marketing, there are several ways to ensure you're targeting the best possible partners in each country:
- Seek out experts
Local affiliates and networks should have an understanding of the marketing challenges and cultural intricacies that are unique to that particular country. They should know the affiliate industry inside and out to help your brand resonate with that region's customer base.
- Keep things legal
With each international affiliate channel comes different legal challenges. Each country has its own laws related to affiliate marketing, taxation, and disclosures. Ensure each local partner understands the laws you'll need to comply with in that particular country.
- Go beyond affiliate marketing
If affiliate marketing is your only tactic in a new region, your program will be challenged from the start. Instead, your affiliate program should be a part of a larger brand strategy and complement other digital and traditional initiatives. This multi-channel approach will ensure your program is aligned with the overarching goals of your brand.
Just because an agency or network says it has coverage or claims to have mastered an affiliate market doesn't mean you should take it at its word. Ask the right questions, and find a partner that can leverage country-specific resources that work best for your program and brand goals. When you can pick and choose best-in-class partners in each region, you'll have a much better chance of growing your market share and finding new international customers.
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