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Referrals are some of the most powerful forms of promotion a business can receive. In today’s digital space, two proven ways to create these types of recommendations for brands are through influencer marketing vs. affiliate marketing.
Here, we’ll break down how influencer marketing vs. affiliate marketing programs work and compare their efficacy.
Affiliate marketing is a promotional program geared toward driving traffic and acquisitions for businesses. Affiliate programs supply digital users (known as “affiliates”) with unique URL IDs (known as “affiliate links”) that reward affiliates when they bring in new customers or sales.
Many businesses offer affiliates a percentage of the revenue their links generate. Anyone can apply to be an affiliate, but individuals with large and engaged online followings generally benefit most from the programs.
Influencer marketing is when a social media personality, like a YouTuber, Instagrammer, or blogger, creates content for a brand. The content is usually designed to promote a message, product, or service in an organic, authentic way.
Influencers will sometimes include affiliate links within their content but, as a fully-integrated, customizable advertising campaign, influencer marketing offers a wide array of messaging and branding possibilities that affiliate marketing does not inherently provide.
Below, we’ll take a look at the advantages and disadvantages of both influencer and affiliate marketing to find out which one makes the most sense for businesses.
Influencer marketing is a strategic approach that allows brands to select influencers, build relationships, and shape how they’re being promoted and portrayed to consumers. With proper planning, a well-executed influencer marketing campaign can lend this kind of control and customization to a business’s direct-response and branding marketing efforts.
Influencer marketing is driving results for many types of brands by connecting them with users across the most popular social media channels and platforms. Earned media value for influencer marketing increased by 1.5x in 2016 from the previous year with certain advertiser categories averaging over $14 for every $1 spent. Over 60% of millennials buy influencer-endorsed products (vs. celebs) and over 75% of younger demographics aspire to be YouTubers or vloggers for their careers. These are just some of the reasons that marketers have been increasing their influencer marketing budgets, dolling out a staggering $1 billion per year on Instagram alone.
Influencer marketing’s effectiveness is owed to its targeted approach. Because of this, the process of executing a successful influencer marketing campaign requires proper strategy, planning, and execution.
Brands looking to make an impact in today’s social landscape must be prepared to find and vet influencers, collaborate on content and messaging, as well as manage schedules and launches. However, by partnering with a well-established influencer marketing agency, brands can transfer these steps to experts in the industry.
While affiliate marketing costs can be minimal, so can the return on investment (ROI). On the other hand, executing a successful influencer marketing campaign often drives bigger results but also requires a larger investment of both time and money.
With the right strategy and team, brands can create influencer campaigns that meet and exceed desired key performance indicators (KPI). However, brands must be willing to invest time and money in order to capitalize on the enormous ROI opportunities influencer marketing presents.
Businesses adopting an affiliate marketing approach don’t have to invest a lot of time or money. Creating a program with unique URL ID(s) to track traffic and reward affiliates is a relatively straightforward process.
Business Insider analyzed a study showing that affiliate marketing was one of the four biggest drivers of online sales. Another study cited by Cision claimed that up to 40% of Amazon’s revenue — arguably, the largest affiliate marketing company in the world — came from affiliates. Moreover, digital publishers are seeing up to 15% of their revenue from affiliate marketing.
It should be noted, however, that setting up a basic affiliate program does not guarantee results. Many businesses use some form of influencer marketing as a means of driving affiliate traffic.
Affiliate marketing isn’t designed as a cohesive message or campaign, so affiliate links often lack direction or compelling calls to action (CTAs). As a result, there is no assurance that an affiliate program will properly target or reach relevant consumers. Additionally, affiliate links can sometimes be buried in captions, descriptions, or at the bottom of posts, which readers or viewers may not see.
Lack of control
Virtually anyone can apply to become an affiliate, and typically there’s not an in-depth screening process used to vet affiliate applicants. Due to this, brands may have little or no control over who is promoting their goods or aligning themselves with their brand. This in-cohesive approach can also result in a complete absence of messaging or, in some cases, the wrong kind of messaging by affiliates.
Affiliate and influencer marketing are both beneficial tools by themselves, but they’re even more powerful when used together. If affiliate marketing alone isn’t generating the revenue a brand is looking to attain, consider working with a qualified influencer marketing agency to help create a synergistic affiliate and influencer marketing campaign that can drive positive results.