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Maximizing Social Media Influencer Programs with Dynamic Commissioning

Dec 27, 2023

Senior Director, Customer Solutions (EMEA)

There are social media influencers who make substantial, six to seven-figure incomes – in part or entirely – through affiliate marketing links. A rather simple iteration of such an influencer would be a fashion-focused individual who posts slick images of themself wearing a specific outfit, then provides affiliate links to those products for purchase. It’s a business model nearly as old as the internet itself. Refer traffic, refer a sale, drive revenue, and get a commission from the company that sells the product. 

 

Marketers looking to harness the power of social media influencers on TikTok, Instagram, or other social platforms have come to understand affiliate links as an effective means by which to get products in front of audiences while being able to track performance through influencer-specific links that tie activity back to a specific partner. If a particular influencer is driving measurable results and driving revenue, deciding to invest more in that influencer is an easy one. If another influencer isn’t driving revenue, it becomes an easy decision to drop them from your program. 

 

But the binary question of whether an influencer is driving revenue or not is only part of the equation, of an ever expanding set of capabilities of forward-thinking marketers running influencer affiliate programs. 

 

 

Introspection on Placements 

 

The question of whether or not an affiliate partner is driving sales has generally served as the gold standard for whether your partnership marketing efforts are working. If you’re placing affiliate links with RetailMeNot, and RetailMeNot generally drives consistent revenue, it would tend to lull most marketers into a half comma; revenue is being driven from our affiliate partner and thus I will continue to spend with that affiliate, no questions asked. 

 

The challenge here comes without further introspection as to why and where those links are performing. A standing affiliate page for someone visiting a page might be responsible for some percentage of their referred revenue, but what of the rest is being driven elsewhere in the ecosystem?

 

Truly intelligent partner marketing demands the evaluation of your spend with as much scrutiny as one would evaluate ad spend on a particular demographic set on a social media advertising platform. 

 

 

Going Beyond Flat Commissions 

 

When people think of affiliate commissions, they typically think of garnering some small percentage of each sale. Be it 5% or 10%, most affiliate programming relies on the simple math of passing back a chunk of the proceeds to the person responsible for the link that was clicked. 

 

But what if you could incentivize influencers with commissions that respond to performance? 

 

Let’s take our fashion influencer mentioned earlier who is pushing clicks to a Sunglass Brand Y. Let’s call them Tony. Brand Y sees Tony’s affiliate links are performing very well. Tony has consistent traffic flow and a relatively high conversion rate. For whatever reason, Tony’s audience is particularly interested in viewing and buying Sunglass Brand Y’s inventory. It’s likely Tony is thrilled seeing a high percentage of his audience purchasing sunglasses he recommended. They’re also seeing their affiliate income grow. But why would a marketer stop there? 

 

Certainly, it makes sense for Brand Y to continue to engage Tony to push their merchandise. It’s also possible, however, for Brand Y to go further than that. Brand Y can also incentivize Tony beyond single sales, and structure Tony’s commissioning dynamically based on factors such as cart amount. Brand Y could give Tony a specific sale code to entice his audience to buy multiple pairs of sunglasses, while simultaneously increasing Tony’s commission beyond the simple five or 10% he started with. Now Tony is super motivated to reach increasingly higher level commissions taking him from 10, to 12, then 18% commission based on his average cart amount. 

 

Dynamic commissions can be tied to any number of performance indicators. A marketer for a travel site could tie commission increases to the length of stay booked, accommodation type, or even the destination. A shoe retailer could tie commission increases to the threshold of the number of shoes purchased or a specific category they’re selling. You could even tie commission increases to the number of tickets sold to a special event, or pay out differing commission levels if the customer is new or existing. 

 

Affiliate marketing can be a great boost to sales, particularly in an uncertain economic environment like today. But where there is more money to be made, affiliate marketers must utilize every tool available to ensure every drop of juice is squeezed from their affiliate partners, and dynamic commissioning should be one of the tools in your kitchen.  

 

For more information on how dynamic commissioning can work in your brand’s favor, reach out at contact@partnerize.com

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