Digital marketing today includes a wide range of channels that are vying for investment. With a myriad of ways for consumers to connect with brands, the bar has been set higher than ever for channels to prove their value. For brands to intelligently invest, it is important for them to truly understand the value each channel delivers. In this vein, CJ set out to measure the incremental value that the affiliate channel delivers to brands.

Using test and control methodology, we split a population of 20.2M shoppers into two groups with only one difference between them: the test group had an affiliate click. We further controlled for brand awareness, seasonality, and time to conversion.

We found that overall, when a shopper interacts with the affiliate channel, they are more likely to purchase, spend more with each purchase, and make more subsequent purchases. Furthermore, we also found that shopper interaction with the affiliate channel positively affected results for both new-to-file and return customers.

These results are validation that the customer-centric approach of the affiliate channel is providing value to consumers as well as brands. Consumers seek out publishers to help answer questions around where to buy, what to buy, and how much to spend. This third-party perspective lends credibility to brands with whom a consumer may not be familiar, leading to higher new-to-file rates. Repeat customers also benefit from an unbiased resource. Affiliate marketing provides incremental value because these wide variety of customer needs are met through publishers who provide this information and make consumers confident in their choices.

To put these findings into practice, brands should invest more in the affiliate channel to leverage the confidence publishers bring to shoppers by credibly meeting consumer needs - which results in higher conversion rates and spend, across both new and repeat customers.

Definition of Incrementality

Incrementality is a subset of the overall value that was measured. It focuses on the additional value the channel provides that would not have occurred without the channel present. Incrementality asks the question, 'Did that set of marketing touch points influence customer actions (knowingly or unknowingly) to drive more value?' Incrementality for any marketing channel is about successfully influencing shopper behaviour and meeting consumer needs such that you gain more value with the channel versus without it.

Incrementality is not attribution. Attribution is a transaction level analysis that allows you to model the impact of multiple marketing touch points for any given transaction. Incrementality, on the other hand, looks at the consumers/people who drove those transactions; it looks at the behaviour of these people and how having a certain marketing channel in the mix impacts your business outcome. Incrementality is a measurement of behaviour across groups and is independent of an attribution model. Understanding incrementality can help you create a better model for attribution.

Definition of Methodology

This incrementality study used the widely accepted test and control methodology. The test group of users exhibits the behaviour that is under study: in this case, affiliate clicks. The control group of users are similar to the test group, but the only difference is they did not click on any affiliate links during the testing period. By analysing the differences in behaviour between the test and control groups, the impact that affiliate clicks have on key performance metrics can be measured.

Data Origin

Brands included in this study are highly recognisable household brands, with a combined total revenue of approximately US$31B.

Definition of Groups

Study Controls

Brand Awareness

The Non-Affiliate Shopper group members had to at least visit the brand’s site during September 2018. This controls for shoppers’ brand awareness. It also controls for the fact that these shoppers are in market and already know about the brand.

Seasonality

Both groups were observed and measured during the exact same time frame.

Time to Conversion

Both groups were given the same amount of time with which to engage with the affiliate channel or brand, as well as to convert. The Affiliate Shopper group was measured up to 30 days from their affiliate click(s). Similarly, the Non-Affiliate Shopper group was measured up to 30 days from their site visit(s). This 30-day period allows both groups of shoppers an equal opportunity to convert and controls for potential differences in time to conversion.

Metrics Used