The best way to know whether your affiliate channel measures up is by the use of KPIs. Key performance indicators allow you to focus on specific aspects of your business to determine if they are high enough to be called successful. However, not all KPIs are the same – and not all of them will be applicable at all stages of your brand’s life.
Once your affiliate channel is up and running, the best way to monitor if it’s performing well is to measure its various elements through a number of KPIs or key point indicators. KPIs are great tools in determining whether your affiliate channel is thriving or not, but only if you are using the right ones. Good KPIs allow you to measure what really matters in terms of affiliate marketing, while “false” ones make you focus on seemingly important data that really doesn’t contribute to the big picture. When it comes to weighing in on your average affiliate channel stats, consider the following which are considered as quality KPIs:
- ROAS (Return on Ad Spend). At some point, you will realize that a particular affiliate channel makes a great return on ad spend. If it does, then you might even find yourself the means to fuel your marketing budget.
- Clicks and/or Click Attribution. The affiliate channel you have should work by boosting traffic going to your site. Your role is to find out all there is to know about all of those clicks, including the different types of traffic sources.
- Average Order Value. A high AOV is attained when you have excellent consumer campaigns. One example is by having an attractive stretch and save offers as well as free shipping, which everybody loves.
- New vs. Returning. It’s always good news when you have a steady flow of newbies in the channel, and affiliates can be further utilized when incentivized if they help to bring even more in. You can also think about providing higher commissions for affiliates that are tasked with introducing others to the site.
- Sales Percentage Generated by Affiliate Channel. A healthy channel is one that steadily increases in sales, which then provides you with even more means to continue funding affiliate channel efforts. This is a sound move because marketing professionals know that marketing on performance will always yield good things when done right, as well as encourage constant accountability.
- Revenue Growth. While high stats are always great, take caution not to focus so much on the revenue that your brand suffers. Are you willing to uncover your policies right in the affiliate channel? This is something that you should seriously think about.
One also needs to remember that different brands select a handful (and not all ) of affiliate channel tracking tools KPIs that really do tie in with brand-specific strategic objectives, otherwise you will be looking at all sorts of numbers that do not really tell you whether or not you are closing in on the targets you have set for your business. At the same time, you might be focusing more on one particular KPI than others. For example, if your current concern is budget, then you might be concentrating more efforts into ROAS. If you are keen to stay on the side of caution and have risk-avoidance as your current primary objective, then your goal is to balance out all your traffic sources – which means focusing on the Clicks and/or Click Attribution KPI. If you want to bump up your general growth, then your important KPIs are revenues, clicks, and AOVs.
Focusing on just a couple of quality key point indicators (KPIs) is helpful because when you have too many of them, you might find that some of them are working against each other. Always make it a point to re-assess from time to time the essential KPIs that you need to reach current strategic goals. As your brand scales new heights and encounter various challenges, always go back to your list of KPIs and see if what you were looking at are still applicable or you need to refocus on a couple of new ones.