The potential of affiliate platforms

In a previous blog, we explained the possibilities of a feed management tool such as Channable, but for which platforms should you actually build a feed? SEA specialist Wilco and advertising marketer Marc explain.

Marketplaces and affiliate platforms

We distinguish between marketplaces and affiliate platforms. A marketplace is a website where you can order a product. An affiliate platform is a website where you can list your product, but when the buyer places an order, they are redirected to your website. On an affiliate platform, the order is therefore placed on your own website.

An example of a marketplace is bol.com. On bol.com, users can view products and pay immediately. Comparison websites such as Vergelijk.nl are a typical example of affiliate platforms. The visitor compares various providers and, upon clicking on one of them, is redirected to that provider’s website to place their order.

Affiliate platforms

Affiliate platforms, then – we’ll explore these in more detail in this blog. Which platforms are there? How many are there, and what are their benefits? Let’s start by looking at the different types of platforms available. You can divide the platforms into two categories: comparison sites and affiliate networks. Comparison sites include websites where you can compare products and then place an order via a partner website. Affiliate networks are companies that have a large network of partners (websites) where your products can be displayed.

Which platform should you join?

But how do you decide which platform to join? The most important thing is to think carefully about the target audience you want to reach. Who are your (potential) customers and where do they look for products? Once you can answer that question, you can start looking at which platforms are a good fit. Suppose you have an online shop selling tech gadgets, targeting young men who are keen on the latest technical gadgets. In that case, you’ll want to join a platform that’s effective at reaching that target audience. You could also take a look at what your direct competitor is doing. For example, if their product is listed on kieskeurig.nl, you might want to list yours there too so that you can compete directly with them.

A second point worth looking into closely is the commission model used. Most platforms charge a fee for every visitor they refer who subsequently makes a purchase. This amount varies from platform to platform. With one, you might pay a 3 per cent commission, whilst with another it could be as high as 10 per cent. It’s wise to check this in advance and work out how much margin you’ll be left with. For example, if you have many products with a low margin due to a highly competitive market, does it really make sense to sacrifice even more of your margin for a lead? And how many extra sales does the affiliate platform need to generate before you actually start making a profit? These are questions that are extremely important when choosing a platform.

The pros and cons of an affiliate platform

Cost model

Many affiliate marketing websites operate on a cost-per-sale model. Under this model, you only pay when a visitor places an order with you via their link. A fixed percentage is often used for this.

However, there are still a few websites that use a cost-per-click model. Every visitor directed to your website costs a fixed amount, regardless of whether that visitor ultimately places an order.

In our view, websites using a fixed CPS model have an advantage over those using a CPC model.

Short timeframe – wide reach

If your own website is struggling to attract a large number of visitors or potential customers, an affiliate platform is a smart choice. You can then capitalise on the high visitor numbers of these platforms to drive traffic to your shop. Furthermore, any visitor who goes directly to your website in future, rather than via the affiliate platform, is a bonus.

You only pay for results

In the section on the pricing model, we already outlined the various costs that may be charged; the most common is cost per sale. You only pay when someone actually buys something from you. You pay for results. If the affiliate platform does not deliver ‘results’ for you, there are no costs involved.

Thwarting your own sales

Joining an affiliate platform can give your sales a boost, but would you not have secured those sales anyway? It’s obviously a shame if someone buys a product from you via an affiliate platform when they could have bought it directly from you. In that case, you’re giving up part of your margin. Perhaps you could have secured that lead much more cost-effectively with a clever Google Ads Search or ‘ Shopping ’ campaign. Or perhaps even with SEO. So you really need to think this through carefully.

So…? Go for it or not?

As you’ve read in the blog, this depends on a wide range of factors. There isn’t a standard ‘yes’ or ‘no’ answer. You’ll therefore need to assess, on a case-by-case basis and for each platform, whether this offers added value for you. The various costs and benefits need to be analysed in order to reach a decision. If you’re unable to work this out for yourself, we’re here to help as SEA specialists. We’d be happy to assist you in utilising the right channels for your online shop. This could very well be an affiliate platform, but of course it could also be one of our other services.