[Written in partnership with Indoleads, but the editorial team had full control over the content.]
Social media natives are no strangers to influencer or key opinion leader (KOL) marketing where a product or service is promoted by an influential person. Malaysia even has a KOL academy for anyone interested in being one.
Influencer marketing can help small businesses gain visibility and reach new and larger audiences online through people with a notable following. It can also impact website or e-commerce traffic if theres a link attached, and possibly sales conversions too.
However, this isnt the only way to get a brands name out there. There are other methods for ads on social media for direct sales conversions. One solution is affiliate marketing.
But isnt affiliate marketing just influencer marketing?
Yes, and no.
Both focus on connecting with influential people in your respective industry that can help spread the word about your products. But there are some differences.
Influencer marketing is when a company pays a person with a large audience to promote their products or brand. In these campaigns, the payment is usually upfront, and the influencer is paid for a post, shout out, or mention on predetermined social platforms.
Meanwhile, affiliate marketing has three main players:
- The merchant;
- The affiliate marketer;
- The customer.
The merchant can be the creator, seller, or owner of the product. Affiliate marketers can come in the form of bloggers, YouTubers, and influencers.
They help advertise products or services of the merchants they work with to generate sales and earn commission per sale, or per click. This is done through an affiliate link that directs customers to the product or service of the intended sale.
Setting up an affiliate programme from scratch can be a hassle, especially without the know-how in the industry. Hence, for small businesses to make use of this marketing opportunity, it would be easier to go through an affiliate marketing platform, such as Indoleads.
Indoleads is an affiliate marketing platform headquartered in Malaysia, with a presence in India, Brazil, Vietnam, Hong Kong, Russia, and Latvia. With Indoleads, merchants don’t have to pay any upfront fees as payments are only made to affiliates when they receive the campaigns results.
We spoke to Sergey Gaydar, whos Indoleads founder and CEO. He shared, Our experience shows that our advertisers start increasing their sales up to 30% from the first month [of using affiliate marketing].”
To summarise, affiliate marketing uses some form of influencer marketing. These affiliate links should be carried through an influential platform for them to be seen by an audience in the first place.
Isnt my small business too small for affiliate marketing?
Size doesnt really matter.
Of course, there are some categories of products, otherwise known as niches, that are not as easily promoted as others. This can be due to its specific features, high cost of the products, or overall consumer behaviour patterns.
For example, costly products within the e-commerce niche or financial products in some countries are traditionally more difficult to promote than clothes, FCMGs, and software. This tends to be due to users needing more time to think about committing to an expensive good or service which might impact their financial responsibilities.
Currently, Indoleads observed that the top niches for affiliate marketing include e-commerce, software products, online education, and mobile apps.
Sergey also shared some insights on which kinds of products and services work best for affiliate marketing, based on Indoleads global network.
|Country||High performing niches for affiliate marketing|
|India||Beauty and lifestyle e-commerce|
|USA||Fashion and marketplaces|
Trends will still change according to the times, meaning that these niches wont necessarily be high performing all the time, and vice versa.
Unstable times will always make people take a closer look at financial products that can help them go through troubled times, Sergey noted.
OK, Im sold on affiliate marketing, where do I start?
The team at Indoleads recommend starting with a few simple steps:
Step 1: Choose a niche market
Figure out who your products should serve. If you think the answer is everyone, then narrow it down to target a more specific group of people.
We can break this down in a million ways: gender, interest, age, etc., said Sergey. “The narrower it gets, the better a company can serve that particular group of people, and the easier it will be for affiliates to make a decision on the programme.
Step 2: Check out your competition
Companies should analyse the strengths and weaknesses of their competitors affiliate programmes, and identify how they structure their affiliate commissions. From there, they can figure out what works best for them.
Step 3: Determine your commission structure
When deciding how you will pay your affiliates, every company should keep in mind what theyve learnt from the competitive analysis and make their commission structure more appealing.
Indoleads will help clients determine the commission percentage based on the cost of the product or service, with the average effective cost per acquisition (eCPA) being US$9.70 (RM40.95).
Step 4: Choose your network or build a programme on your own
If a company has proceeded with all the previous steps alone, at this point its time to decide: will you create your own programme or use an existing affiliate network?
Most businesses often find it challenging to create their own programme, as it requires technical knowledge in programming.
Also they wouldnt want to focus on the routine and prefer to do what theyre actually good at, providing excellent products and services, Sergey added.
Thus, Indoleads offers a simplified solution for companies. This means brands can promote their products and services, increase their sales, and save time on building a programme while managing thousands of affiliates simultaneously.
The onboarding process on Indoleads is rather simple too.
Once a brand applies as an advertiser, Indoleads team will reach out to them and negotiate the terms and commission structure. An agreement is then issued, followed by the necessary tech integration on a brands channels.
The time to complete tech integration rests mostly on the client completing the tasks and they could be ready within a day, Sergey noted.
Thus far, Indoleads website states that it has driven US$500 million in revenue annually for its clients, has over 2,000 registered premium advertisers, and over 30,000 registered and verified affiliates.
It can be said that affiliate marketing might make it easier to measure your campaign results, since brands are basically tracking conversions through an affiliate marketer. Social media marketing can get complex with its multiple platforms and varying reports, where reach and engagement don’t necessarily translate to sales.
Both have their own advantages, and most brands may opt to use them in tandem. At the end of the day though, it comes down to what a brand’s goals are (brand awareness, sales, etc.), and which solution can better cater to these goals.
- Learn more about Indoleads here.
- Read about other Malaysian startups here.
Featured Image Credit: 123rf.com / Vulcan Post