Are you tracking the right metrics as an affiliate marketer?
The productivity of your affiliates plays a leading role in how successful your affiliate marketing program will be. However, in order to track these types of results, you’re going to need to have an affiliate tracking system in place.
Affiliate tracking systems keep track of key performance indicators (KPIs), which are metrics that will help you determine if your program is working or not. With this being said, some KPIs are more useful than others, so it helps to know what you really should be tracking to avoid wasting your time.
Why KPIs are Necessary
By not setting KPIs, it becomes difficult to determine where you should be investing more of your time and efforts. All marketers want to be able to generate the highest return on investment but this will require you to break marketing platforms and methods into variables, allowing you to see which variables are affecting each other.
Your KPIs are directly linked to your budget as well as your profits, making them a must for all affiliate marketers.
Tracking the Right Affiliate Marketing Metrics
There are a number of metrics that you could be tracking but these are the most important for affiliate marketers:
- Visitor Conversion Rates. Conversion rates will tell you how often people are visiting your website and converting – this could be in the form of making a purchase, downloading a white paper or signing up for a newsletter. Understanding why new customers are converting will guide your optimisation efforts.
- Click-Through Rates. Analyse which of your links are performing well to determine the level of exposure that your brand’s receiving through your affiliate channels. Keep an eye out for high click-through rates by low conversion rates – this could indicate inaccurate tracking or a broken link.
- Reversal Rate. How many of your affiliate conversions are being cancelled after a conversion has taken place? If your reversal rate is high, it could be a sign that certain affiliates are not sending quality traffic to your site or that they’re targeting the wrong audience.
- Ad/Link Impressions. It’s important to know how often your ads or links are showing up to determine the percentage of people clicking on them.
- Cost per Click. Calculating the average price you would pay per click or sale will give you a good idea of whether or not you want to invest more into affiliate marketing and which channels you should be investing in too.
- Affiliate Revenue. Another way to determine whether you should be investing more or less of your budget in affiliate marketing is to compare the revenue generated by your affiliate marketing programs with your other campaigns and marketing efforts.
- Traffic. How much additional traffic are you generating since the launch of your affiliate marketing program? If you haven’t seen any significant growth after a year, it might be time to reconsider your approach.
- Return on Ad Spend. This metric looks at the cost of running your affiliate marketing program versus the total amount of revenue you’re generating for that same period. How much are you really earning after your investments?
Now that you are aware of what needs to be tracked, the easiest way to keep all of this data in one place is to create a custom dashboard using your preferred analytics program, KOBIT and Google Analytics being two of them.
Tracking your metrics on a regular basis will be crucial to the success of your affiliate marketing campaigns. The clearer the picture of what’s working, the easier it will be to spend your budget more strategically.