Like any other sales channel, the affiliate part of your business needs plenty of attention in order to grow. The way you provide that attention depends on your company’s current status, goals, and perspective on affiliate marketing.
When it comes to affiliate management, there are two main options to explore: an in-house affiliate program manager or an outsourced program manager (OPM). When determining which solution is the best fit for you, focus on these 5 points:
- Cost
- Experience
- Relevance to your business
- Connections in the affiliate ecosystem
- Scalability
You shouldn’t evaluate these 5 elements separately, but rather take them all into consideration when evaluating affiliate management. Here’s a brief analysis of how each of these 5 points affects the two approaches you take to affiliate program management.
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Cost
When it comes to cost, having an in-house affiliate program manager is typically more effective than hiring an OPM. However, as the program scales up and you need to get additional people to do the work, you may reach a point where it becomes more reasonable to hire an OPM agency.
If you’re a start-up company, you should definitely go with an in-house affiliate manager to develop an understanding of how affiliates can work for you. If you’re an established company, the extra cost of an OPM will also reflect the greater results you can get and the shorter ramp-up time for the program.
Recommendation: Dependent on your company’s budget and maturity.
Experience
You want the people that take care of your affiliate program to be as seasoned as possible and know the affiliate marketing business very well. Whether your affiliate program is just starting or your goal is to optimize and grow an existing program, you definitely want to have an experienced person to take care of matters. Unless you prefer to do it yourself in the beginning to develop an effective affiliate model specifically for your business, there’s no doubt about it—you will be better off with an agency’s expertise.
Recommendation: OPM agencies have experienced affiliate managers that can get the best results.
Relevance to your business
Suppose your company sells B2B software services. When having to choose, would you rather hire an affiliate program manager or OPM that only handled physical goods, or would you go with one that has at least some experience in the software field? I think the answer is pretty straightforward.
Recommendation: Find an in-house affiliate program manager or OPM agency with relevant experience.
Connections with affiliates
This is a very important aspect of your affiliate model, and appropriate connections should come along with being relevant to your industry. If the affiliate program manager or OPM has previously worked with companies that offered similar products to yours, then they’re bound to have strong connections with affiliates in that area. But just having the relationships is not enough. Try to determine the strength of these relationships with affiliates. This is important because it will determine the program manager’s ability to influence possible power affiliates to promote your products.
At the same time, keep in mind that some affiliates promote almost any kind of products –- discount websites, online catalogues, etc. These affiliates and their managers may be able to help out by expanding your reach, rather than your quality of relationships.
Recommendation: There’s not a clear choice here. Make your decision based on individual program manager or agency relationships.
Scalability
Once your program gets bigger, you will need to increase the amount of effort put into it. This can ultimately mean getting more people on the job. If you have an in-house program manager, then at some point you should consider complementing their efforts with an OPM agency. Or simply start with an OPM agency, after finding out how they can scale to run your program at the desired performance parameters.
Recommendation: OPM agencies are more scalable than in-house affiliate program managers.
Conclusion
To wrap up, I would say that in the final run you should always have at least 2-3 options to choose from, whether that’s different agencies or different in-house candidates. Choose your most important criteria from the list above, and then see which approach has the most strengths for your business.
