October 20, 2023

Why launch an affiliate program now?

Mosaic Blog

60% of brands coming into Mosaic are starting their very first affiliate program from scratch. These brands are launching into the affiliate space, leveraging Mosaic to guide their trajectory and propel them forward. Why, all of a sudden, are so many brands starting partnership programs you might ask? It’s really quite simple. It’s because time and time again, affiliate proves itself to be the most efficient and effective way to market across the board. If you need some more convincing we’ll share our top reasons why brands and marketing managers are turning to affiliate marketing now more than ever before. View our one sheet here.

#1 ⅓ of brands rate affiliate marketing as one of their top 3 revenue streams

According to a survey by eMarketer evaluating the main revenue sources for brands, almost 10% of marketers said that affiliate marketing is their number one means of generating revenue and over 30% of respondents said that affiliate marketing is within their top 3 sources of revenue. E-commerce as a whole took the cake for the top revenue generator for the majority of brands, but it’s important to consider that there’s significant overlap between e-comm and affiliate and it’s likely that a large portion of those e-commerce sales were actually affiliate-driven but the brands didn’t take this into consideration when responding to eMarketer’s survey. For that reason it’s safe to assume affiliate marketing is even higher up on the totem pole than this survey indicates.

#2 Affiliate marketing is one of the primary revenue drivers across digital marketing channels

In the US specifically, affiliate marketing accounts for 16% of all online orders, but when looking at marketing done through digital channels alone that percentage jumps up to 30%. This means that in terms of the quantity of revenue coming in, affiliate marketing is on par with paid search and social media marketing, but the ROI is what sets it apart from the rest.

#3 The average ROAS for affiliate programs using Mosaic is 10x

The most common payment structure for affiliate marketing is CPA, or cost per acquisition, which is a fancier way to say you pay an affiliate for each sale they generate. That being said, an affiliate might attract 1,000 new customers to your site and out of those 1,000 let’s say 100 end up making a purchase. You won’t pay that affiliate for the 900 other clicks on your site, you’ll only pay for the ones that resulted in sales. And that’s precisely why affiliate programs, on average, achieve $10 in revenue for every $1 spent on commissions. In contrast with other digital marketing methods, this is unheard of. For reference, a ‘good’ ROAS for Facebook is 4x ($4 revenue for every $1 spent), 2.5x for TikTok, 2.8x for Instagram and 2x for search ads through Google

#4 Prices for digital marketing are on the rise

We get it, prices for just about everything are on the rise, but when you’re already taking a hit with the cost of your materials, distribution, and labor, you don’t need to also be paying more than you can afford for marketing. The popularity of social-commerce has driven digital marketing prices through the roof in recent years. A report by Insider Intelligence reveals that over the last two years, Facebook’s CPM went up 16% and Instagram’s increased by 55%. Across the top social media platforms you can expect to pay well over $10 CPM, and keep in mind that $10 does not guarantee any sales, it is just ensuring your ad gets pushed to 1,000 users’ feeds (and we all know everyone scrolls through the ads). 

#5 Affiliate conversion rates are 3x higher than social media

Affiliates in Mosaic have an average conversion rate of 3.09% while Instagram ads is a measly 1.08% so it’s simple to say that affiliate marketing is a superior spend for your money. It’s efficient, it’s effective, and it’s the direction most brands are heading in.

Regardless of your industry, your audience, or your products, there’s a place for your brand in affiliate marketing. There are hundreds of thousands of publishers out there with the potential to reach larger audiences than you could imagine and bring your brand to life in new ways, so take a leap of faith and start investing in your brand and in affiliate. Take charge of your brand’s revenue and launch your affiliate program with Mosaic today.

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