With more than half of U.S. consumers trusting affiliate marketing, the channel is a critical component of advertisers’ digital mix for those looking to build confidence amid growing concerns over privacy and digital safety. Yet despite this trust, many marketers hesitate to embrace affiliate marketing fully. Key concerns include managing affiliate relationships, doubts about the channel’s scalability and, most importantly, a lack of understanding regarding how to measure incremental impact on overall revenue.
Fortunately, these challenges can be addressed, particularly the critical issue of measuring affiliate marketing’s incrementality. Let’s explore why incrementality is essential and how brands can assess the true impact of their affiliate programs.
What is incrementality in affiliate marketing?
Incrementality refers to the additional value generated by marketing efforts beyond what would have happened organically. While incrementality doesn’t have a universal characterization, in affiliate marketing, it is often measured by how much extra revenue, traffic or engagement a partnership generates. Crucially, incrementality isn’t one-size-fits-all; it’s defined by metrics that align with a brand’s key performance indicators (KPIs).
For some, incremental value might be tied to revenue growth, such as a higher average order value from affiliate-driven transactions. For others, it could mean new customer acquisition, such as tracking first-time visitors from affiliate links or determining if those visitors return to make future purchases.
Why incrementality matters
Understanding incrementality allows brands to make smarter, data-driven decisions about where to invest their marketing dollars. Knowing which affiliate partnerships drive incremental value can help marketers:
- Ensure their efforts are moving the needle beyond what would happen naturally.
- Identify which partners drive the most incremental traffic or conversions.
- Evaluate which affiliate touchpoints lead to faster or higher-value purchases.
By focusing on incrementality, brands can refine strategies and maximize return on investment, making affiliate marketing a key driver of overall business growth.
Breaking down data silos for better insights
Marketers today have access to abundant data, but much of it remains siloed within its respective channels, including affiliate marketing data for advertisers that measure success within the confines of their partnership platforms. Without integrating affiliate data into reporting sources of truth, it’s impossible to gauge the full impact of affiliate marketing. By merging affiliate program metrics with existing analytics and attribution platforms, marketers can gain a clearer picture of how partnerships offset the cost of primary sales and marketing channels while contributing to overall business performance.
Integrating affiliate channel data into advertisers’ reporting source of truth supports incrementality measurement such as:
- Increased traffic: Are my partners driving more visitors than they had prior to a new initiative, platform migration or as compared with a previous period?
- Speed to conversion: Do consumers convert faster when influenced by an affiliate?
- Higher average order value: Are affiliate conversions consistently higher than the e-commerce average?
- Lifetime value: Do affiliate-driven customers show higher loyalty and lifetime value compared with those from other channels?
How to measure incrementality
Measuring incrementality requires a tailored approach and looks different for brands that are measuring success exclusively in their partnership platforms versus those that are leveraging a third-party attribution and analytics provider. For brands relying solely on affiliate reporting, key questions to ask include:
- What happens if I stop working with a specific partner?
- How does reallocating budget between partners affect results?
- Which partners drive the outcomes most aligned with my KPIs?
For brands using more sophisticated analytics and attribution systems, incrementality measurement can go further. By tracking affiliate performance within the broader marketing mix, brands can assess how partnerships compare with other channels in terms of traffic, conversion speed, customer loyalty and earned media value.
Maximizing incrementality with dynamic payment models
Advertisers that have defined incrementality as relates to their brand can progress to designing and deploying affiliate optimizations that drive to their goals—a strategy that requires sophisticated tools for partner payments. One effective way to do this is by implementing dynamic payment structures, enabling advertisers to automate event-based rewards tied to performance, so partners are equitably compensated for the value they provide. This ensures that partners delivering the most incremental value are rewarded accordingly.
In today’s competitive landscape, measuring the incremental impact of your affiliate marketing program is crucial. Brands can no longer rely solely on standard metrics; they must assess how partnerships contribute to growth, drive key outcomes and align with broader business objectives.
By defining incrementality on your own terms and integrating affiliate data into your overall analytics framework, you can unlock the full potential of affiliate marketing.
Want to learn more about driving incremental value through partnerships? Download Partnerize’s e-book “Incrementality and Partnerships: Measure Affiliate Success on Your Own Terms,” and discover how to take your affiliate program to the next level.
