Using affiliate marketing strategies without monitoring or measuring your progress is like being in the dark. You don’t really know where you are going. Although you may initially know where you are going, being unable to monitor your metrics will leave you wondering what direction your business is going to.
In order to avoid being directionless, you need to monitor how successful your strategies are and what strategies you need to eliminate. In this post, you will learn about the marketing metrics that you need to track and what tools you should be using to get satisfying results.
Keeping an eye on your affiliate marketing metrics will give you better insight on what is going on in your affiliate marketing strategies. This also gives you the chance to overcome any unpredictability that you might encounter. So if you are new to affiliate marketing, it’s best to familiarize yourself with these marketing metrics:
- The Clicks or Click Throughs – The click-throughs are the unique clicks that are sent through your affiliate links. For example, how many visitors were able to click on the links that are placed on your site that allowed led them to the merchant’s offer; the goal is to lead the visitors to click through.
- The Click-Through Rate (CTR) – is the ratio that compares views versus click on the links. Monitoring this as a percentage can help you define which types of links are working, ie. what gets clicks on more based on the same views.
- The Traffic or Visitors – specifically this is the number of visitors that viewed the page with your affiliate links on it. Site-wide monitoring isn't as important, but checking the visits is essential for calculating the CTR. The higher the traffic, the better the chances that you will send visitors to the merchant’s landing page and convert them. High quality content and good design can help you attract more visitors that will stay on the page.
- The Number of Impressions on Ads – this is a metric that reflects the number of times a user sees an ad. This could be an ad you are placing to get traffic to your site, or an ad that you are placing on your own site to send traffic to a merchant. It's useful to compare impressions to other metrics so you can evaluate the effectiveness of the ad placed.
- The Affiliate Commission Ratio – this refers to the amount received by you, the affiliate, for sending a visitor that turns into a sale or lead. These can range from as low as 5% up to 50% or more depending on the product type and how much the merchant is willing to part with. Some sites also have a much higher conversion rate (the rate as which they turn visitors into sales) so even if there is a lower commission ratio (eg. Amazon) they might have much higher conversion rate to make up for it.
- The Reversal Rate – this is the measure of the percentage of the reversed commissions caused by disapproval (usually due to refunds). Avoiding merchants that have high reversal rate can help you a lot.
- The Affiliate Ratios – this is an important metric used by affiliate managers to show the number of affiliates or publishers within the networks who are actively involved on a regular basis. You can use this as a rough guide on how well that particular merchant performs.
- The Commission Models – this refers to the metrics used in measuring the different commission programs used by affiliates to make conversions. Typically these are Cost Per Sale, Cost Per Lead, or Cost Per Action.
Benefits of Keeping Your Metrics in Line
So why should you keep track of your marketing metrics? For one, you make money. Two, you are able to see what strategies work and what doesn’t. You also see how many leads are converting and which marketing efforts are working best. This can lead you to save money in cases where you find something that isn’t working right. You also get to improve your (or your employees if you have them) performance so you can get more affiliate commissions in the future.
In short, even though there are many other metrics you can track, keeping an eye on the significant affiliate metrics above will lead to improvement.
If you aren't already, make sure you start tracking those metrics today. Improving your performance right now will do wonders in the future!