The Dangers of In-House Affiliate Programs

This post contains affiliate links. Because this is an affiliate marketing blog, so, #duh. This means I have been, or can be if you click on a link and make a purchase, compensated via a cash payment, gift, or something else of value for writing this post.

The Dangers of In-House Affiliate ProgramsFor the purposes of this post, an in-house affiliate program is one run within the company and managed on a platform that only handles tracking and payment, rather than one run by the company but managed through a network. These are very important distinctions. Some of the best affiliate managers I know, and thus programs I'm in, are managed within the company and on a trusted network.

In-house affiliate programs always raise a big red flag for me, and with good reason. They are often (not always, but often) poorly managed, inefficient and slow to respond. I have worked with crappy network-housed programs. However, I have found that programs run in-house and using platforms or tracking software really do themselves a disservice. Traditional affiliate networks serve as neutral third parties, handling tracking and payments to the benefit of both affiliates and managers / brands.

Inexperienced Managers at the Helm

One of the biggest issues I've seen with in-house affiliate programs is inexperienced managers. Often a company just plops someone from their marketing team (or even social media team!) in the seat and hands 'em the keys without any sort of education or industry insight. This immediately spells disaster, in many cases.

The same company then says “drive well, or you're fired” so the affiliate manager does the best they can with what little they're given. They're expected to be profitable without driving up margins and always keeping the head honchos happy. This is not about the experience of the affiliates, this is about driving more traffic, bringing in new customers and paying as little as possible for those metrics.

The problem with this is that the affiliates are the ones who suffer. An inexperienced manager won't know how to address a seasoned affiliate who is wondering why their payments are months late. They won't understand how to forecast for growth, thus being prepared for increased payouts. An inexperienced manager won't be able to answer integral questions such as “What is peak season?”, “What are the best-performing creatives?” and “What are the best ways to promote?”.

Creatively Lacking

With in-house affiliate programs, there is a total dearth of creatives. Maybe a banner or two, and a link. Yeah, — as in single, solitary, solo, uno — link. There are no deep links, no landing pages, no personalized links. Just … one. Imagery is often a completely foreign concept — forget about lifestyle shots for Instagram or video to embed on a blog.

Oversight, Schmoversight

Look, a company doesn't know what it doesn't know, right? Right. And when a company doesn't know that in-house affiliate programs can be costly and damaging to a company's reputation, then they don't know how beneficial working with a trusted affiliate network, like ShareASale, can be.

In-house affiliate programs have no trustworthy way to manage issues such as fraud, tracking downtime and duplicate orders. There is a lot of room for error, especially when it comes to things like Trademark Bidding, Paid Search and more. If not carefully monitored, this seemingly minor issue could turn into an unprofitable program that could end up costing the company money.

Big affiliates, from corporate to big media, often eschew in-house programs because they have been burned. Lack of payment and lack of response are the quickest ways to kill a relationship with a great affiliate. Newer affiliates may continually join the programs because they don't know better or because they think it's their only option. But these affiliates are the ones who later turn their back on affiliate marketing because they, too, get burned. This makes the industry look shitty.

Affiliates as Bottom-Feeders

My friend and colleague Liz Gazer, when I was discussing this post with her, said “There's a gross misunderstanding that affiliates are just ‘bottom feeders' and don't need catering to.”

This is such a misconception companies have about affiliates and the affiliate marketing industry. Sure, there are some smarmy CPAs out there who are just in it to win it. However, there are also amazing, insightful and trustworthy content affiliates (Hiiiiii!!!) out there. Affiliates who actually give a shit about delivering information with integrity. We do need help. Affiliates do need our hands held a little, because we plan on turning around and telling our audience just how fucking fantastic your company is. We probably love your products, or thing they're really intriguing, and that's why we want to share you with our readers. Sure, we want to make a few bucks, but we're also in it for the passion of blogging in the first place.

Accuracy is Necessary

Enough cannot be said about how integral accurate tracking and payment are to the success of an affiliate program. When one, the other or both are off, it can translate into thousands of dollars of lost income for affiliates. These are people, real people, who put their time and energy into sharing and promoting companies through their affiliate programs. It's their livelihood, and when you start messing with people's money, you start messing with their lives. That is never, ever cool.

The reason big affiliate networks attract huge brands, outstanding affiliates and industry award-winning agencies is because it is their core business to provide the proper oversight to ensure tracking and payment functions are in place and working.

For companies who run in-house affiliate programs, processing affiliate commissions and fixing tracking issues may be considered low priority because they're time consuming and the understanding of their importance is not there. The end dollar is more important than the affiliate, and when that happens, it's affiliates who get burned.

When your affiliate marketing department thinks of and treats affiliates like myself like we don't matter, then your company looks bad, because your affiliate marketing team is an extension and representation of your company.


Author: Christen