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Summary
Sept 2019 (Vol. 59, Issue 3): NEUROMARKETING

Analyzing the Click Path of Affiliate-Marketing Campaigns: Interacting Effects of Affiliates’ Design Parameters with Merchants’ Search-Engine Advertising
Online service providers increasingly use multiple channels for their advertising. Within that universe, an affiliate—usually a small, private company or individual maintaining a website or blog—informs others about a product or service sold by a partnering company (a merchant). “One compelling combination integrates affiliate marketing with search-engine advertising, research trio at University of Hagen, Germany, observe. “The affiliates’ design parameters and the merchant’s parallel search-engine advertising both influence the click paths of users in an affiliate-marketing campaign, which runs from clicks to sales.”

In this study, Rainer Olbrich, Patrick Mark Bormann, and Michael Hundt found that the merchant’s simultaneous use of search-engine advertising, however, “cannibalizes clicks and sales in the click path.” As a result, “affiliates must use different text links to ensure positive impacts on clicks and sales in their affiliate-marketing campaign.”

“Many studies have examined the influence of one channel on another, but there is no consensus about the influence of search-engine advertising on other channels,” the authors note.

During a period of five and a half months, this study examined two online channels of a merchant—an education service provider for professional economic and information technology training (and therefore a high-involvement service due to its high cost). The research included the perspectives of:

  • “Affiliates, which seek to measure the number of advertising impressions and advertising media (text links) used during the survey period;
  • “The merchant, for which the focal measures pertain to its parallel search-engine advertising activities (ranking and click-through rate of an ad campaign during the time affiliates promoted its services);
  • “Users, who provide measures of the click paths (clicks, leads, and sales – a method drawn from a 2016 study).”

Among the findings:

  • “Search-engine advertising might cannibalize the effects of an affiliate-marketing campaign.
  • “Merchants should evaluate the overall effect of both channels.
  • “The rank in search-engine advertising has no influence on the click path. Merchants should aim for lower rankings to decrease their costs per click, keeping in mind the risk of weakening the effects of search-engine advertising.
  • “Using different text links in affiliate marketing can increase the effects in the click path.
  • “Using more advertising impressions in affiliate marketing can increase the effects in the click path.”

Read the full JAR article here.