You’ve started an affiliate program, or you plan to start one. But how do you know if your affiliate sales are meeting expectations? As with all marketing campaigns, you’ll need to set specific, measurable and time-bound goals to track your affiliate program’s success.
But what are the most important affiliate marketing metrics to track? Which ones tend to be misleading or not very helpful?
We surveyed 29 affiliate marketing experts to get their insights and opinions. Below, we list the affiliate marketing metrics to keep an eye on. But first, let’s examine a few key statistics on tracking affiliate programs.
Most commonly tracked affiliate program metrics
First, we asked the experts which of these affiliate marketing metrics they track:
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Out of the 17 affiliate marketing metrics, 83% of marketing experts say the most popular metric to track is the total number of affiliate link clicks.
Ultimately, however, sales are more important to an affiliate program’s success. So it makes sense that after clicks, 72% of marketers measure conversion rates and 62% track the total number of purchases through affiliate links.
More than half of the respondents, at 59%, also monitor affiliate program revenue.
Interestingly, only two of the four most popular metrics – conversion rate and revenue – were among the metrics experts named as most effective.
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Frequency of tracking affiliate marketing metrics
How often do brands track their affiliate program metrics? About 38% track their affiliate program metrics weekly, and another 14% track them every two weeks.
This means a little over half of the marketers track affiliate program metrics more than once a month. Meanwhile, 28% prefer to track these metrics monthly, and another 21% track them quarterly.
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6 expert-recommended affiliate marketing metrics
The experts we surveyed highlighted six key performance indicators as the best metrics to measure your affiliate program’s success.:
- Conversion rate
- Sales per affiliate
- Revenue
- ROI
- Percentage of active affiliates
- Customer lifetime value (CLV) of customers from affiliate programs
1. Conversion rate
One of the most commonly used affiliate marketing KPIs, conversion rate is the percentage of affiliate link clicks that eventually result in a purchase. You can keep track of this metric to compare an individual affiliate’s performance and locate your top affiliates.
Plus, examining your average overall conversion rate can help you compare the effectiveness of your affiliate program to that of other marketing channels.
Why do experts find measuring conversion rate so helpful?
“Brands can brag about their sales, unique visitors, and rankings, but all of this information is a little vague without insights into the conversion rate.
“There are several ways to break down the conversion rate data to help businesses understand their weaknesses, strengths, and challenges. For example, businesses can measure the conversion rate of all affiliates on average, of a particular affiliate landing page, or a specific affiliate’s conversion rate.
“Having said that, high conversion rates don’t always mean affiliates are amazing marketers. They could also be doing something to hurt the brand image. On the other hand, a low conversion rate can mean there is something wrong with their landing pages, they are not able to get a business the targeted traffic, or they need more training about the brand’s products or services.” –Nathan Sebastian, GoodFirms
“Affiliate conversion rates can be used to judge individual affiliate effectiveness. If one affiliate has a conversion rate of 8% and another has a conversion rate less than 1%, attention should be given to the higher producing affiliate. Additionally, if an affiliate has a very low conversion rate (less than 1%), this may be evidence that they are doing something fishy with your affiliate links, such as click bait titles or maybe even unauthorized PPC campaigns.” –John Ross, CPA Exam Prep Insights
“Conversion rate is great for assessing the performance of a given affiliate. It’s easy to compare with other affiliates and other partners, as it’s not an absolute scale – it’s measured in percentages. I believe one should chase a great conversion rate rather than just clicks.” –Luciana Nitu, Planable
“Conversion rate says a lot about the success of an affiliate program as a whole. Internally, if you’re seeing a lower than average conversion rate across the board, it’s time to evaluate your offer and landing page. Do potential customers find your offer compelling? Does your landing page have a clear call to action? It’s important to work closely with marketing and any other touchpoints in the sales process to make sure your funnel is optimized.
“Externally, if a partner’s conversion rate is much lower than your program average, they may not be a good fit. It’s likely they are not promoting your offer to the right audience. Try to provide them with insight to what’s working in your program to see if that helps improve their conversion rate. If not, it’s okay to go your separate ways to protect your brand’s image.” –Cody J Murphy, Visual Oak
2. Sales per affiliate
Who are your top affiliates? Which affiliates have potential, but may need more assistance? Are any affiliates actually hurting your bottom line?
Tracking each affiliate’s sales over a given period gives you that point of comparison. You’ll be able to reward your best affiliates. You’ll also see trends in each affiliate’s sales over time and be able to investigate the reasons behind them.
Why do experts find measuring sales per affiliate so helpful?
“One of our favorite metrics to track is sales per affiliate trends. We have set up automated reports in Google Analytics for our top earning affiliates to keep track of their sales on a daily to weekly basis. This allows us to see if we need to reach out to the affiliate with sales, new items, or just to catch up and see where we can help them.
“It’s helped us catch issues too. A big affiliate of ours had about five days go by where our reporting showed no sales. We reached out to them and found that somehow an update on their website had broken our links. He resolved it immediately and sales jumped back again.” –Jeff Moriarty, Moriarty’s Gem Art
3. Revenue
Tracking how much your affiliate program earns seems like an obvious move, but many businesses get so wrapped up in measuring other affiliate marketing KPIs that revenue takes a backseat. This shouldn’t be the case.
Besides measuring affiliate revenue during a specific period of time, there are two other m beneficial ways to measure revenue:
- The first is the overall revenue growth of the affiliate program over time.
- The second is incremental revenue, or revenue you wouldn’t have generated without an affiliate program, and that you can’t attribute to another channel (such as email or paid ads).
Why do experts find measuring revenue so helpful?
“Revenue allows me to decide which of my affiliates needs the most time and attention. The best earners are more likely to get exclusive discounts at a more generous rate and qualify for stock/products to demonstrate and review. On the flip side, lower-earning affiliates will receive coaching on steps they can take to improve their likelihood of generating conversions.” –Eleanor Bennett, Logit.io
“Analyzing how your affiliate program is affecting revenue growth is very important in understanding how useful it is to your company. Measuring this over time gives you the ability to see where it is falling short of expectations and where you may need to put in work to improve it.” –George Birrell, TaxHub
“Incremental revenue from affiliates is the most important because that’s what you’re after in the end. Affiliate partners bring you more business, which is your goal. Incremental revenue tells you exactly how much you’re generating with your affiliate partners, as it only counts independent sales provided by the partner.” –Michał Suski, Surfer SEO
4. Return on investment (ROI)
Return on investment (ROI) is sometimes referred to as return on ad spend (ROAS). This is the revenue you generate from your affiliate program after you’ve covered the costs of your program (i.e., affiliate commissions, the cost of affiliate program software or an affiliate network, the salary of an affiliate manager, if you have one).
You could calculate ROI by simply subtracting program costs for a given period from the revenue generated in that period.
Or, you could dividethe total revenue earned from the affiliate program by how much it costs to determine what you get back from every dollar spent. If your result is a dollar, you’ve broken even, as a dollar spent is a dollar earned.
Why do experts find measuring ROI so helpful?
“There are lots of ways to spend marketing dollars. Tracking ROI lets you know if affiliates are working for you, or if you need to find some other way to market.” –Francesca Nicasio, Payment Depot
“Return on investment is the bottom line. All the other metrics matter and they’re interesting and even important to track. But ROI sums up everything else.
“If your ROI is poor, then you can consider your other metrics to see why it’s failing. If your ROI is excellent, you can gain insight into why you’re succeeding so you can employ those methods in other marketing strategies. Return puts everything else in perspective. It shows us if what we’re doing is even worth it.” –Melanie Musson, AutoInsurance.org
5. Percentage of active affiliates
You may have a lot of affiliates registered in your program, but how many of those affiliates are actually putting in the work and generating leads or sales? Measuring your percentage of active affiliates tells you exactly how many affiliates are helping to increase your bottom line.
Why do experts find measuring the percentage of active affiliates so helpful?
“Tracking the percent of active affiliates gives you the best insight on how to reach maximum sales. You can have a wide audience but still not get a lot of attention due to a higher portion of the affiliates not being active in promoting you.” –Chris Prasad, JookSMS
6. Customer lifetime value (CLV) of customers from affiliate programs
Customer lifetime value (CLV) is the revenue a customer brings in throughout the years they remain a customer, minus the initial cost of acquiring them.
If a customer acquired through an affiliate becomes a loyal customer, they not only cover what you spent to acquire them, they also bring in much more revenue throughout the years.
Loyal customers pay dividends, so it’s helpful to know which channels bring in your most devoted customers. How does your affiliate program stack up to other channels?
Why do experts find measuring customer lifetime value so helpful?
“In order to understand the value and ROI of your affiliate programs, you need to know how much a customer from the affiliate channel is worth to you. By knowing the CLV of customers coming from affiliate programs, you will be able to calculate whether it’s a viable strategy for your business.” –Jonathan Aufray, Growth Hackers
8 other affiliate program metrics to track
These metrics weren’t mentioned by any of our experts, but we see benefit in using them to track your affiliate program’s success.
1. Average order value (AOV)
This is the average amount customers spend when they make a purchase through one of your affiliate links. If you sell many products with different price points, this average order value (AOV) helps determine whether your affiliates are drawing in higher-value orders. And regardless, if your AOV is consistently high, you’ve hit the sweet spot and your affiliates are reaching an ideal audience.
2. Cost per affiliate sale / cost per lead
How much are you spending to get those all-important affiliate sales? Measuring how much you pay to secure each sale, and comparing this to the cost of other marketing platforms, can help determine if your affiliate marketing efforts are worth it.
If you’re a B2B with a longer sales cycle, and you’re paying affiliate commissions for qualified leads, you might also measure cost per lead.
3. Leads from the affiliate program
How many leads does your affiliate program bring in over a given time period? Out of all the leads your business gets, what percentage of these come from affiliate referrals?
4. Customers from the affiliate program
In a similar vein, how many new customers can you attribute to your affiliate program in a given period? Out if all your current customers, what percentage of them have come from an affiliate referral?
5. Overall engagement
Engagement is a slightly complicated metric to track, as it involves a series of metrics to see how much “attention” affiliates are giving your brand. Here are a few engagement metrics to track:
- Number of visits to your website that originate from affiliate links
- Number of affiliate links created that lead to your site
- Number of conversions affiliates generate
6. Rate of return / rate of cancellation
This is the percentage of purchases made through an affiliate link that are returned or canceled. Rate of return is measured to analyze the performance of individual affiliates and their links.
If a significant number of purchases made through an affiliate link are returned (say, over 10%), this is a sign something isn’t aligning in your affiliate program. An affiliate could be over-exaggerating the benefits of a product so they can earn a commission. Maybe they aren’t promoting to the right audience. Or worst of all, they may be engaging in affiliate fraud.
7. Share of sales from your top affiliate bracket
According to the Pareto principle, about 80% of your sales come from 20% of your loyal customers. The same is often true of affiliates – it’s very likely a top bracket of high-performing affiliates will bring in a majority of sales.
Knowing the share of sales that come from your top affiliates can help you validate and construct a strategy to invest more time, money, and energy into these affiliates.
First, you’ll have to decide what makes a top affiliate in your program. For example, are they affiliates responsible for at least 5% of sales, or are they the top 10% of your affiliates?
8. Affiliate contribution margin
An affiliate’s contribution margin is the revenue brought in by an affiliate minus the cost of recruiting that affiliate.
You can calculate this metric for each individual affiliate, as an average of all your affiliates, or do both.
What makes the contribution margin different from other metrics? It accounts for the recurring revenue an affiliate is responsible for, if an affiliate brings in a repeat customer. It’s similar to customer lifetime value (CLV), except it examines all of an affiliate’s contributions to the business.
In a way, the contribution margin is the average “lifetime value” of affiliates. It’s also similar to ROI, except it specifically looks at revenue and costs associated with individual affiliates.
5 affiliate marketing metrics that can be misleading
The experts we surveyed told us the following affiliate marketing KPIs can be unhelpful or misleading without the right context. If you choose to track the following metrics, it’s advised to do so with care.
1. Earnings per click (EPC)
“Many affiliate marketers speak highly about EPC. But in reality, if a brand has trademark bidders, coupon poachers, adware companies, etc., their EPC is bound to be high.
“One of the prime examples of why EPC is a bad metric is the self-shoppers. They may click on the link once and start shopping. Such single clicks to shop will increase the EPC to a significant amount. Also, if the self-shoppers make two or three purchases in a single click, their conversion rate will be in the 100% multiples and their EPC can be in the thousands or higher. This will offset everything. Therefore, in reality, a high EPC can actually be misleading.” –Nathan Sebastian, GoodFirms
On the other hand, “say, an affiliate partner launches a new blog. They’re a huge influencer in your industry, they have a following, and immediately get large amounts of traffic. Being an affiliate partner of yours, he places your product on one of the pages. Because the traffic is so great and we assume their subscriber count is well into the tens of thousands, the EPC gets offset. Not many people are going to make the purchase, as they just got introduced to the thing. But a lot of them might click through, making your EPC lower than in reality.” –Luciana Nitu, Planable
“I think earnings per click can be deeply dependent on the type of audience and product you are looking to sell. For example, if a product is $300 a lot of visitors may click because of the wow factor and may not convert because of the high retail price. But another product could attract higher earnings per click based on the product being much more affordable to the target audience. Overall revenue from purchases seems like a much better calculation to measure performance.” –Eleanor Bennett, Logit.io
2. Number of clicks on an affiliate link
Even though it’s the most common affiliate program metric marketers track, the number of clicks on an affiliate link can be very misleading without the proper context.
“The number of clicks isn’t useful if those clicks are not targeted or not qualified. Also, the total number of affiliate link clicks isn’t really useful if people visiting that link don’t actually convert. I’d rather have ten clicks and two sales than 100 clicks and zero sales. Focus on the leads and revenue you generate, not the affiliate traffic you get.” –Jonathan Aufray, Growth Hackers
“Total affiliate link clicks isn’t very helpful. Clicks don’t always correspond with purchases. Sometimes there are a lot of clicks and few purchases, and other times there are nearly as many clicks as purchases. Purchase information is more valuable than click information.” –Melanie Musson, AutoInsurance.org
3. Number of sales made through affiliate links
“Total purchases through affiliate links may not be very helpful to businesses, as a large number of purchases do not necessarily equate to a large revenue or profit stream. These purchases may be small item purchases with little profit margins. Thus, tracking this metric is unlikely to reap useful information. Instead, it might be more useful to measure the total revenue from affiliates.” –Emilia Wong, BumbleScoop
4. Impressions
“Impressions don’t really tell you anything except for how many times your banners were shown to your potential customers. This statistic is pretty much useless, as it doesn’t reflect the reality of your primary objective – sales. It tells you nothing about the performance or conversions.” –Michał Suski, Surfer SEO
5. ROI (in specific situations)
“The initial ROI can sometimes be misleading. It takes some customers a little more time to become familiar with a new program, so it’s important to give it time to build. Most experts suggest giving a new program at least three months before you begin to take the ROI seriously.” –Travis Killian, Everlasting Comfort
“When it comes to affiliate programs, I think return on investment and return on ad spend can be somewhat misleading. ROI and ROAS can be thrown off by certain underperforming campaigns, skewing overall results. In addition, assuming you utilize a commission-only affiliate structure, every penny spent is connected to some level of money earned. I think it’s better to zero in on affiliate-specific metrics to determine affiliate program success.” –John Ross, CPA Exam Prep Insights
Tips for acting on the affiliate program metrics
Now that you have an idea of what metrics to track in your affiliate program, how do you apply these metrics to improve your affiliate program’s success? Three of our experts shared some of their strategies and best practices:
Figure out how much you can afford to pay affiliates
“Get to know how much you can spend per lead. To do this, you’ll need to measure how much money you can make off each of them. If you’re a SaaS, measure the CLV. If you’re an ecommerce, look at the gross margin.” –Luciana Nitu, Planable
Check for fluctuations, and incentivize affiliates more during slower times
“Measure the affinity of your affiliates with your market by regularly analyzing if they target the market you want to get traffic in, and how often they promote you.
“And always check for sales fluctuations. Fluctuations may indicate that you need to fix a technical problem, your affiliates need help promoting your products, or a competitor submitted a better offer. Measure changes, find the cause, and take action to get the best results. Incentivize your affiliates even more during downtimes.” –Oliver Andrews, OA Design Services
Cut affiliates who hurt your program metrics
“After analyzing all relevant metrics to determine the effectiveness of an affiliate program, don’t be afraid to cut underperforming affiliates. Stick to the workhorse affiliates who have high conversion rates and produce large cart values. While many affiliate program managers think any affiliate sale is a good sale, sometimes underperforming affiliates can hurt your program.” –John Ross, CPA Exam Prep Insights
Wrapping up: Measure and apply multiple metrics for the full context!
Now you know which affiliate program metrics experts find helpful. You’re ready to decide which ones to track, how often you’ll check up on these metrics, what increments of time you’ll use to make your comparisons, and how you’ll apply your findings.
But be sure to select a wide range of metrics to get the context you need.
As George Birrell of TaxHub advises, “If you were to only measure one metric, you wouldn’t be getting the full picture of what has happened. This could lead you to believe something you’re doing is wrong or right, and could harm your efforts to get more customers. Using multiple allows you to gather insight into how one metric leads to changes in another.”
Using affiliate program software makes tracking metrics easy! Check out how Referral Rock can help you harness the power of affiliate marketing and scale your growth.
