The ultimate goal of both affiliate and ambassador marketing is the same: match your brand’s products and services to consumers that need and want them, ultimately driving profitability.
While the two approaches can overlap on more than just the overall premise, they certainly contrast in some key areas. There are plenty of pros and cons to both, and deciding which marketing strategy to deploy depends on the stage of your brand and what you’re trying to become.
Differences between affiliate and ambassador marketing
Affiliate marketers are focused inward on your current customer base. They have a strong influence on their close circle of friends and family. Put simply, it’s word-of-mouth marketing on steroids.
When done well, affiliate marketing does an exceptional job of mobilizing your current user base to drive peer-to-peer sales. It creates a system that allows your most satisfied consumers to promote your products within their circle.
Ambassador marketing is focusing outward on people who have influence in the communities where your consumers exist. An ambassador ties a well-known face to your brand but typically does not have nearly the close personal connection to your consumers as an affiliate.
The investment differs significantly between affiliates and ambassadors as well. Affiliates are far more cost-efficient. They receive a commission when sales are made with no up-front compensation. Ambassadors often require a rather large financial commitment before helping grow your brand.
There is also a larger amount of distrust with ambassadors than affiliates. If your trusted neighbor of 20 years (affiliate) asks you to try something, you’re likely to do so. If a well-known figure you don’t have a personal relationship with (ambassador) asks you to try something, it’s far less of a certainty you’ll follow their suggestion.
With ambassadors, it’s important to remember your values as a brand will become aligned with the values of your ambassadors. So before you bring on an ambassador, you have to do your homework. If what the ambassador stands for does not adequately align with your company, it’s obviously not going to be a good fit.
Affiliate impact examples
E-commerce beauty brand Glossier is an excellent example of leveraging highly successful affiliate marketing. Their history of leveraging affiliates begins with founder and CEO Emily Weiss starting beauty blog Into the Gloss. The blog encouraged users to share tips and tricks, creating an interactive community in the process.
The conversation among readers eventually led Weiss to start Glossier with Into the Gloss as its content curator. Into the Gloss’ dedicated community quickly blossomed into Glossier’s word-of-mouth marketers. It didn’t take a large financial commitment to any prominent names or faces to turn Glossier into a brand that recently received $52 million in venture capital.
“If you can penetrate the peer-to-peer communications that individuals have and mobilize your customers to influence those conversations, you have the potential to become a Glossier. You become a massive company because you’re not focusing on forcing and just bludgeoning someone to try your product.” — John Max Bolling
The referral program for Mizzen+Main, a clothing company specializing in performance menswear, is another great example of affiliate marketing at its best. Each referral an affiliate brings in that spends at least $100 gains the affiliate store credit. That specific credit is currently $125 and the friend you referred gets $25 off. Such attractive incentives have allowed Mizzen+Main to turn its loyal customers into effective marketers. Mizzen+Main has also grown into using the ambassador approach with a collection dedicated to NFL star JJ Watt.
Ambassador impact examples
Ambassador marketers can be far more recognizable and in the public eye. It’s for this reason due diligence is incredibly important when it comes to hiring an ambassador marketer. Again, it’s not going to work out well if the image of your ambassador doesn’t align with your brand.
Gymshark has successfully carved out its place as a top e-commerce fitness apparel and accessories brand with help from its 14 athlete ambassadors — nine males and five females — on the payroll. Gymshark ambassador Steve Cook has more than two million Instagram followers. If even a small percentage of his followers become Gymshark customers based on his suggestion, that’s huge for the brand.
Nike recently made headlines by making Collin Kaepernick the face of its “Just Do It” ad campaign. Kaepernick has been a controversial figure since the former NFL quarterback began kneeling during the national anthem. Nike, however, felt the projected gains within its consumer community far outweighed any potential backlash that would come with making Kaepernick an ambassador. So far, the results of that decision have been positive for Nike.
A controversial figure as an ambassador isn’t always obvious from the beginning. Sometimes, controversy comes only after an ambassador is already the face of your brand, which can be especially damaging. James Charles — the first male ambassador for Cover Girl — came under fire in 2017 for a tweet many perceived as offensive. The ordeal obviously reflected poorly on Cover Girl and shows one of the top potential pitfalls of ambassadors.
How to get started
Affiliate marketing provides the best of both worlds because of its expansiveness. Brands can go a mile wide and a mile deep just within the five best friends of a single individual. Ambassador marketing becomes essential once you’re at a place where broad brand recognition beings to really matter. Mizzen+Main is a great example. Their referral program helped grow the brand to a point an expensive ambassador was necessary.
Let’s start at the beginning and look at the important first steps necessary to build an effective affiliate program.
1. Map the customer bell curve
Sorting your consumers on a bell curve is a great first step. This helps to identify the type of customers you need to be focusing your time and effort on in order to set up a strong affiliate consumer base.
The top end is roughly 20 percent of customers that spend the most and are already willing to serve as affiliates. This group doesn’t need to be convinced, but you do need to take steps to keep them happy with incentives (more on that later).
The 20 percent on the other end of the spectrum are typically going to be your discount junkies. They probably don’t know what brand they are currently wearing, but they can definitely tell you if they got it on sale. They are not your repeat customers and are not the people you want to be focusing on as potential affiliates. You do want their email, though, so you can exclude them from paid marketing activities going forward.
Then there’s the vast majority in the middle. It’s wise to divide that group and focus on the top half of those consumers. These are the people that can be persuaded to go through the process of becoming an affiliate. This is who will ultimately expand the top end of your bell curve if leveraged correctly.
2. Be thoughtful with incentives
What are you doing to incentivize action from your affiliates? This could be free giveaways, discounted items, or access into the company.
The Hustle, a business-focused email newsletter, has successfully used all three of these affiliate incentive strategies to push their subscriber list over a million in short order. They start by inviting new users to join their affiliate program just a couple weeks after signing up. By joining the program, users are given a personalized page to track their stats with The Hustle. This includes information on how long they’ve been a member, editions they’ve read, and friends they’ve referred.
Once you’ve hit four referrals, The Hustle declares you an official ambassador. You’ll receive some free stickers at 10 referrals, a free shirt at 25, and so on until 500 referrals get you free entry into events hosted by The Hustle. The incentives to become a highly influential affiliate grows from a few free items to actually feeling as if you’re a part of The Hustle.
“People don’t ever get used to free, but they do get used to discounts. That’s something to keep in mind as you’re developing a strategy for incentives.” — John Max Bolling
Once you’ve built a strong group of affiliates, it’s time to prioritize those who are most effective. Glossier doesn’t advertise it, but they prioritize the opinions of their most influential affiliates. They’ll post on Into the Gloss or Instagram to source their audience for opinions on a potential new product. Glossier then weights the feedback based on the level of affinity someone has with the brand. If an affiliate has pushed 300 people toward Glossier products, their feedback is going to be weighted more heavily.
Beyond focusing on how you’re incentivizing affiliates, you need to be aware of how your affiliates are incentivizing their peers. Ideally, the word-of-mouth approach from your most effective affiliates will bring customers in at full price. If that’s not possible, using your top affiliates to pitch a discount may be necessary and more effective. You’ll likely have to test both methods to gain knowledge of what works best for your brand and its affiliates.
If the discount approach is required, it’s extremely important to use your affiliates as your voice. The people who enter your consumer base because an affiliate provided them with the opportunity at a discount are a much higher quality customer than a discount junkie fetching a code from a website.
3. Tools to power affiliate program
If needed, there are some very useful tools at your disposal when you’re looking to build an affiliate program. Ambassador, for example, is a one-stop shop for brands looking to leverage the right consumers for marketing success. Mizzen+Main is one of several thriving brands Ambassador boasts as a client.
Ambassador is both convenient to use from all perspectives and very broad in its abilities. It’s just as easy for your brand to manage as it is for affiliates to track referrals. Not only can this tool help you gain the right new customers to grow your brand, but it can also easily help you identify which customers to retarget as your most influential affiliates or potential affiliates. Ambassador also has plans tailored to startups and small business, mid-to-large-sized companies, and even a customizable plan to provide unique experiences for different levels of affiliates.
“Ambassador has helped us grow our business by giving us an easy way to reach out to other customers,” said Mizzen+Main communications manager Jaclyn Bishop. “Most of our search is organic search, but nothing beats a referral from a loyal customer. Once they’re loyal, they spread the word of Mizzen+Main.”
4. Tools to track and measure success
“You can’t manage what you can’t measure.” — Peter Drucker
This is quite possibly the most important point in this entire article. The ability to track, measure, and understand the success you’re having is vital to running a productive affiliate or ambassador program.
This starts with having the ability to segment and measure cohorts, which is defined as a group of people with a common attribute(s). Within the cohorts, there are three attributes that should be measured above all else.
- First is the lifetime value of new customers who come in through an affiliate link.
- Second is the lifetime value of new customers that come in through an affiliate link with a discount involved.
- Lastly is the lifetime value of the affiliates themselves.
Possessing the data on this information is extremely valuable. Otherwise, you’re likely playing into a guessing game.
It’s often said that rising tides lift all boats, and that’s how your affiliate program should act. A successful program will not only bring new customers in but will also move customers further up the bell curve. It’s for that reason you should take this seriously. It’s something you should absolutely implement as a safeguard against the uphill battle with Facebook and paid media. Your brand is simply leaving a massive amount of money on the table if you’re not mobilizing your customer base.