Essential Accounting Metrics Every Affiliate Marketer Should Track for Growth
Do you know, that affiliate marketing has become the new trend and is growing rapidly, over 80% of brands use this approach to drive sales and build awareness about it. (AuthorityHacker: Affiliate Marketing Strategies)
However, as an affiliate marketer, no matter the amount of effort you put into creating marketing strategies for your client, there are chance that you will not get the desired outcomes unless you curate strategies based on the relevant performance and accounting metrics.
Working without major key performance indicators (KPIs) is like operating in the dark and can lead to various missed opportunities, ineffective resource allocation and ultimately lost profits.
Want to know what these KPIs are? In this article, with a team of experts from Offer.One affiliate marketing platform, we will take a closer look at these accounting metrics, so stay tuned to learn more!
Key Advertising Metrics for Affiliate Marketers
Let’s start on the advertising side, here are some of the key metrics advertisers should be tracking:
Return on Ad Spend (ROAS): If a campaign costs more to produce than it takes in, obviously, it won’t be a success even if it generates tremendous customer interest.
ROAS enables advertisers to calculate the effectiveness of their campaign by splitting the revenue attributed to the drive by the cost of the drive. This number can help evaluate success on many levels.
It can guide marketers on their spending choices, and also allow them to compare different digital channels or even individual affiliates to determine which delivers the most bang for the buck.
DO YOU KNOW? The global affiliate marketing platform was valued at $18.40 billion in 2024, it is expected to grow and reach $56.29 billion by 2031.
Sales Revenue: This metric shares the raw data to determine whether the sales are increasing or not. In the case of sales growth, the advertising teams can draw conclusions about the effectiveness of their marketing efforts, and the pace of this growth can help determine whether an ad is effective.
Teams can thus evaluate whether they are meeting their monthly sales targets, with the strategies. If not, it’s a sign to reevaluate the affiliate marketing campaign and determine where changes may be needed.
Click Tracking: One of the classic measures of the success of an affiliate program is tracking the clicks. Clicks are usually measured by counting how many visitors to an affiliate check out the content in banner ads, text links, deep links, and promotional or data feed links.
If a website is receiving a high number of referrals from affiliate sites, it can be concluded that the affiliate marketing campaign is working. However, not all clicks are created equal. Many people might click on an ad, but never perform any further actions. (Indeed, quite a few clicks can be accidental, especially when users are trying to close an ad.)
That’s why many companies choose to trust a more sophisticated set of data than just the raw number of clicks. The click-through rate more effectively helps them judge how effective an ad is by dividing the clicks an affiliate link receives by the number of impressions on that link. Therefore, it can be determined how many people are choosing to intentionally tap on the link while reading the content.
There is a possibility that a larger site might deliver many more clicks, but only because it has many more visitors, and this is exactly why CTR is important. They not only tell about the raw number of clicks but the percentage of readers that choose to visit.
Similarly, the conversion rate can help understand how many people are engaging with the content the way marketers want them to. This percentage can be calculated by dividing the number of people who perform the wanted action (such as buying a product after clicking) by the number of people who might potentially have done so (such as all of those who clicked, regardless of whether they bought). This percentage can help determine which links and ads are working best at generating the anticipated results.
Average Order Value (AOV). This number tells about how much the customers spend on average per order, and it is calculated by dividing total revenue by the number of orders.
Advertisers can compare this number from their total website orders and the number calculated specifically for customers who came to their site from an affiliate. Ideally, the affiliate number should be higher, thus indicating the effectiveness of the marketing campaign in bringing more valuable customers.
TRIVIA Amazon’s affiliate program is the largest affiliate network globally with over 900,000 merchants.
Essential Metrics for Affiliates to Track
On the other hand, talking about affiliates, the following are some key numbers to keep in mind:
Commission Rate: This informs about the amount you will receive for each referral or transaction generated for an advertiser.
Earnings Per Click: This is used to evaluate how much revenue can be expected from each click generated by a marketer’s ad. This can be calculated by dividing your commission by the number of clicks to calculate this figure.
This can help identify which advertisers produce the most revenue and enables you to select advertisers offering maximum affiliate earnings.
Average Payout Time: Affiliates should know how long they will need to wait to receive their revenue. Average payment times help with exactly that and provide information about the payment timelines.
Conclusion
Various numbers can help evaluate the success of an affiliate marketing campaign, but ultimately all of these numbers boil down to calculating whether a campaign and its links are effectively generating a high click-through rate, leading to sales or not.
