[ 00:00:00 ]Warm welcome to today's Partner Marketing Podcast. What is the UK's industry buddy Atma and what are the key findings from its recently published industry report, which is unique in our global industry? Answers to these questions and further insights into the partner marketing industry will be shared with you and me by Kevin Edwards. Kevin is the founder of Atma and with his extensive experience of the channel, a thought leader in our industry. Let's get started. Welcome to the Partner Marketing Podcast.

[ 00:00:35 ] Welcome, Kevin. Great to have you here today. Thank you for having me. You are founder and MD at Atma, the Affiliate and Partner Marketing Association. What has inspired you to found the Atma? So I was working for Affiliate Network for Awin until February last year, so February 2023. And left without kind of really knowing what I was going to do next, I was going to take some time out and then it sort of sort of by accident happened, really; I've been speaking to over the years, I've made a number of contacts at other affiliate networks, as well as agency side, publisher side, and really sort of kicked off a conversation with a variety of companies about whether there was an appetite to try and create an association in the specifically in the UK for the affiliate.

[ 00:01:30 ] And there did seem to be quite a strong appetite. And so I said, well, kind of leave it with me; let me sort of put together a bit of a bit of a business plan. And a couple of months later, I came back and presented sort of my findings, my ideas to everybody. And everybody kind of felt pretty supportive of the idea. And I said, well, let's see if we can get it to market. I asked for some financial funding in order to kind of pay me for my time to get it ready for launch. And actually, what I found is that there was quite a significant amount of interest. Beyond that initial group of people that I spoke to, which was obviously very encouraging. And it just kind of snowballed from there, really.

[ 00:02:06 ] I think that had I known now what I know, I probably would have even done it because there's obviously been a lot of work that's that's involved. And it's one of those things that just snowballs, you know, you as soon as you do that, you then have to do this thing and then this thing and then this thing. And we now have like a fully fledged trade association in the UK and working through a variety of different projects and initiatives. And we have about 50 members now, paying members. And we have some supporting members as well, you know, media partners, legal partners, that kind of thing. So, and we also have like a really good cross-section of companies as well. So we have a variety of different publishers representing different publisher models.

[ 00:02:43 ] We have all of the major networks. We've got 12 networks and platforms, and a variety of different agencies as well, typically agencies that are focused in on the affiliate industry, you know, affiliate specialists. And we also have a variety of advertiser brands as well. So hopefully kind of a really good representation. We now have a governance board and we also have an advisory board as well. So, we have a 2024 roadmap that we're working through delivering on projects, which obviously we will iterate out into 2025. I think it's really exciting because for me, like as being CEO of one of the networks being involved, that gives us a voice and insights and a platform for collaboration that we didn't really have before. What is the, what do you think is the difference?

[ 00:03:32 ] Because before we always tried to do something similar, maybe through the IAB or through other bodies in other countries, but it never really worked like that. Why do you think for the APMA this is working so well now and is obviously solving a problem, a gap that we had before? Yes. So you mentioned, you mentioned the IAB, so various companies used to be members of the IAB. And it's, I'm talking about this from specifically from, from a UK perspective. And if I look, if I think back to what we did sort of 10, 12 years ago, there was a lot of a lot of good people that were working on initiatives and it was, it was quite difficult to build momentum because everybody's busy, everybody's got full-time jobs that they have to do.

[ 00:04:18 ] And so this, you know, fitting it in, in, in around their roles. But it just sort of seemed to work that we had a good group of people. We had quite senior buy-in within those businesses. Yeah. And we were able to achieve quite a lot of good work with support from the IAB. I think that, you know, over time that inevitably maintaining that momentum is quite difficult. And obviously with sort of various people moving into different roles, certain companies choosing not to renew their membership, it just kind of fell away a bit. And I think that there was a feeling that we had, we had tackled some issues specifically around voucher codes and downloadable toolbars and software.

[ 00:04:57 ] And that these were issues that we, that had presented themselves as being challenging to the industry that, that we, we were able to control and we were able to, to bring about positive change for. And I think that, I think there was a feeling that we, because we had tackled some of those issues that they had therefore gone away. And as, as we know, in, in any kind of walk of life, you know, new problems emerge or just because you've, you've solved this problem here, it doesn't mean that it's not going to change and morph into something, a different problem over here. Yeah. And so obviously what, what we found is that, or what I recognized was that there was still lots of things that we could do and we should do as an industry, but there wasn't really a collective way of being able to do it.

[ 00:05:39 ] So we, we did manage to kind of get a few projects out of the door. There was something that we did around tracking, which all the networks contributed. We had about eight networks contributed to that, which was outside of the IAB. We did a couple of surveys, but it was very difficult. There were kind of things that I organized in my spare time around my, my full-time job. So, you know, I finally then had time and space to actually think about how to do this properly, you know, setting up as a not-for-profit. What does that mean legally? You know, putting together like a, a, a membership agreement, a code of conduct. And as I say, what I found is that there was a lot of goodwill and a lot of interest in doing it.

[ 00:06:17 ] So, you know, you, we obviously can't do it if companies don't support it and don't want to be involved. And the fact is, especially in our industry, I think it's so important with so many different players being involved that we, that we communicate with each other, right. And that we, that we have some kind of channels where we can tackle issues like on tracking, on voucher codes, on cashback, on all these different topics that we have in the industry and that we find some kind of like joint way of, of dealing with them. And that was obviously missing, right? Yeah. And I think what's really interesting is one of the, so we've just released a piece of research, which I think we're going to come and talk, talk about, talk about it in a few minutes.

[ 00:06:53 ] But the piece of research we asked. In that research about specific challenges that brands and publishers are facing. And what was interesting is, is the issues that we picked out were issues that are kind of like big macro issues that we not aren't necessarily in control of, but we can react to. And I think what was interesting is, is if I think back to some of the issues that we tackled like 10, 12 years ago, they were issues that we as an industry could control. And so it was, wasn't easy to do it because you know, it's all of these things are complicated and complex, but we were able to kind of make positive decisions and bring about positive change.

[ 00:07:33 ] The challenge I think that we have now, and the reason why it's so important to have a collective voice now is because there are so many pressures on our industry that are external pressures, from regulators, from tech companies. And they are issues that can potentially have quite a negative impact on our industry. And so whilst we can't necessarily control them, we can all come together and agree how we try and mitigate them or how we try and tackle, we can how we can try and tackle some of them head on. Exactly, exactly. You mentioned the research you've been doing, another I think another very good example because we tried that so often and in so many different countries, like in Germany, for example, as well.

[ 00:08:15 ] But we have never come to a really good approach to that, that everybody was submitting the figures and that we get a full picture. But you have managed to do so, and in summer. Now you publish the APMA report, was that doing this report, doing this research, was that one of the key motivations you had from the beginning? Yeah, I mean, I'm a data person anyway, I've always worked quite closely with data. And I've always had a passion for trying to sort of get inside inside the data and really try and understand actually what's happening. But when we were creating the APMA, we held a series of workshops, we had one for publishers, one for advertisers, one for networks and one for agencies.

[ 00:08:54 ] And in those workshops, we asked; we started from the premise of asking a single question, which is, if a trade association could do one thing to help you to do your job better or help your team to deliver more effectively, what would it be? And we asked everybody to kind of put post-it notes on a virtual board. And we collated all of those things; invariably, there was a lot of crossover, there was a lot of issues that came up that were resonated with, with wide audiences across each of those workshops. And we aggregated all of those things. And we use that as our sort of starting point for our roadmap for this year. And one of the things that came through very strongly is that people wanted research; they wanted data; and they wanted insights.

[ 00:09:35 ] And so we made when when we were pulling all of these items together, and all of these projects together, it became clear that some were going to be bigger projects than others. And so we had sort of some cornerstone projects. And the research piece was a cornerstone project. And then it's a question of, okay, so what do we do, you know, if you want data, what is that data? And one thing that I was, I really wanted to do for a long time is try and scope the size of the UK affiliate industry. Again, we did it about 10 years ago, and we did it very comprehensively about 10 years ago. But it's an expensive piece of work, it was done by the IAB and the IAB couldn't justify the cost of continuing to do it.

[ 00:10:18 ] And you had some other external partners doing that, right? Like analysts, companies, lawyers, and stuff. So we, I because obviously, we're collecting subscription was collecting, collecting membership fees. So, you know, we've got a pool of money that we can use. And I'd allocated a portion of that to hire a research consultant. So we'd initially gone out and so I'd spoken to a contact that had a PwC, I'd spoken to another economic modeling company, and both of them came back saying that this is going to cost you at least 100,000 pounds, which we didn't have. So. So I spoke instead to an independent consultant that somebody put me in contact with, and I said to him, 'Look, I said, we've got a pot of cash, so effectively, reverse engineering it, we've got this amount of money, what can we do for this?' And actually, what we were able to do was, I think, was was quite a lot with with that amount of money.

[ 00:11:09 ] I don't necessarily know whether the researcher would have taken it on, had he known how much work that was involved in it, but it was it was a great first project for us, right? It's the first first time we've done it. So it's a learning curve. And we'll use that. And in that information for how how we do it in the future, but we effectively focused in on three things. So I'd wanted to scope the size of the UK and affiliate industry, which meant coming to networks like Trade Up and saying, 'Can you give us your data'? I obviously was very clear to them that I won't see the data, it will be done, you know, confidentially happy to sign NDAs, etc.

[ 00:11:44 ] And that, for me was a really big challenge, because I thought, you know, this is sensitive commercial information that is being shared here. This is financial information, will companies actually want to feel secure about submitting it? That's usually the first big hurdle, right? Yeah. And fortunately, everybody gave us the data, one network gave us partial data, they basically said, 'we can give you a chunk of data, we can't give you all the data you're asking for.' And we said, 'Well, that's fine, because we can extrapolate from the data you've given us what we can model some some data points that we don't have from the data you do give us. The only piece of data that we were kind of missing. Yeah.

[ 00:12:21 ] Well, not the only piece, but looking at sort of what my perception of sort of mainstream affiliate marketing was, or is really the only major piece of data that we were missing was Amazon. And Amazon never give you their data, but they obviously publish financial reports. So we worked with, very fortunately, I was introduced to somebody in Germany who had previously worked at Amazon and was doing some independent consultancy of his own. And he was helping the German market to try and model their data. And he very helpfully helped us to try and model what he felt was an accurate picture of the UK program. So we're pretty confident that we've got the Amazon numbers pretty accurately. And then we obviously had all of the submitted data as well.

[ 00:13:06 ] So that was one chunk of the research. And that for us will become a benchmark, right? We're able to say the industry is worth x, it's driving x amount of sales, x amount of revenue. And we will try and do that every year. And we'll try and do it earlier next year as well to collect 20'24 data. Yeah. Retrospectively as well. So we collected '23, '22, and '21, so we were able to look at like year-on-year trends. And then there were two other pieces to the research. So that was our kind of quantitative piece. And then we wanted to do some qualitative work as well. So we had a publisher survey and an advertiser survey. And in that, we asked questions around kind of people's attitude to the channel, how they were feeling about the channel, how confident they were in it, how, whether they were looking to spend more in 20,25.

[ 00:13:49 ] And then we also asked some questions around their attitudes to some big factors that are playing out in the channel, specifically around cookies and tracking and Google. And we also asked a question about AI as well. So we kind of wanted to get a sense of how these factors were playing out in the channel. And we collated all of that together and we published the report, as you say, very recently. It's free to download from the website. Trade Doubler was sponsor of it. We went out and asked some companies if they were willing to put a bit of money behind it to help us part fund the research. And yeah, so as I said, it's available to download. We've had it. It's been downloaded about 600 times now in the first few weeks, so pretty happy with those numbers.

[ 00:14:29 ] And I'm hoping that it will sort of get wider coverage outside of our industry, which obviously is always a big challenge that we have. How do we go out and reach beyond the confines of the affiliate industry? I love this report because it gives us so many insights that we did not have before. Now when you're looking at the report, just like kind of like the headline. The industry delivered £21 billion in order value for brands in 2023, which is 14% growth. For me, that sounds impressive. There is a few others like 356 million sales, a million sales per day that was delivered. How do you interpret all these figures? That sounds for me very healthy. Well, it is and I was very happy with it.

[ 00:15:17 ] It was interesting because, as I say, we have one data point, we have one annual data point that the IAB gave us, which is they get submissions from affiliate networks when they're doing their annual ad spend survey, and they've literally given us one data point, which is the spend. So commission and fees. And if networks don't submit, then they don't try to model the numbers. So we always knew that this year, I think they had seven companies submit. So we always reason why the numbers are so different from the IAB numbers. Yeah, I think so. We we were able to record an additional

[ 00:15:50 ] half a billion in spend compared to their numbers so they're not i don't think their numbers are wrong it's just that they're looking you know they're not going out and trying to um make they're not trying to capture everything they're just capturing what is submitted to them um and i had some sort of in my head i had some points that like some data points that i wanted to hit so the 20 billion in terms of revenue spend so it's actually it's close to 21 billion and that for me hitting the 20 billion was sort of a benchmark that i really wanted and i kept saying to josh he was our researcher are we there yet and he kind of said i he said i think that we are going to be over the 20 billion figure and that for me was just sort of a really important sort of benchmark data point uh within that we we broke the data down into sectors so broad top level sectors we didn't go particularly deep with the data Because we didn't want to scare networks off, we didn't want to give them a huge sort of a huge huge task as our first piece of piece of work. So, we only asked for a handful of data points, but we did ask at top level sector so you know travel retail etc and obviously we were able to kind of then apportion a chunk of that to each of those channels, sorry, each of those sectors.

[ 00:17:00 ] And the retail data point came out that we were kind of indexing at about 10% of UK e-commerce spend. In other words, you know affiliate marketing is driving one in 10 pounds that is being spent online. And again, that for me was like a good psychological data point that We could say one in 10, it feels like a really strong, you know, it's double digit, that feels like it's a really compelling thing for us to go and talk about, and also remember, you know we asked the networks how many active affiliate programs they have on their network, and we came out with a figure of around about 12, 000 active campaigns. Now in the UK there are like 400-500, 000 e-commerce enabled websites, so that's only scratching the surface, right?

[ 00:17:44 ] We know that there's a big chunk of opportunity that's out there that isn't being captured by through advertisers running affiliate programs, so for us to be able to still say one in 10 pounds when we're only scratching the surface of certainly the same base of brands that are out there running programs, I think shows just kind of what huge opportunity there still is in the channel. Yeah, I agree. I agree when looking a little bit deeper into the report, I think there's besides some other aspects or or maybe as the first aspect it's really interesting to look on the one hand on the industry so the brand side or on the publisher side, what are the main verticals the main industries um that are working with partner marketing on the brand side and is there do you see any differences in in in how they do partner marketing?

[ 00:18:33 ] How they develop in these different verticals, so we as I say, we didn't go too deep in terms of um asking questions about um how programs are being run; however, just looking at sort of our top-level data that we captured from from the network survey, we obviously don't typically don't capture a revenue and revenue figure around things like telco and finance. Um, so it's very difficult to kind of extrapolate what that is, what that means in terms of revenue, you know. It might be that you're just capturing a nominal value against each of those i know from my time working at Awin, Awin has like a big chunk of telco brands and for those You just capture a nominal value against each of those and you

[ 00:19:15 ] just need to catch you know like a signifier to say that's a unique sale um I think what we, what was interesting is how much travelers bounce back i mean it's not a surprise that obviously travel was down in the doldrums during Covid but we, you know from 20, from 20-21 to 20-23 we saw like 160 percent growth in the travel industry so it's really encouraging to see that that has really come back um and and now represents a really decent chunk of revenue it's not really surprising i think that retail remains, you know retail is the most ubiquitous there are by far and away. The most e-commerce sites out there that are retail sites, um, Telco for me is always a really interesting one.

[ 00:19:58 ] Uh, it's because I say it's difficult to measure the value but we also know that Telco brands really, really do embrace affiliate marketing and I for me it's that sort of holy grail of elevating affiliate up through the value chain internally within businesses. And typically when you are, you know, you're in a business and you're in a business, you're talking to Telco brands, you're going in at a more senior level, you're talking to more senior stakeholders, and that typically means obviously you're you're getting In front of people that hold the purse strings and and are able to control the budgets, and therefore you know being able to work with them to hopefully get more money assigned to the affiliate channel. I think why you think that is why why you think that telco is different to other verticals.

[ 00:20:37 ] It's an interesting one because i there isn't really a particular reason that i i can i can point to. Other things, other than i think it's just the way that the publisher models have evolved in the UK so a lot of it's similar in other markets too yeah yeah a lot of the price comparison stuff or you know the the comparison sites have typically been affiliate sites and i don't think that necessarily happens so much in other industry other sectors and because and so therefore because they do capture such a big market share and they have such big consumer bases it means that if that's if if you have to run affiliate activity and all that stuff then you're going to have to run affiliate activity in order to get access to those sites then that's what you have to do and so i think it's i think it has been just simply because that the affiliate models have emerged in that sector in that way and let's say they've been affiliate first companies in a way that doesn't necessarily Happen maybe in travel, for example, when you now look at these different verticals and when you look at the market condition-so it's obviously become a little bit tougher out there. Do you see that in the report as well across these different verticals? Well, I mean we we obviously only capture data until the end of 2023, I think. When we look at 2024 and we will try and capture that data and release that data at some point in maybe around sort of Easter time in 2025.

[ 00:21:58 ] I am slightly nervous about what we're going to see in terms of 2024 growth; um, 2020, 2021, 22, 23-we saw a combination of factors right? We saw Covid where everybody Was buying online, but we also saw inflation as well, so you know if inflation is 10 then everything you know automatically the channel is going to grow assuming everything it remains equal, the channel is going to grow to 10 percent. We saw for example already at the end of last year that order value was growing at a really good pace, but the number of sales was already coming down a bit, yeah. And I don't, I don't think that that is um that's unusual, I think that we're seeing traffic working harder, I think it's converting better um, but that obviously means that you're potentially therefore recording fewer clicks um, I think that.

[ 00:22:44 ] obviously generally speaking across many markets has returned to sort of more more normal levels so we can't rely on i mean we shouldn't be relying on inflation for growth anyway but um it does mean that the channel is going to have to work harder and certainly in order to kind of keep up with the level of levels of growth that we've seen over the last few years and i think that that you know that is that's not a unique channel sorry that's not a unique challenge to any one particular company i think that's across the board when i'm speaking anecdotally to companies they're feeling back to me that it is it's tough out there At the moment, and that's not unique to affiliate; it's not unique to networks; it's not unique to any one sector; it's across the board.

[ 00:23:24 ] Yeah, when you now look at the publisher side, you spend a lot of um research and you have a lot of findings in the report about the publisher side, so the network in partner marketing if you want to say so, who's driving this business um what is the main players what's the main verticals on the publisher side? We look at spend so where brands are wanting to spend their money rather than revenue and and sales; what we've so we obviously had to we had to be quite um we had to come up with a universal standard. Right, so we had to ask networks that we know that you might refer to voucher voucher sites as coupon sites but we need to map everything to standard categorization so we asked affiliate networks to kind of fall behind our categorization we and we limited it to about eight different affiliate types again we know that there are more affiliate types than that but we when you're getting to sort of like single figures or even less than one percent of of spend we just tried we basically said well let's we'll just bucket that as other so we did um but and we also aggregated loyalty voucher and reward as well because we felt like It was a similar mechanic, and what we found is actually there was a very significant amount of diversification across that base, surprisingly. So um, our biggest spend area is loyalty reward and cash back, but that only came in around about one in four pounds was being spent through through those affiliate types which surprised me; I thought it would be higher.

[ 00:24:56 ] Um, I think that where there is where there is really some really interesting stuff happening is maybe a bit further down that chart, so if you look at maybe some other smaller affiliates by spend, like CSS influencer tech partners, they come in in at like single figures. Amounts but we know that they're going to be kind of more one-to-one relationships that need to happen as opposed to like a blogger or a cash back site that might go out and work with thousands of brands, these are companies that are kind of going out and building maybe a handful of relationships or you know a few dozen relationships so overall their spend is going to be lower as a percent of market but they can obviously be very impactful on individual programs.

[ 00:25:37 ] So I made the point in the in the report that we shouldn't read too much into the fact that they they they're quite low down the table, and actually what we what. We also saw is that if you're looking at growth, so rather than just acting absolute spend. If you're looking at where growth is coming from, CSS and influencer are seeing some really significant growth in the channel. That's two main trends I would say you see. I mean it's again they're starting from a low base um, I think the influencer conversation is really interesting. It's-I have to be honest-it's not a market that I know a huge amount about but it's a market that I know a huge amount about and it's a market that I know a huge amount about.

[ 00:26:16 ] Um, it's been interesting to kind of watch that trend emerge in the affiliate channel. I think that they've kind of bumped along against each other without necessarily knowing how to cross over, you know. It's all a lot of this is semantics right because a lot of people would say well, affiliate is influencer anyway and a lot of the activity could be classified as influencer um but I think because the payment models historically were so different it was very difficult to kind of square that circle. What I think we're now finding is it's like in in a lot of marketing channels as brands demand more performance-based activity it just becomes a more natural fit for the affiliate channel and so I do think we're Seeing that convergence an element of convergence, I don't think this.

[ 00:26:58 ] I think that maybe influencers don't necessarily like that but they are going to have to sort of play according to the brand's rules, I think, and brands are being more demanding around the as I say, the, the, outcomes and so as and then there, so therefore it's an easier conversation to have from an affiliate point of view when now when you think about our industry, I think the main purpose is obviously to connect brands, advertiser brands with partners with publishers um on both ways um publishers want to work on many programs they use affiliate marketing. in order to scale their businesses being able to access thousands of brands instantly through the networks on the other hand obviously it's important for the brands to connect with the publishers and i find it a very interesting part of your report where you state that you're not only a brand but you're also a brand and you're not only a brand and you're also a brand but you're also a brand and you're also a brand what is important for publishers when working for a brand i think that would be super interesting if you could share around that especially for brands that are listening now what is important for partners What do they need to bring to the table? I think, so, so we asked some questions around um, you know, how the industry could be improved and we asked both brands and we asked publishers and we wanted to ask similar questions so that we could compare and see whether there were kind of any big contrasting bits of feedback. I think the inevitably affiliates want to be paid fairly for sales right, they want them to feel as though the commissions that they're earning are reflective of the activity that they're so mainly about tracking um, tracking came through as a as a, we asked about you know whether tracking.

[ 00:28:36 ] Was was a concern for people, actually. What we found is there was a high level of awareness amongst brands. We when we asked brands, we actually kind of asked a slightly leading question and we asked a slightly leading question and we asked a slightly leading question because we kind of assumed the the question that we asked was about how they can improve their tracking so we made the assumption that their tracking wasn't working as effectively as it should be. We did give them the option of saying, actually our tracking is fine, but um, but a significant chunk of of brands actually fed back to us that um, they know that they need To make tracking improvements, but there are reasons why they haven't done that.

[ 00:29:12 ] I think tracking is a really tricky one; we are going to have to figure out how to do that and I think that's a really tricky one; we are going to have to figure out how to do that and I think that's over how to phrase the questions around tracking, and we got a lot of feedback from it. Because it's very difficult to ask a question around tracking when all networks kind of talk about tracking differently, even though there is obviously a level of sort of consistency around how tracking operates, but I think that because there are multiple Systems that are taking place or tracking systems that are taking place at any one time, it's very difficultness.

[ 00:29:41 ] This potentially can be quite difficult for brands to actually understand what tracking is and how to do that so I think that's a really tricky one we are going to have to think about what tracking is and how to do that so I think that's a really tricky one. We are going to have in place on their affiliate program, um so I think that that is something that that came through quite strongly that we when brands answer about how they feel their tracking operates we don't necessarily think that is actually reflective Of what is happening, we asked a similar question last year and there's a high response rate around brands believing that they have third-party tracking in place now they might do as a sort of a failover um system but the I we'd wanted to understand the dominant ways that they were tracking.

[ 00:30:19 ] And we feel that it's over-indexing on third-party in a way that isn't necessarily happening on the ground. So that, for me, was sort of a big indicator about there's a lot of work that we need to do there. And there are ongoing projects that we're working around tracking, and it's an ongoing thing. It won't be just one piece of work that we do on tracking. We will continue to build tracking information and tracking standardisation as best we can as an industry, as a trade body. And the commission side of it, I thought, was interesting in that if you ask affiliates whether they think they're paid fairly for sales, they typically say no. If you ask brands whether they think they pay a fair commission, they say yes.

[ 00:31:00 ] And I suppose you could say, you know, if you were to guess, then that would probably be what you would say. One point that we made in the report, which I don't know whether it's true, it's just sort of my perception of why that might be, is that, if brands are paying for sales, they see the sale come through, they pay a commission for it that's been agreed, and they think that's fine. Where I think that maybe they have less of a focus is on all of the activity that it requires in order to generate that sale in the first place. So obviously there's a tonne of activity that takes place that doesn't convert, and that is kind of the free element of the channel.

[ 00:31:41 ] But we also asked a question of publishers about the variety of channels that they use in order to, you know, drive sales. And on average our publishers were responding that they use 4. 3 different routes to market. And that includes things like Facebook and Instagram and email and apps and all of the different, you know, blogs. It could be TV advertising in some instances as well. So all of the different routes to market. And I think that they are looking at everything in the round and then it just, and then they get paid a small amount for the sale at the end. Whereas brands are potentially only focusing in on the outcome rather than the activity that sits behind it.

[ 00:32:15 ] I think it's a very important topic to get across, right, that everybody understands the innovation and the dedication that publishers are driving in order to drive business then again for brands, right? So this is, I think that's fantastic. I would love to see it's kind of, at the moment it's a little bit of a kernel of an idea in my head because I'm thinking now to 2025 and what we what we build into the roadmap for next year. But I think there's a really important piece of work that we need to do as an industry around bringing all of that activity to life and putting a value against it that isn't necessarily just the sale at the end. I think that everyone has a part to play in that.

[ 00:32:55 ] I think publishers have a really big part to play in that. And for me, it then bleeds into another topic, which I think is we've seen come, you know, really front and center this year, which is how Google has kind of picked a fight with the channel this year. And we have to get better at diversifying traffic and revenue away from Google. And if publishers have these really amazing assets, and if they have these big email databases, then we need to be working with them to help that deliver value and rather than them being reliant on Google for traffic and activity. Because I think we've all known it for years that there is too much reliance on Google, but whilst Google weren't necessarily, whilst Google weren't doing anything about it, we kind of ignored the issue.

[ 00:33:48 ] And this year it's come front and center and we've seen it play out in a variety of different ways. And so we have to get better. You're speaking about Google Analytics 4, for example, right? Well, it's kind of attacks on multiple levels, really. I mean, GA, from a brand perspective, GA4, I think has created a lot of confusion amongst brands. Again, we asked a question around how confident brands were in affiliate activity off the back of GA4. And what we found is, there is a high level of concern amongst brands about how accurate affiliate tracking is. Now, affiliate tracking hasn't changed. It's just that GA4 is now interpreting that data in a different way. And obviously GA4 is not a tracking platform. It is an attribution platform. Exactly.

[ 00:34:32 ] So we're not necessarily measuring the same things here. So again, there is work that we need to do in order to build confidence in brands and to help explain how affiliate tracking is still robust and it still works. So there's that side of it. But then there's also obviously the everything that's happening in the SERPs with Google coming along and obviously applying either manual penalties or algorithmic changes to some affiliate activity. Some of it, I think, you know, you can have an honest debate about how valuable some of that activity was that has been removed. But again, having spoken to a variety of different companies, it seems as though there isn't necessarily any kind of logic between around who's at some sites that are being hit.

[ 00:35:14 ] We've seen, you know, some good quality content price comparison sites that have been hit and they don't understand why, because they followed all of the rules. And now that they've they've been hit, they can't get any answers about how they can how they can get back other than following the best practice, which they've always done anyway. So. And, you know, it's it's it's a really it's a really tricky one. We've also seen within, you know, the big publishing houses, there doesn't seem to be any logic. If you take a company like Future and you look at their traffic, if someone like that's coming through their different publications, I think they have good housekeeping and have tech radar, good housekeeping. We looked at the data, good housekeeping.

[ 00:35:55 ] Their traffic has dropped by 50 percent, but tech radar, their traffic's grown by 50 percent. So, you know, we're seeing completely divergent things that happening. Within the same business, which inevitably it's all going to be powered by the same tech. So why why is Google applying a manual hit in one instance or an algorithmic hit in one instance on one of their sites? But they're then they're then sort of pushing another one up. It could be a kind of they're driving a lot more traffic around Reddit and that aligns a lot more with a tech radar audience. But, you know, these things we don't necessarily know. And so we're kind of working this out as we go along. But coming back to that.

[ 00:36:34 ] To my earlier point, I do think that diversification around away from Google has to be something that we tackle head on and that we try to show one of the topics we need to we need to focus on. The other one is obviously tracking, as we already said. What is other topics you think will keep us busy in the coming months? So I think cookies, you know, kind of an evolution of the tracking conversation. We are about to embark. On a project, hopefully with all of the networks, we're going to have a sit-down with the networks and have a conversation around what sort of level of industry standardization or a commitment that we can agree to around encouraging brands to or educating brands around cookie classification and specifically how affiliate marketing is classified within cookies.

[ 00:37:26 ] I think if you're looking at any one factor that can have the biggest impact on an affiliate program, negative impact, then it has to be cookie classification, you know, and again, anecdotally, I know of a big retailer in the UK who I won't mention who they were and I won't mention what platform they're on, but I know that they made a change to how they classified affiliate cookies within their consent management, right within their consent management platform. Yeah, and it wasn't just that they made a change to it. It's how the consent management platform was implemented as well. So it was like a very overzealous implementation and that program saw a 70% drop in sales tract.

[ 00:38:09 ] Now, fortunately, they reversed the decision very quickly because for obvious reasons, they, you know, they were working with very valuable partners who all of a sudden they had gone from being running profitable activity to unprofitable activity. So they reversed the decision. However, that remains a risk that's out there. You know, whilst we're having this conversation, a brand could make a change to how they classify. They. And overnight we could see 30, 40% drop in their sales. So that for me is, is, is the big topic that we need to be. We need to tread quite carefully with it because, you know, it's ultimately, it comes down to a legal interpretation of what the law says and, and how you feel your cookies should be classified.

[ 00:38:50 ] But I also think we can make a pretty strong case for how we feel that the affiliate channel is a pretty data-light. Um, you know, if you're looking at a privacy invasion around marketing activity. On a scale, you, you would definitely put affiliate at the kind of less invasive and end of the scale. And I think there is work to do around educating regulators on it. We've recently seen an exemption for cashback and loss in reward within the UK following off the back of a decision that was made in France by, by their data regulator in 2021. Um, whether there is pressure within the industry in other markets to sort of follow suit, uh, will be interesting to see, but one encouraging thing.

[ 00:39:32 ] I would say is that the Information Commissioner's Office, who is the data regulator that decides all of this stuff or interprets the law, um, and, and pushes out guidance, is I do think that they recognize that there is nuance and that marketing isn't just marketing, you know, a universal standard thing within that there are lots of different shades of gray. And so I think that we can, if we can get in front of them and we can kind of keep building on that conversation. Then I'm hopeful that at some point. There will be. There will be additional clarity for affiliate marketers on cookie classification. So you have Google, you have tracking, um, consent management as key trends. Um, there is opportunities as well, right?

[ 00:40:13 ] So for example, I know, I guess I know you're quite passionate about, um, rolling partner marketing out to SMEs. Um, there is clearly something to do, um, for the industry, I guess, right? Yeah, I think that, um, it, it's a bit of a, I think it's maybe something that's a bit symbiotic. That's happened over the. The last few years and, and you, you'll know this because you've, you've kind of been really able to sort of grow your SME base as well. Um, I think that if, if I, if I look back sort of 10, 12 years ago, I don't think that we were terribly good at supporting SMEs. And I also don't think the opportunities were necessarily there.

[ 00:40:49 ] You would see SMEs launch programs and then really sort of struggle to get kind of, um, their voice heard and struggle to get any kind of meaningful publisher on board. One of the things that we tracked. In the report was the growth of public, the active publishers in the UK, and that's grown significantly over the last few years. So there's a much bigger base that they can select from, and SME offerings that networks have created, I think are just a lot more attractive and a lot more low risk for them. You know, the price points tend to be quite low. It tends to be, you know, low commitment on their side. They, you know, they're not having to sign big, long contracts and they're not having to kind of front up lots of money to just to get the program off the ground.

[ 00:41:30 ] It's very low risk. Low barrier to entry and also easy for them to exit. Should they decide, you know, three months down the road, if it's not working for you, then fine, you can kind of walk away. And I think that because the industry's kind of created solutions that have put those things in place, it becomes very easy for SMEs to join. And actually, I can kind of look, look back at my, my time at AWIM because this was a big focus for them as well. One thing that we found is that actually you can build [it] as long as you build great support around it. You know, you can't offer account management because the programs aren't, don't make enough money.

[ 00:42:05 ] It doesn't make financial sense, but you can build fantastic support around for them in terms of content, education, you know, email content you can build out through automations. And I actually, I'm, I'm convinced that you can, you can build, if you invest in the infrastructure around that, you can build out a fantastic product for people that in some instances they get more helpful advice and, and more, targeted content through that marketing automation kind of piece than they would necessarily get from maybe having a pretty average account manager that's doing a couple of hours a week for them. So I think that there's a huge opportunity there. There's a ton of, there's a ton of, of, of, of programs out there that, or a ton of advertisers out there that could launch affiliate programs and hopefully will over the coming years.

[ 00:42:53 ] In the beginning. Yeah, exactly. Yeah. And in the conclusion of your report, you sound very. Positive, almost enthusiastic about partner marketing. Can you share you a few bits? Well, I mean the, the numbers kind of back it up. So we wanted to, we were always hopeful that numbers were going to be good, but you obviously don't know if the numbers had come back and they were bad. I'm not sure how we would have structured the report and what we would have said about it. I think that obviously we did want to go out with those big headline numbers and we did want to, we, when we had our launch event a little while ago. We did a very short kind of explainer around what was in the report.

[ 00:43:35 ] And then we had a panel of, of, of some industry people on, on the panel, just sort of discussing some of the deeper findings. And I was very clear that I wanted that event to kind of be a celebration of the industry. So, you know, people, people arriving greeted with a glass of Prosecco, come in, hear the big numbers. And it was very much, you know, I, me standing on stage saying, 'This is a celebration of all of our success and we should be proud and successful about how we've built this industry.' And for me. The, the ongoing thing is just trying to get that message out beyond the confines of the affiliate channel. And I think the big numbers help to do that.

[ 00:44:09 ] So I am optimistic, but also obviously we wanted to be realistic as well. So, which is why we then tackled some of those, those more tricky subjects. I do think that this it's the, the affiliate channel is kind of like a bit of a renaissance channel. I think in that it's, it can all, it will always reinvent itself. And if you're faced with an issue here that feels insurmountable.' There will always be, if you can't get over that issue, there will always be something over here that you can focus in on instead. And, you know, I, I kind of look at my time and affiliate, and you see it go through waves. You see kind of waves of innovation.

[ 00:44:43 ] I think it's fair to say four or five years ago, we were kind of scratching our heads, working out where the next innovation was coming from. And then all of a sudden, I think COVID happens kind of exactly through the network. And all of a sudden you had all of these new, this flood of affiliate applications. And so I think. Again, it's about how we position the channel. I'm a big fan of positioning our channel as being like a, an incubator of innovation. You know, we're an innovation hub. It's a very easy for startups to, to come into the channel, get access to brands really, really quickly. And as long as they can monetize on a CPA, it's very low risk for brands. And it's very easy for them to kind of build out their, their, their offerings.

[ 00:45:23 ] And so, you know, we don't know necessarily what's coming down the road in 2025, but I can guarantee you that there will be new publishing models. And new publishers emerge that we hadn't thought about, or that we didn't realize could become an affiliate model. And that for me is like a really exciting thing that, that I think is, is, is unique to our channel. Great. Thank you, Kevin. When you look now for 2025, what's your plan for the APMA and for another report? Are you going to publish another report in '25 or '24? So we have a planning session soon. So that's all TBC. We will, we would, there will be budget for, for research next year. I think that we, my hunch at the moment is that we won't do a report like this.

[ 00:46:09 ] We would definitely do the financials. We would definitely do shorter surveys because I think that was a bit of a struggle trying to get responses because the surveys were quite long. And I think, what, what we will want to do is try and complement other research that exists. So there were a couple of research pieces that existed out there that we, we decided not to ask those questions because the data already exists. But what we want to do is make sure that the data that we capture helps drive projects that we can deliver on and bring about positive change. So some of the questions that we wanted to ask around cookies and tracking very much feed into the project, some of the projects that we're working on.

[ 00:46:46 ] So I don't know what the research will look like for next year. We may choose to do it in chunks across the course of the year. Maybe a chance that you will do that across more countries, across Europe, for example. It's interesting because I've had them. I've had a couple of conversations about this. There's no reason why, you know, the majority of companies that submitted their data are global companies, right? Exactly across multiple markets. And I know for a fact that if I had been, if I was still working at a network, I had access to the data. It would be just as easy for me to pull in multiple markets as it was for me to just to isolate the UK data that becomes a much bigger project.

[ 00:47:22 ] It requires a lot more input from potentially from getting sign-off from local stakeholders in other markets. We could potentially focus in on a handful of markets. You know, the bigger markets, France, Germany, maybe Italy, Spain, US and maybe Australia and a handful of other countries. We could focus in on. So I'm kind of I would add another level of dimension, obviously right? That would be very interesting comparing it as well to market conditions and stuff like that. Yeah, I mean it then takes on a kind of a whole additional chunk of work. I would love the report and the research next year to kind of put together a proper sponsorship package to try and get to we would need additional funding for it.

[ 00:48:10 ] I think that hopefully Josh, who was our research consultant, he seems pretty keen to continue working with us. So if we could, but it's something that we're discussing literally at a planning meeting very, very soon. So alongside all of the other work that all the other projects that we want to drive. Next year as well. So we would definitely do something but I suppose watch this space really. Yeah, I'm curious really curious coming to the end. Now. I have a few questions just like for the closing. You have a long career in partner and in performance marketing. What would you say is the key learning you had in this career that you want listeners to remember now? More like a personal question now today.

[ 00:48:56 ] Yeah, I mean I've worked in affiliate now for over 20 years and obviously it's changed significantly over that time. You know companies were very, very small and brands weren't really interested in affiliate marketing and, to be fair, we were kind of making it up as we went along. I think that obviously it's become a far more professional; it's a much larger either people see it as a proper career now in a way that at the time people just fell into it as a job. So, you know, it's become it's become firmly established. I guess I guess for me, it's that the thing that I really love. Is getting inside the data, you know, I'm I've got a history degree and that, you know, being interested in history.

[ 00:49:36 ] You're always interested in trying to get to the heart of the matter and the truth of what actually happened. Why someone did that thing, you know, a long time ago and for me, it's the same thing with with affiliates, you know, trying to don't accept the data at on face value. Really delve into the data and try and understand actually what's really really happening one thing that I remember. This is going back a long time now, probably about nearly 20 years. I remember being really interested in a program that I was managing; as the account manager for at the time, and I kind of thought to myself, 'The brand is working with us for our expertise, right?

[ 00:50:16 ] They're hiring our services because they can't do it or they need they need assistance from us.' And I kind of said to myself, 'I need to kind of understand their business better than they do and I think that that's really, really important. I think I've gone to a number of sales pitches over the years if you can go in and really resonate with the brand when you're going in and saying, 'I know, I've read your annual report. I know what's important to you. I know how well you're doing financially. I know what your focus is for 2020 and into next year and then go in with a plan that aligns with that, then that I think really helps solidify and it really helps embed the affiliate program intrinsically within there.

[ 00:50:57 ] Business and I think as an industry, we don't do that enough. I think that we just sort of take standardized templated stuff along to Brands and say, 'This is who we are and this is what we do' as opposed to this. We know your business, and this is how we help can help your business to succeed. So, I think it's you know, just sort of stepping into someone else's skin and just understanding what their motivations are and how what their motivations of the company are, and then aligning that with the channel just being a lot better at how we bring that to life. And then I suppose the one other thing I'd say as well. Is I think one thing that we need to get better as an industry is telling stories about our successes and about affiliate successes.

[ 00:51:37 ] I think that we because we're such an outcome-focused channel where everything can be measured on a spreadsheet, just because you can kind of provide a spreadsheet someone that doesn't bring it to life. You know, you're not this not hearts and minds thing, and I think that we need to get better at doing the hearts and mind stuff. I think that we need to get better at telling stories. People: people don't remember a spreadsheet, but they remember stories and they remember like really interesting case studies and really interesting success stuff. And there's stuff that I've worked on in the past or that I've read in the past that really resonates with me just because it's a really interesting angle on how they took the affiliate channel and how they were able to work with a publisher to drive sales.

[ 00:52:19 ] And so I'd love to see it's something that is time-consuming to do in case studies are difficult to get off people. But I'd love to see the industry kind of really coalesce around some really compelling stories that really, really get cut through. That's really good advice for us working in this industry. What would be your recommendation for marketers working with partner marketing when doing so? What would be the one thing I suppose it's kind of having having an open mind. Yeah, it's you know, the the risk is very low. If you're if you're looking at purely from financial investment, the risk is very very low compared to other channels. Yeah. I guess it's you know, just making sure that you're investing enough time.

[ 00:53:01 ] This channel cam is still quite manual and in an age of kind of automation AI machine learning at the rest of it. We are still quite a manual channel and you kind of have just have to accept that whilst there will be automations and there will be kind of things to that make the industry more efficient, that you do have to just take time to understand the opportunity and get inside the data. I think also sharing data as well. We're not very good. Because we have different constituent parts, right? It's not two companies talking to each other. It's typically there's might be this three maybe even four players involved in that relationship and very often those companies can kind of quite jealously guard their their data.

[ 00:53:39 ] And I do think we need to get better at turning our data from what is what can be quite two-dimensional into kind of three-dimensional data understanding what's happening across, across the whole journey, but beyond the journey as well. You know, if you're driving customers, how valuable those customers and what can we read into the types of customers? That can be driven by different types of activity and the levers that you can use, you know, if you increase your Commission by 50%, what does that mean in terms of the quality of customers that you're getting versus the number of sales that you're recording? So it's a lot more sort of focusing on how can we build that qualitative piece rather than just focusing in on the numbers on the spreadsheet? Thank you so much Kevin. Thank you for sharing all these insights with us. I think that was super interesting talk. Thank you. Thank you. Wow. This was the first episode of our interview. Our new partner marketing podcast. What an experience. I hope you enjoyed it. I'm very much looking forward to the next episode. We hear us in two weeks. This podcast is produced by TLDR Studios.