PartnerCentric’s Stephanie Harris on how affiliate marketing is evolving in financial services

Today we dig into affiliate marketing. It's a model that was first made popular by Amazon. A company looking to increase its sales partners with content sites to promote products. If those content sites are successful driving traffic or sales or leads, they get paid. Nowadays, every major credit card player has an affiliate program.

Stephanie Harris is the founder and owner of PartnerCentric, a performance marketing agency. She and her firm work with major card issuers and banks to help them maximize the results from their performance marketing. We talk about why affiliate programs make sense in financial services and Stephanie describes the challenges in running a good affiliate program. Lastly, she gives us some tricks of the trade for financial firms looking to get into affiliate market.

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The following excerpts were edited for clarity.

What is affiliate marketing?

We work with major card issuers and banks to connect them with meaningful partners that can drive top value for them on a performance basis. These partners are called affiliates and in affiliate programs, marketers pay out to affiliates only when the traffic they send back to the financial institution completes a valuable action. This ecosystem is the landscape in which we operate.

Affiliate programs in the financial field

Affiliate programs are effective ways of leveraging the influence of influencers. They help to spread the word to consumers who may not have heard of a product or company previously. Amazon was a pioneer in the industry and many of the original players were in the coupon and loyalty space. It's definitely evolved over time to become more performance driven.

A financial services company may be able to partner with top financial content sites, influencers, editorial teams, new technology partners. That really helps them to increase their share of voice and grow their business.

Why card issuers and banks use affiliate programs

Nowadays. every major card issuer has an affiliate program. You'll also see disruptive card issuers launch affiliates, too. National and regional financial institutions also use affiliate programs. Because the affiliate space enables tracking in order to pay out partners, there's a level of transparency in the channel that's really appealing to financial services companies.

Pay for actions

What issuers and banks pay for a completed action like new account or card applications vary wildly. It also depends on the credit score of the people they're going after. The higher the credit card score of the applicant, the higher the bounty. Some of these programs are private and have dozens of partners, while some public affiliate programs have hundreds and even thousands of partners.

There's a lot of negotiation on rates in financial services compared to affiliate programs in other industries.You can see a lot of what's happening with your competition in real time. Sometimes you can see that one of your biggest affiliates starts heavily promoting a competitor's offer on its homepage and what the offers look like. That tells other card issuers that there's some special deal going on between the issuer and partner. You can then determine what to do by benchmarking against your competition. Maybe you choose to follow them or do something you haven't seen your competitors do.

The evolving affiliate space

What you're seeing in the financial space mirrors what's happening in the rest of the market. Things are definitely more focused on performance. In the beginning of the industry, Amazon pioneered the affiliate model. Coupon and loyalty were the kings of the space, even when they worked with financial services companies.

Now, you no longer look at potential partners whether they can be affiliates or not. Now, we look to see if they're willing to work on a performance or hybrid cost-per-acquisition basis. If they are, that is the ecosystem that companies in the affiliate space can work with.

New editorial options

If you're in financial services, your landscape doesn't have just the traditional finance review sites, listing loyalty and coupon offers alongside OldNavy. Now, you can partner with mobile, bloggers, and new review sites that offer editorial content partners that have mastered SEO. There are fintech apps that are very popular with millennials and younger demographic. Social media influencers focused on helping young people invest their money work on a performance-based payout model.

Credit Karma, Credit Sesame, Credit.com are very influential now. The Points Guy has been around for a long time and he's very big in the financial services space as an affiliate. You can make tremendous money if you provide valuable content that happens to be incentivized with incentive bounties, but you're really doing your due diligence reviewing financial products, providing editorial content around the best ways to use them. These have become go-to resources more so than the credit issuers themselves. They show up very high in SEO and have overtaken the card issuer messages themselves.

Challenges with affiliate programs

The largest challenge is around compliance. In such a regulated industry, it's important to regularly communicate to your partners exactly what they're allowed to promote and what the rates are. You have to regularly monitor that they're updating your promotional language as you need them to.