Lasserk have been working with affiliate marketing since the company was founded in 2017. The main focus is to establish long-term partnerships with market-leading companies in selected industries and markets. This is rooted in a conviction that premium brands acknowledge the importance of long-term thinking, tradition, and innovation, in order to produce strong, competitive, timeless products that are well-positioned for the future.
By combining marketing in external channels along with our own inventory, e.g. websites and social media, Lasserk offer a dynamic solution to reach a desired audience.
About Affiliate Marketing
Affiliate marketing is a performance-based business model where one party (the affiliate) promotes another company’s goods and/or services and only gets compensation for measurable results. For example: the number of units of sold, the value of an order, or number of downloads generated by the affiliate. The sales, or lead generation, can either be driven from the affiliate’s own inventory (e.g. website) or can acquired through bought ad space in various media channels. The business model has rapidly increased in popularity as it provide both parties a cost efficient way to grown their businesses by using each other’s qualities.
Why affiliate marketing is a great business model
The strength lies in the mutual benefit both parties gain from solely focusing on the core business and yet having another party working towards a common goal, without having to set time aside to synchronise the efforts. More and more companies offer affiliate programs where potential partners easily can apply to become a partner.
By outsourcing a portion of the company’s marketing via an affiliate program, the producing company can keep a slim workforce specialised in product development/manufacturing, customer support, logistics, etc. It will also limit the time required to produce a marketing budget as the affiliate is self-sustaining and, in many cases, work on revenue share.
Strong incentives provide good conditions
Those affiliates who choose to use their own digital properties for their marketing efforts can easily pick and choose the partners/products best suited for their inventory and target audience, and develop specific content for that purpose. The digital marketing experts that are specialised in external media buying can use their insight to handpick sources well-suited for a certain product and therefore acquire users at a broad scale at a lower cost compared to most other vendors. Such a setup is very beneficial for a producing company as they eliminate the risk of making unsuccessful investments in media buying.
Another advantage for the producing companies that are outsourcing the marking to affiliates are that they can be sure that the affiliates have strong incentives to deliver great results as the affiliate only work on commission, and invest their own time and money in the project. An employee or an agency working on a fixed fee would not have the same direct incentive to go the extra mile.
There are different commission models within affiliate marketing, with the common factor that all require a specific action from the affiliate to trigger the commission. Below are a few common models listed.
Revenue share – the product owner and the affiliate split the revenue that is generated from the affiliates customers.
The payouts for the models above (revenue share excluded) are usually calculated based on the companies forecasted customer value. The companies can not set the payouts too low without running the risk of losing competitiveness of the affiliate program. However, they will have a good idea of how high they can go to make a sufficient margin.