Since affiliate marketing is a performance-based concept, its effectiveness depends largely on marketers’ ability to evaluate their affiliate campaigns’ performance. The smooth allocation of transactions is crucial to a successful affiliate program and, if an affiliate succeeds in generating leads, they must be reimbursed in a timely and efficient manner.
Table of contents
- Affiliate tracking in a nutshell
- How can you know which links result in conversions?
- 1 – Customer-based tracking
- 2 – Server-to-server tracking
- Which tracking method is better?
- Cookie-based affiliate tracking
- Postback URL affiliate tracking
- Pixel Tracking
- Affiliate Fingerprint Tracking
- Impressions / views tracking
- IP Affiliate Tracking
- How are Affiliate transactions allocated to affiliates?
- Why do you need affiliate tracking software?
- Common affiliate tracking problems
- Fraud in the affiliate marketing business
- Cookie Session Duration
- Clicks from 2 different affiliates – who gets the commission?
- How to make sure your affiliate commissions are always tracked?
So, how do we make sure all the transactions are tracked precisely? There are a few methods we are going to discuss today!
Affiliate tracking in a nutshell
Generally speaking, affiliate tracking software is used to monitor the referrals, leads, or orders made by one individual or a company from another person or company.
Tracking is required to manage and reward participants in the affiliate networks efficiently.
- Participants who consent to be endorsed or promoted are referred to as “affiliates.”
- Those who sell and recommend are called “marketers.”
- Those who have the goods or services that are sold are called “advertisers.”
Affiliate networks are mid-cap firms that handle both marketers and advertisers, acting as brokers.
Read more about starting an affiliate network yourself:
Part 1: Where to Find Affiliates?
Part 2: Where to Find Good Offers
Part 3: Affiliate Network Technical Basics
Part 4: How To Pay Affiliates?
Part 5: Where to Promote Your Affiliate Marketing Program?
Part 6: Where to Get Quality Traffic?
Part 7: Performance Marketing Software – What You Need To Know
Part 8: Why you need a White Label Affiliate Marketing Software
The affiliate tracking software, which is the foundation of every affiliate business, can be hosted on their own server or run in a SaaS cloud. Its purpose is to capture page views and clicks of promotional content (banners, ads, etc.) while also tracking conversions, i.e., events that the advertiser is willing to pay for. Examples may include:
- CPC (Cost per click)
- CPA (Cost per acquisition)
- CMP (Cost per impression)
- CPS (Cost per sale)
- CPI (Cost per install)
- CPL (Cost Per lead)
- CPV (Cost Per visitor)
- CPO (Cost Per order)
The tracking applies to user-client IP identification, browser detection, marketer affiliate referral, and an advertiser’s completed transaction.
The key feature of affiliate marketing software is data consolidation that enables marketers and advertisers to perform different marketing optimization routines.
How can you know which links result in conversions?
In order to know just how useful affiliate links are, it’s necessary to monitor affiliate conversions.
Essentially, you need to know which links lead to new customers, transactions, subscriptions, or whatever user behavior you define as a ‘conversion.’
It all begins with a click – which precedes any other action the user has taken. By clicking on the affiliate link, users can open a specific product or service’s landing page. Each affiliate link must have a collection of different parameters in its URL, to address a few issues:
- Is the conversion valid?
- Where did the user come from, and which affiliate link did he click?
- Did they make a purchase (i.e. conversion took place)?
Tracking various user behavior required different tracking methods, which we will cover in this article. However, they can be roughly broken down to:
1 – Customer-based tracking
If the conversion takes place, a conversion pixel will appear, which will then read the cookies information (transaction ID) and send it back to the system used to track the conversions.
2 – Server-to-server tracking
Generally speaking, server-to-server tracking works by creating and storing a unique identifier of some kind when a user clicks a tracking link (or generates an ad impression). When a conversion (or other trackable action) is made later by the same user, the unique ID is returned to the advertiser. This is achieved by returning the same unique identifier to the tracking server.
Which tracking method is better?
In most instances, the transaction ID is linked to a fixed parameter, such as an email address or username, resulting in a higher degree of accuracy. Another advantage of server-side tracking is the ability to incorporate extra third-party tracking so that the affiliate can use the transaction ID to check the campaign results independently.
Accuracy is the key benefit of server-to-server monitoring. By creating a unique ID at the time of clicking or ad viewing, you get a higher degree of accuracy in tracking a particular transaction back to a specific affiliate.
Now, let’s break down all the most popular affiliate tracking methods:
Cookie-based affiliate tracking
This is one of the most popular methods of affiliate tracking. As Internet users, we are aware of cookies because we receive new prompts about them every time we visit a new website.
Cookies are intended to remember users, in particular those who visit a website more than once.
There are 1-st party cookies (which pose no concern to user’s privacy, as they are used only to remember logins, items added to the shopping cart, etc.) And, there are also 3-rd party cookies, which are used – as the name suggests – by 3rd parties.
Read more about cookies:
- Alternatives to 3rd-Party Cookies in the EU & Worldwide
- The Future of Affiliate Marketing After Cookies & Tracking IDs Restriction
Traditionally affiliate marketing is driven by cookies, which is a technology that communicates with a web browser to store information, including:
- user preferences,
- login details or registration information,
- shopping cart content.
If you’ve ever accepted cookies to read content on a website or opted-in to remember your password and username on the website, you’ve had a first-hand experience with cookies.
Have you ever searched online for “cat food” and then saw banners displaying special cat food offers on other websites?
This is the result of a cookie being dropped on your browser during the initial search, saving the search data as something that may be of interest to you and enabling you to be targeted at a later date. These cookies are typically set to last 30 days, but they can differ in brands.
In the case of affiliate marketing, cookies store a link or an ad that the website user has clicked on. Cookies can also store a variety of data attached to this click, including the time and date of the click and the type of website you visited.
There are many different types of cookies; however, the most common type of cookie used in affiliate marketing is considered a first-party cookie. When a visitor reads content from the publisher’s website and clicks through to buy (either by clicking through an advertiser’s banner, an ad display, or a text link), a cookie is dropped in the browser. This cookie helps us recognize the advertiser, the publisher, and, thus, the commission’s amount. This data is stored in the link information of the cookie, known as “custom parameters.”
Cookie tracking cons:
The major drawback of cookie tracking is that any user can easily erase them from their browser.
In addition, cookies cannot be tracked across multiple devices belonging to a single person.
Postback URL affiliate tracking
We have already covered Postback URL tracking in our ultimate guide to Postback tracking, but we will briefly dive into it here.
Postback URL tracking is a privacy-friendly tracking method. Moreover, this approach is one of the most reliable methods of tracking and monitoring performance. It operates on a server-based method, which ensures that no conversion is omitted. All the bits of information are kept on the advertiser’s server.
Is postback URL tracking more accurate than using cookies?
How is postback URL tracking running?
An affiliate network attaches tags to the URL of the advertiser called an ID.
Adding an ID to the merchant’s URL will be changed automatically as soon as the user hits the landing page. It’s a more complex process, but it guarantees better performance.
As I have already mentioned, there is an option to delete cookies from the browser or to surf in “Incognito Mode.” If the visitor does this, you’re not going to get your affiliate commission because no background or cookies are kept in Incognito mode.
This parameter will be maintained for as long as you remain on the pages of the online store. It can happen that the tracking parameter will vanish from the URL since there are two ways to move the value from a page to a page.
- Using the GET method: the parameter remains a part of the URL and is separated with the question mark and the path info.
- Using the POST method: the parameter is moved to the setting of the next page. This method is only available in HTML source code (such as form submission) or with appropriate tools.
Pixel tracking is an easy and accurate way to track conversions.
It’s simple to use, just take the ready-made pixel tracking code, and add it to the “Thank you” or any other page that confirms conversion.
There are four types of tracking pixels:
- The iFrame pixel is mounted in the form of an integrated frame on the website’s landing page.
- The image pixel is placed on the landing page as a 1×1 image – hence the name “pixel.”
- The JS pixel is applied to the site code as a script.
- S2S postback is the best and most accurate way of counting conversions.
All types of pixel functionality are similar in terms of application but use different backend methods. Pixels are used for statistics and conversion counting, but also, along with conversions, you can monitor and send parameters.
Affiliate Fingerprint Tracking
Fingerprint monitoring is a relatively recent innovation in affiliate marketing. A digital signature is produced from the end device in this tracking process. This signature includes basic details about the end device, such as the operating system, the language, and the type/version of the browser.
By using this information, a unique signature is assigned to each end unit, which is later used to identify the user.
Fingerprint monitoring enables the user to be identified in various time sessions as long as they use the same computer and the same browser. As for other tracking methods – the tracking of cross-devices with fingerprint tracking is not possible.
Impressions / views tracking
Visits to the same destination can be monitored as purchases after seeing the commercial advertising beforehand. The affiliate would then obtain a commission. This gives a lot of benefit to post-view monitoring, particularly to affiliates, while marketers criticize this process’s simple exploitation.
IP Affiliate Tracking
This method is used in two instances:
- When cookies cannot be identified, or
- When a user has no Flash Player installed
It’s a rare situation, but it does happen.
When monitoring the sales process, the platform searches for the last clicks from a known IP address. If the affiliate marketing network locates such a click, the particular affiliate ID will be added to the affiliate so that they can receive their fee.
How does affiliate tracking work?
When you choose an affiliate marketing software, such as Scaleo, that will power your business; you will either get to choose the tracking method or use the most appropriate type of business and is the most accurate one.
How are Affiliate transactions allocated to affiliates?
When an affiliate signs up to join the network, a specific affiliate ID is assigned to him by the network (For example, if you sign up as a Scaleo referral, you will have a publisher ID, referred to as a PID, expressed in a number such as 1234).
This ID is then inserted in the affiliates’ URLs to advertise the brand’s goods and services. Within this link, publishers may use click references to distinguish between websites or promotional slots.
This link can look like this: https://scaleo.io/?ref=1234.
When a visitor clicks on this link, they are led to the retailer’s website, and since the affiliate’s ID is embedded in the referral link, as well as the brand’s merchant ID, it allows unique assignment to the affiliate and merchant involved in the transaction, enabling the commission to be paid out precisely.
This monitoring feature helps advertisers recognize the affiliates that are driving the majority of the traffic to a particular campaign or offer. The brand may decide to have different commission amounts per transaction for each of these types of affiliates, and so the uniqueness of each affiliate link helps to allow this versatility within the affiliate setup.
Through Scaleo’s dashboard, both advertisers and publishers are given greater visibility on their historical, current, and upcoming commission rates, enhancing the accuracy of allocation to affiliate transactions.
So, if you’ve ever purchased through a cashback platform and had your cashback track on your online account, the retailer would have used a particular affiliate model to track sales and commissions. With that being said, not all networks offer each affiliate a specific PID, but instead allocate each link to a PID.
Why do you need affiliate tracking software?
If you made it so far into this post, you already understand that tracking is at the core of affiliate business. However, you need a platform to run and manage this business, and this is where affiliate marketing software (such as Scaleo) comes into play.
Affiliate tracking software (also sometimes referred to as affiliate marketing software or performance tracking software) enables brands and affiliates to gain priceless insight into which elements of their online activities generate the largest number of visitors, conversions, and clicks.
This gives a clear view as to whether or not an affiliate marketing strategy is working. Check out Starbucks marketing strategy to learn from this case study.
Affiliate networks provide a variety of monitoring solutions that allow the ability to monitor a number of different metrics. This enables brands to partner with networks that integrate unique monitoring solutions and payment mechanisms that are ideally tailored to their brand’s main performance indicators (KPIs).
Common affiliate tracking problems
As a pay-for-performance marketing discipline, how transactions are attributed is usually the primary determinant between success and failure.
The main issues with web-based monitoring in the affiliate industry, are:
- Browser privacy settings such as restrictions on third-party cookies – most notably Internet Tracking Prevention (ITP) on Safari Cookie notifications implemented as a response to GDPR Mobile user journeys and lack of in-app conversion tracking.
- Social networks that disallow third-party trackers.
- Advertiser guidelines sometimes prevent certain types of promotion.
Fraud in the affiliate marketing business
Read also: how to prevent fraud in affiliate marketing.
Some types of affiliate tracking are hard to bypass, while others can easily be played around with. Combating fraud requires understanding and identifying various types of fraud.
The most common ones are:
- Click injection: type of click spamming, exposed mainly on Android devices;
- Click spam: this sort of fraud occurs when a fraudster attributes clicks to users who haven’t made them and absolutely unaware of this fact;
- Device farms: also known as phone farms or click farms. These are used to create fraudulent clicks, install and add mobile engagement;
- Cookie stuffing: consist of attaching multiple cookies to users without their knowledge;
- Proxy sales.
- Domain spoofing.
Scaleo’s in-built Anti-Fraud Logic protection algorithm will help you flag and eliminate all the potential bad traffic sources and identify them in real-time.
These problems have progressively developed the heart of a problem that has eroded confidence in affiliate monitoring.
The issues with unstable affiliate tracking conservatively cause a miss-rate of about 10% of affiliate channel transactions.
Although server-side tracking has been touted as an alternative to web-based tracking malfunctions, since it removes the need to submit a third-party HTTP/s request from an advertiser’s site, it is used by fewer than 5% of affiliate advertisers.
Does affiliate marketing need to be a code-based task?
It’s not a new idea.
At checkout, a confirmation code is assigned to a channel or publisher to define the referring marketing channel, replace the conventional cookie relationship, and request conversion.
However, in the face of wilting tracking accuracy networks, the concept of confirmation codes is being reverted to as a method for crediting transactions to the affiliate channel. It seems like a no-brainer.
In reality, it has been used by publishers working directly with advertisers for a few years now.
There is no need for those annoying, frequently unwanted, and much-dreaded cookies to ‘track’ that the user has interacted with the publisher. The existence of the code assigned to them is all the proof that is required.
It all sounds really easy. Right?
The main issue is that allowing the affiliate network to attribute by code would require all transactions to be tracked. Irrespective of the customer’s journey or where the code has been collected, or whether the code is where the network can take credit for the transaction. While this could be good news for publishers and networks, advertisers would lose control of cross-channel deduplication rules and run a significant risk of crediting affiliate commission to transactions that they have never dealt with.
The presence of a code that was given directly to the publisher does not always indicate that the publisher was responsible for the distribution of the code.
Code leakage across the internet is very popular, particularly in the affiliate industry, and can happen as easily from a social influencer as it can from a confirmation code site.
When executed with the right technology and implementation, codes can be a very useful addition, or even a secure alternative, to web-based tracking that is so widely associated with affiliate marketing. Given that the affiliate industry is very discount-centric, it almost makes sense to use one of the most popular discount triggers – the code – to make transaction tracking more effective.
Cookie Session Duration
Each cookie should have an expiry date.
The length of the cookie varies. Some companies, such as Amazon, offer 24h cookie sessions, while others set cookie duration to 365 days. The default is often 30 days.
This means that if a user enters your site through an affiliate link and purchases anything within 30 days, the affiliate that referred the user will receive a fee. If he made a purchase after the cookie had expired, the purchase would no longer be credited to him.
If you want to give your affiliates a longer-term time-frame for crediting the commission, you can increase the cookie’s duration. Unfortunately, there is no way to set the duration of the cookie to “forever.” You can specify a very large number, like 32000 (which is about 100 years) – that way, the cookie is never going to expire.
Clicks from 2 different affiliates – who gets the commission?
The affiliate industry is based on the principle that ‘Last Click Wins,’ which means that any new click can overwrite a cookie under normal circumstances.
This commission shall then be credited to the last referring affiliate.
However, there are several multi-assignment models where the last click model is not sufficient due to multiple affiliates affecting a single user journey. In these cases and in the cookie hierarchy, the affiliate attributed to the sale can differ, depending on various factors.
How to make sure your affiliate commissions are always tracked?
As you can see, with the enormous effort on the advertisers’ and affiliate networks’ part – there is never a 100% way to guarantee that 100% of all commissions will be attributed to the affiliate. Not only can the user erase the cookies from their browser, but they can surf, compare and analyze at work and then finalize the purchase on their home PC. Moreover, the user can purchase after the cookie session has expired.
Bearing in mind all of the above, it’s safe to say that postback URL tracking is a safer and more bulletproof alternative to traditional cookie tracking used in affiliate marketing for over a decade now.
Apart from opting-in for postback URL tracking, you should also ensure that you use powerful affiliate marketing software to power your business and track transactions. Unbeatable uptime and a robust backend will ensure that your business is running smoothly.
Suppose you are an affiliate or a retailer. In that case, the secret to success is to choose a sustainable long-term marketing plan, coupled with high-quality affiliate software, a large community, and a promotion strategy. To deliver the above, it is important to have a reliable affiliate performance tracking solution, monitor lead generation, measure purchase conversions, and reward affiliates for their efforts.
It is important to use tracking tools if you want to monitor the output of your affiliates. There are several tracking methods to choose from, so you can choose the right one depending on the field you’re operating in or on the initiative you’re supporting. Overall, postback URL tracking is a more reliable and secure alternative to traditional cookie tracking. Once you choose a reliable affiliate management software, collaboration with affiliates will be automatic, seamless, and effortless.