Approval Rate in Affiliate Marketing

Affiliate marketing, usually, involves three parties: advertiser, affiliate (media buyer), and publisher. They earn their income differently, which is why their aspirations may not align at times.

• Advertisers — aim to sell their products by all means necessary
• Affiliates — promote the products to a wider audience and get compensated
• Publishers — own a vast audience and get paid for letting the people see the ads

When unrestrained, affiliates care only about maximizing brand awareness and increasing the traffic volume — they don’t care about actual sales being made. This creates a moral hazard, when the affiliates might try to generate fraudulent, incentivized, bot, and just trash traffic — to increase overall volume.

Approval rate is the metric, reflecting the quality of traffic. Advertisers rarely pay commissions to the affiliates right away and rather keep the money on hold. Advertisers want to ensure that the goods are actually ordered and paid for. Let’s say an affiliate brings 200 leads, which are put on hold — the commission is not paid yet. The advertiser then manages to finalize the purchase only with 150 of them. By dividing these numbers, we get 75% — that’s the approval rate in our case.

Approval Rate = Converted Leads / Total Leads * 100%

The affiliate is rewarded for 150 confirmed leads, not for 200 generated. All the losses are covered by the affiliate — creating an incentive to improve the quality of traffic, besides growing its volume. This way, the loss can be minimized.

Factors affecting the approval rate

Care to know why generating incentivized traffic is bad? Because incentivized users might have clicked on your ad and even ordered something, but once the call center dials them — the users won’t proceed with the order because they don’t need it. Besides traffic quality, the approval rate can be either improved or lowered by a bunch of other factors too.

Ad honesty. Misleading advertising will be revealed during checkout. The user will simply refuse to pay if the actual product qualities do not match those mentioned in your ads. That’s why advertisers are unanimously against false claims.

Informational consistency. If the user initially sees one price or bonus and then is introduced to another — they are more likely to put the purchase on hold and take their time to explore the product in-depth or, more likely, order something else.

Ad campaign quality. Trash, bot, incentivized, and fraudulent traffic is not paid for. Also, the users who ordered but then changed their minds lower your approval rate. To improve the quality of your traffic, besides staying honest and consistent, you gotta set up your targeting settings properly and generate genuinely engaging content and creatives. Furthermore, all the funnel elements ought to synergize — for instance, a wrong check-out page can bring down the whole funnel.

Precise targeting. There are three key factors, affecting the perception of the audience: gender, age, and level of income. A product might be ubiquitous in terms of targeting, but the approaches will be different for a 22 y.o. college-student and a 55 y.o. Your GEO also matters: there is a correlation that lower-tier GEOs have lower approval rate, because of a less well-off audience.

Offer history. On average, an eCommerce offer loses all its potential in 3 months. Other products enjoy evergreen demand, e.g., microloans or iGaming. And while the old offers can have some stats recorded, the new ones lack the luxury like that. You have to rely on your intuition or use some tricks we’ll tell you about in the next section.

Call center efficiency. This is especially true for the mass market of eCommerce, where the quality of call centers might not meet your expectations. The “specialists” might either be too pushy or call back after a few days passed. In any case — the UX suffers and clients regain their consciousness, even if your ad campaign succeeded in evoking the right emotions.

Advertiser’s honesty. Say hi to shaving! Yeah, life’s not fair — but you are not helpless. We’ll talk about that more in the following section.

After picking up an offer, the affiliate can only control their traffic quality and campaign design. The work of call centers or a landing page design is out of their grasp. But the affiliates are not helpless, as long as they prepare accordingly.

Improving approval rate

While the approval rate affects your profit, the correlation is not that straightforward. You can have two offers with 99% and 20–30% approvals respectively. Despite its mediocre approval rate, the latter might end up being more profitable. Still, improving your approval rate is better than doing nothing, if you want to contribute to your income growth.

Stay honest & enjoy your work. Basic things, but we can’t get away without mentioning them. Don’t lie about the product you promote. Also, enjoy all the ups and downs of affiliate marketing — they are your road to excellence. If you don’t like testing, exploring, making mistakes, and working night hours — the affiliate marketing might be simply not your cup of tea. There is nothing shameful in admitting that, as long as it helps you to move forward and progress in life. If, however, you like challenges…

Do your research. Remember us telling you don’t control the work of the call centers? Yet, you can choose the offer you want to promote. Find as much info as possible before opting in for anything. Read the reviews online, and if they are old — chances are the offer has been promoted too much. Remember, your potential clients can also easily access the reviews and they will do so.

Use spy tools. Learn how frequently the creatives for a certain offer pop up — too many of them is a sign of the offer being promoted too much. Too few is also no good — besides being new, the offer might simply have inadequate conditions or low conversion rate. Yet, whenever you find an offer with few creatives — test it, ask questions later.

Test calls. Counter poor quality call centers with testing dials. Order something, receive a call, buy/don’t buy, and decide for yourself whether the offer is for you. Nobody forces you to take a specific offer.

Calculate the profitability of approved lead. High approval rate is not a guarantee of high profit. Calculate the profitability of a single approved lead by learning Conversion Rate, Cost Per Click/Mille, and payout rate. 

Countering approval rate dropping

Approval rate is not a direct indicator of your potential profit. Still, having a high approval rate is better than having a low one. Here are the main reasons for the approval rate dropping and how to remedy the situation:

1. The creative is done for. When a creative gets repetitive, it stops being creative. Try another one.
2. The offer is done for. Same story as with the creatives. Act proactively and read the reviews, monitor spy tools, dial cal centers, and switch to other offers if needed.
3. Advertiser’s technical issues. Late calls, hard sells, website problems — either change the offer or contact the advertiser, but only if you’re confident the problem is on their side. Solidify your claim with as much proof as you can get, and remember — this is their profit on the stake too.
4. Deliberate shaving. This is the last thing you should think of, when all the explanations above fail to justify the low approval rate. A good sign of shaving is a sudden plummet in approval rate, i.e., 50% to 20% overnight. Try to settle the matter with the advertiser — misunderstandings can happen. But don’t let your kindness be taken as a weakness, if you are not paid consistently — take decisive action. Also, inform the forums and as many people as you can. Probably, this won’t get your money, but at least will make a difference for your fellow affiliates.

Conclusion

Approval rate is not something essential for great performance, but keeping it in check can be useful. Approval rate shows for how many leads the affiliate is rewarded. Do your research, never neglect testing, use spy tools, read the reviews, stay honest, and perfect your funnels day & night. As long as you like what you’re doing — this should come naturally.

On a more pragmatic note, not always low approval rate is your guilt. Prevent falling into the trap of poorly functioning call centers and execute test orders before opting in for an offer. Sometimes, an advertiser might try to shave, but that’s the last thing you should assume, when everything else doesn’t cut it.