Introduction
Affiliate networks are the backbone of digital marketing, providing brands with access to publishers and performance-based marketing solutions. However, despite their scale and connectivity, most networks operate as intermediaries, focusing on facilitating transactions rather than providing expert guidance on growth strategies.
But what if they did more?
What if networks didn’t just connect brands with publishers but actively helped them navigate growth, eliminating costly trial and error? The reality is that brands—especially startups—spend years making mistakes, burning budgets on misaligned strategies, and struggling to find their footing in competitive markets. With the right guidance upfront, they could avoid these pitfalls, accelerating their path to profitability.
This case study explores the real impact of expert guidance, why agencies capitalize on this gap, and how networks could increase their long-term profitability by offering more value.
The Cost of Trial and Error
For new brands entering the market, the biggest challenge isn’t just generating traffic—it’s making that traffic work effectively. Brands spend years:
- Testing different marketing angles without clear direction
- Partnering with affiliates that don’t align with their audience
- Adjusting offers, creatives, and messaging in an attempt to ‘crack the code’
- Burning budgets without understanding the key drivers of success
All of this could be avoided with the right expertise from day one.
Agencies recognize this pain point, which is why they position themselves as the solution. They offer expert guidance, optimization strategies, and data-driven decisions to help brands get set up for long-term success.
But here’s the catch: agencies know that brands are using them for their expertise, so they lock them into six-month contracts to ensure they extract their value before the brand eventually pulls operations in-house.
In other words, the brand gets what they need—a solid foundation and structured growth strategy—but the agency also ensures they secure their piece of the pie. After all, no one wants to bake the pie just for someone else to eat it.
The Network’s Role: A Missed Opportunity
Affiliate networks, despite being at the center of the ecosystem, rarely offer this level of strategic guidance. Instead, they act as a marketplace, leaving brands to figure things out on their own.
However, some networks do offer agency-type services in the form of fully managed programs. The issue? The cost is often far higher than the agency option.
Agencies operate in a competitive environment, meaning their pricing must remain attractive to clients. Networks, on the other hand, are closed systems. Clients understand that a network-managed program is likely to be the best way to optimize their affiliate efforts, but the cost is prohibitive.
In reality, most agencies offer comparable expertise at a fraction of the price. While networks have exclusive data and direct access to publishers, they charge a premium for their services—one that startups and growing brands often can’t justify.
This creates a paradox: clients know the network is probably better at managing their program, but the cost drives them to agencies instead. Agencies then provide the foundational strategy, brands scale up, and eventually, they pull their affiliate programs in-house, leaving both the network and agency behind.
The Long-Term Impact
The irony? If networks played a more active role in guiding brands from the start, they would actually profit more in the long run.
By ensuring brands succeed early, networks would see:
- Higher client retention (since brands wouldn’t churn due to lack of results)
- Increased commission structures (as brands scale faster)
- Stronger reputation and trust, leading to more inbound interest from quality brands
This isn’t about networks replacing agencies; it’s about them becoming more than just a marketplace and ensuring their brands have a clear path to success. Instead of just providing access, networks should focus on guiding brands toward growth—something that benefits everyone in the ecosystem.
Bringing It All Together
The affiliate marketing space is full of players—brands, networks, agencies—all trying to carve out their value. Everyone wants a piece of the pie, but the brands—the ones actually baking it—often end up paying the most before they can even enjoy a slice.
If you find yourself in this position—needing expert guidance but hesitant to invest in an agency due to high costs and long-term commitments—talk to the AMG team.
We’ve got you covered.
Affiliate marketing isn’t a guessing game—it’s a strategy. With Affiliate Marketing Group, you get the right affiliates, the lowest costs, and ongoing expert guidance to help you scale.
- Ready to launch your program? Let’s talk.
