What Does Instagram’s Launch of Affiliate Marketing for Influencers Signal For Partnership Marketers?

Instagram made headlines last month when it announced it would be testing new affiliate tools, which will help influencers earn a commission on the sale of certain products and services. In this piece, Partnerize Marketing Director APAC Sarah Kelly discusses the new initiative and explains how it could impact the wider marketing sphere. 

There has been a lot of excitement around Instagram’s latest announcement that the social media and influencer giant will launch an affiliate program to support their creators. As the channel continues to mature, this announcement is more than a spark in the affiliate news cycle – it’s a boon to credibility. This headline paired with the rising ranks of senior-level marketers investing more in the channel in 2021, creates massive upside for our ecosystem. The channel historically has been deprioritised relative to its counterparts in search and social. Step by step, we are striding toward parity and a comfy bench at the CMO’s table. But what does this most recent stride and operational move mean at a practical level for the brands and marketers working with Instagram influencers as part of their affiliate program?

Change Inspires Growth

For those who regard partnerships and specifically affiliate as a cornerstone to their business, influencers have already become an increasing part of that picture, and a more formal one at that. A partnership or affiliate platform provides influencers a path to establish, operationalise, monetise and scale their influencer brands and communities, as well as benefit from ever-improving commissioning models as the relationship takes hold.

On the flip side, the influencer realm itself provides brands and marketers a means to establish profitable reach and gradually discover new, additional productive audiences and consumers for their brand, through new, exceptionally targeted influencer onboarding and expansion. Given its sheer scale and brand notoriety, Instagram’s announcement and move to formalise promises to galvanise the affiliate channel from a volume opportunity perspective. How marketers should approach managing the influencer aspect of their partnership and affiliate programs is still an open question – but it’s an incredibly promising one to ponder, strategically, operationally and even creatively.

Our Industry’s Favourite Word: Collaboration

This new development is also further evidence that the lines between what constitutes ‘affiliate’ and ‘influencer’ are blurred in the sand. Affiliate is a monetisation source for content creators, just as it is for coupon and cashback sites. As the lines between publisher types blur, we will likely see more cross-collaboration. As Marketing, PR and brand teams start to engage with affiliate and social teams, workflow should become less siloed. It’s vital at this stage, as this development unfolds, that partner marketers meet and workshop with those managing their influencer and PR teams in a very intentional way. Teams can align to gel objectives, set targets for influencers/communities and get acquainted with the best platforms, tools and tactics for taking advantage of the opportunity to engage, diversify and grow the influencer layer of the plan. This new development signals the potential for diversified, well-scaled reach – and profitable reach at that, as long as business and commissioning models remain sound and fair.

A Closer Look at the Implications

From a consumer POV, a formalised program such as this certainly eliminates friction in the buying process, allowing audiences and consumers to view influencer content, clicking through directly to products. Seamless process is ideal, of course, but as an industry, we should remain mindful of whether this necessitates the need for disclosures and endorsements. Will consumers readily understand that their transaction is funding a commission to said influencer? While a more prevalent topic in the U.S., as our marketplace ramps up in the influencer sphere, we need to stay ahead of this with our strategic communications and disclosures. It’s become an issue du jour.

The devil is in the details. Simple things like payments and ensuring your influencers are attributed across the consumer journey are not optional here. Upholding best practices here is vital. So, it’s worth noting that there are two very hot questions at the heart of this development. One, will this change the way influencers expect to be paid? And, given our evolution as a channel, will influencer compensation models gravitate to more performance oriented models or will fixed campaign fees remain? Our industry will be watching for this.

The Wide Road Ahead

True launch, adoption and maturation of this programme will take some time. It will be interesting to see the effect on adjacent solutions and tools in the space, some of whom have popularised Instagram discovery and purchase experiences. Will creators continue to use these tools they have come to know for years or gravitate to native affiliate functionality on Instagram? We should think that despite the appeal of sheer scale and reach, it may just come down to which provider offers better commission rates to influencers and who offers better functionality for merchandising and marketing products.

While the platform certainly is already the most preferred for influencers, with integrated affiliate functionality and the content creators’ “Stars” incentives, will this mean influencers will likely dedicate more time and content to this platform? What about other social platforms utilised by influencers? Does more content and reliance on Instagram jeopardise TikTok, especially as the TikTok Creator Fund is not operating in Australia? There are many questions that need to be addressed by brands collaborating with influencers, particularly those part of their affiliate program. Whilst this move by Instagram certainly validates the channel and its approach, partnership marketers are often working with influencers across a variety of platforms, so it does raise the question of whether it’s a simpler approach to continue to work with technology partners like Shopping Links and RewardStyle.

No matter the considerations, and the journey to navigate ahead, this move by Instagram truly validates the partnership and affiliate channels’ proven pay for outcomes approach. Whilst it will be interesting to see how this develops, it’s important for marketers to move into a highly cross-functional, collaborative mode with their teams, methodically plan and ensure alignment within their own influencer management. Everyone in this picture – digital, affiliate, partnerships, social, influencer – has spent time pioneering on their own respective frontiers. We all intimately know what it’s like to be an emerging channel proving its concept and worth. So, on top of our own gradual and pronounced evolution to maturity, Instagram’s move effectively opens up a wide open field of additional opportunity. It’s an incredibly exciting time to be at this cross-roads, as a collective force well, to take our greater ecosystem to new heights.