Affiliate Marketing Guide for Financial Services

Financial institutions (FIs) looking to maximize their market reach are going beyond traditional marketing tactics to engage with potential customers. This includes understanding how each target audience interacts with financial products and the nuances behind creating messaging and connections that resonate. 

Conventional advertising such as print, direct marketing, and events have historically proven effective, especially with older generations (less digitally inclined Baby Boomers in particular). However, younger consumers respond to marketing differently than their predecessors, preferring (and expecting) more interactive and personalized experiences. This is complicated further by the fact that Gen Z and Millennials have more options than ever before, as well as different financial and socioeconomic concerns than their elders, requiring FIs to take a different approach to engage and acquire these individuals as customers.

Affiliate marketing presents a unique opportunity for FIs to tap into younger demographics and expand their overall brand presence, especially online. Gen Z and Millennials are more likely to do their own research when it comes to financial products and services, and FIs that embrace an effective affiliate marketing strategy can be front and center as these consumers explore their options, evaluate reputation, and assess value alignment across vendors and platforms. 

What is Affiliate Marketing for Financial Services?

Affiliate marketing is the process of partnering with other brands or influencers to promote products and services to their built-in audiences. To do this, financial institutions can establish a commission or revenue sharing model to compensate the partner managing the advertising campaigns.  

In contrast to traditional marketing approaches that rely on directly messaging to potential customers, affiliate marketing takes the pressure off of the FI, allowing the partner to manage product promotions through unique approaches. While FIs may collaborate on approved messaging or creative media, the affiliate partner is responsible for spreading the message across its audience. 

Affiliate marketing can look different depending on the FI, selected partner, and audience preferences. Content marketing pieces can incorporate FI products or services into recommendations lists or thought leadership articles as content trusted by an established readership. Dedicated landing pages can offer visitors incentives such as how-to guides or discounts for registering their information. Influencers can also make direct recommendations for products and services in newsletters, live reads during podcasts, or banner advertising directing readers to more information. 

Affiliate marketing also allows FIs to reach previously untapped audiences with very specific purchasing needs and behaviors. Traditional methods such as paid advertising and website marketing assume that consumers will be proactive in seeking out brands or will come across content via other organic means. Undertaking an affiliate marketing strategy can help FIs achieve brand placement on other platforms where those consumers may be spending their time on related topics with a more passive intent to purchase. The result can be more qualified leads generated by topical, timely positioning of FI services by brands or influencers that consumers trust.

Another appealing aspect of affiliate marketing in financial services is the opportunity for a solid return on investment (ROI) for everyone involved. FIs gain access to a higher volume of more qualified leads and are able to fill their pipelines with more regularity and relevancy. The affiliate partner is likely to experience higher revenue generation than in other industries, largely due to the higher transaction amounts and volume available through the promotion and sale of financial products.

How Financial Affiliate Marketing Works

Affiliate marketing is designed to promote one brand’s products or services through the reach and assets of another brand. Typically, this happens through a topical or industry-based alignment where the partner and its audience can potentially benefit from what the FI has on offer. By creating additional value, affiliate marketers can continue engaging their audiences while ensuring extended market penetration for the FI. 

The majority of affiliate marketing today is conducted online or through omnichannel campaigns where brands and influencers can reach their audiences through website messaging, podcast advertorials, email newsletter inclusions, or mobile app listings. 

There are a number of different affiliate marketing structures that can be leveraged by FIs and their partners. However, most work on a well-defined commission basis where what constitutes a referral, lead, or customer is outlined and set up in a verifiable manner. Depending on a given FI’s goals, different structures could be more beneficial than others. 

For a volume-focused structure, the FI and partner define the goals of a campaign (i.e. lead generation or customer acquisition), and the FI agrees to pay based on campaign performance. In this model, partners are motivated to keep FI brands top of mind with their audiences to achieve or exceed established benchmarks and receive the corresponding compensation. Similarly, the arrangement can include tiered commission or bonuses as different objectives are achieved. 

The retention-focused approach starts with the FI and partner establishing the total cost per lead (CPL) or cost per acquisition (CPA). Then, the FI makes an initial payment to the partner to incentivize an initial volume of leads or customers for the partner to generate. Residual payments are issued based on customer retention or upsell numbers to encourage lead quality over quantity.

Key Benefits of Affiliate Marketing for Financial Products

Affiliate marketing presents several distinct advantages to financial institutions looking to vary their approach to customer acquisition and brand awareness. When it comes to financial products in particular, the benefits of affiliate marketing go well beyond expanded exposure.

While it might sound costly to pay for leads, affiliate marketing is known for its unusually high ROI. Fifty-four percent of marketers count affiliate marketing as one of their top three approaches to customer acquisition, beating out other pay per lead tactics including paid search. In fact, brands implementing affiliate marketing achieve a 1,400% return, compared to a standard ROI for traditional marketing of 500% for successful campaigns. 

This is partly due to the minimal resource costs required by the FI. Aside from providing branding guidelines, the FI relies on the affiliate partner to execute the marketing campaigns and reach out to their contact network. This includes everything from scheduling to creative development. The performance-based structure of affiliate marketing also ensures that the FI only pays for legitimate leads or customers, driving down costs associated with traditional marketing that relies on impression data or higher, less targeted traffic statistics.

Another benefit is that when an FI partners with a brand or industry influencer, the audience for the FI’s products is built in from the start. In contrast to traditional marketing, where messaging is spread out to broader audiences and only a fraction of viewers are potential customers, affiliate marketing narrows down the field automatically with an existing audience already qualified with an interest in the related topic. 

This can help improve conversion rates since the recipients of any affiliate marketing messaging are not only likely to be compatible with the FI’s products or services but also have an established, trusting relationship with the affiliate. This can drive more qualified traffic to the FI to meet their marketing goals, which can result in higher sales and lower churn figures. 

Building a Financial Services Affiliate Marketing Strategy

FIs first need to segment their target audience with specificity. Instead of dividing consumers based on general criteria such as banked versus unbanked, or current versus former customer, considering the financial needs and concerns of each demographic is critical. Using broader measures may make it quicker to turn out marketing campaigns (after all, 6% of Americans are unbanked, creating a tempting market for broader messaging), but targeting behaviors and beliefs can help with market penetration and better affiliate marketing alignment.

With target segmentations in place, FIs should ensure that they have a solid digital presence. The vast majority of affiliate marketing takes place across web and mobile platforms, primarily leveraging email, websites, and social media. While the affiliate partner will be responsible for promoting and distributing marketing materials, the FI may need to provide landing pages and tracking mechanisms to support the operation and compensation behind these campaigns. Having their own social media and website content for the affiliate to reference and link can help reduce barriers to lead generation. 

Establishing clear metrics for success is also important to building an effective financial services affiliate marketing strategy. Measurable goals with clear definitions can help dispel any misunderstanding between FI and affiliate marketer. Aligning this strategy with an existing marketing pipeline can also help the FI determine how many leads are needed on a regular basis in order to meet the desired conversion rate. All of this can translate into more consistent, predictable sales figures. 

Finding the Right Affiliates for Financial Services

Selecting the right affiliates to work with comes down to more than just product alignment. FIs should choose to work with financial services marketing affiliates who are well-known and well respected in their niche. Partners who are already established with a customer base or readership can improve overall conversion outcomes.

FIs should have an intentional approach to selecting affiliates that not only have access to critical target audiences but also align with their core values. This is especially important as affiliate marketers become an extension of the FI’s brand, and consumers may assume that the perspectives and philosophy of the affiliate also reflect those of the FI. The partner and the FI must also be certain to disclose any required relationship details to ensure compliance with regulatory requirements. 

The options available for financial affiliate marketing are vast. Independent blogs run by small organizations or finance influencers offer direct access for brands to get in front of curated, engaged audiences. This can help with brand awareness and lead generation as consumers become more mindful of the options available to them for relevant services based on the target segment. Affiliate marketing for financial services can include co-branded emails or promotional article content with dedicated links to calls to action and next steps. 

Financial comparison websites are another avenue for FIs to explore. These sites are used by consumers actively looking for financial products that meet certain specifications. By aligning affiliate marketing for financial products with these websites, FIs can get in front of engaged consumers with viable solutions. 

The right affiliate partner will also have an omnichannel network they can use to send messaging and offers to their contact database. This can help increase FI exposure and market penetration along with the added benefit of bolstering search engine optimization (SEO) efforts through backlinks and mentions by established, indexed third-party websites.

Best Financial Affiliate Programs to Consider

Simply put, financial services affiliate marketing comes down to any opportunity a FI has to have their products and services promoted by a third party. This can take many forms including influencer promotion on social media, listings on investment platforms, and even credit card offers. 

The most successful financial affiliate marketing will balance commission structures with attainable goals that track back to organizational growth metrics. They will also cover a range of products or services of interest to a specific target audience, made available to those potential consumers by a reputable third-party brand, thought leader, or influencer. Established programs hosted by existing platforms will likely have integrated solutions for tracking and promotional distribution. These will make it easier for FIs to partner with affiliates and see results faster. 

Compensation management is also a big part of launching affiliate marketing for financial products. Fixed commissions, pay per action, cost per impression, CPL, and CPA formats all have their unique advantages. FIs should consider structuring relationships with affiliates that balance volume and quality incentives and that make tracking and payments easy to attribute. 

Financial Affiliate Marketing Examples

Nerdwallet helps financial consumers make decisions about their personal finances by providing opinion articles, news, and offers. The website’s focus is to help educate readers and has an established level of trust with its contact base. FIs can list their products for lead generation on the website or work with individual content creators to have their products featured in topical articles. 

Credit Sesame takes a different approach to helping consumers make financial decisions. The comparison site lists out financial products and services by different categories that users proactively search to compare different rates, inclusions, and benefits. FIs can list their products for consideration and offer incentives for consumers to act on.

The Financial Diet is a popular YouTube channel run by industry influencers who offer financial advice and personal perspectives. Brands collaborating with the channel gain exposure to a built-in audience of over 1.2 million followers already qualified as interested in financial products and strategies. FIs can collaborate with influencers like The Financial Diet to put their brand and unique promotions in front of viewers prime for incentives.

Compliance and Regulatory Considerations in Financial Services Affiliate Marketing

One of the most important aspects of financial affiliate marketing is to ensure the relationship and messaging are compliant with regulatory requirements. To do this, FIs and their partners must understand and abide by all applicable laws.

A key concern is privacy and data protection or information sharing since the affiliate partner will be collecting consumer data and passing it along to a third party, the FI. These relationships should be disclosed and transparent while using clear language so consumers understand exactly how their information will be used by everyone involved. 

FIs should have their affiliate marketing programs reviewed by legal teams that can prepare guidelines to share with their partners. Ongoing monitoring is also important to ensure compliance for the long term, especially as the requirements and concerns around data protection and usage evolve. 

Measuring Success in Financial Services Affiliate Marketing

Any number of key performance indicators can be used to determine the success of an affiliate marketing campaign. Establishing clear goals from the start and defining measures of success for the affiliate partner will help FIs ensure campaigns produce the desired results. Here are just some of the ways FIs can measure affiliate marketing program success.

  • Clicks: Indicates exposure and helps with brand awareness and recognition efforts.
  • Leads: Indicates general interest by a consumer and helps with sales outreach efforts.
  • Conversions: Indicates customer acquisition attributed to a specific marketing campaign. 
  • Retention: Indicates the overall customer lifetime value (CLV) for a specific account including upsell and cross-sell opportunities. 
  • Value: Indicates the average order value to determine maximum account penetration. 

Affiliate Marketing Programs That Go to Work for Financial Institutions

Now more than ever, financial institutions are leveraging unique marketing programs designed to maximize their reach, brand awareness, and lead generation. Affiliate marketing for financial products offers FIs a more targeted way to get their messaging in front of consumers who have already taken an interest in financial topics, helping to better qualify any leads generated through joint marketing efforts. 

At Vested, we take an all-encompassing approach to helping financial marcom leaders diversify their reach and get their messaging, and products, in front of the right audiences. Through a fully integrated marketing strategy, Vested’s clients access the benefits of traditional marketing tactics coupled with innovative outreach including influencer marketing. Learn more about how Vested can help your company get its story in front of the right audiences. 

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