Ultimate guide to affiliate marketing in financial services

Contents:

• The future of financial services companies
• Challenges for financial services companies
• How does affiliate marketing work?
• Affiliate marketing vs traditional advertising
• Why is affiliate marketing a good fit for financial services?
• 5 Benefits of finserv affiliate marketing
• How does affiliate software work?
• How to get started with finserv affiliate marketing

Affiliate marketing (brands working with partners to promote products through great content) has experienced incredible growth in recent years. The industry was worth over $13 billion in 2017 alone. This type of cost-effective marketing strategy drives traffic and revenue for companies selling financial services and products (also known as finserv).

This guide takes a look at how finserv brands and affiliate marketing work together. Understanding the benefits of financial services affiliate marketing boosts brand awareness and propels business growth — for brands in the financial world and affiliates looking for partners.

The future of financial services companies

Finserv encompasses a wide range of businesses, products, and services. Retail banks, stock brokerages, and mortgage providers fit into the category. The list also includes credit card issuers and state-of-the-art applications. Like Acorns or Patreon, these financial tech (fintech) companies fall within finserv. Fintech apps and services often grow faster than many traditional finserv companies. In fact, investments in fintech brands hit almost $136 billion in 2019 alone.  

Between larger finserv players and expanding fintech, the financial services industry has seen massive expansion. However, despite all this growth, clear obstacles still exist for finserv brands.

Challenges for financial services companies

Finserv companies often act as substitute teachers — providing consumers with personal finance education since schools hardly cover the topic. Finserv brands frequently take on the role of building strong financial foundations and trusting relationships with consumers. As much as 92 percent of millennials do not trust banks, placing the responsibility on finserv brands to build trust and communicate complex topics. 

Customers may dismiss a fantastic finserv product if it is poorly marketed or explained. Finserv promotion walks a fine line: Keep the message clear and engage while communicating the facts. 

Consumers hesitate to trust their money to brands and services they do not understand. Finserv has built-in layers of terminology and jargon, which exacerbates mistrust and poor financial literacy. Financial decisions often carry serious emotional stakes as they can impact a consumer’s financial future. As a result, consumers gravitate toward finserv brands that build relationships and instill confidence. Affiliate marketing helps brands effectively accomplish these goals.  

Traditional advertising often falls short, as it sometimes relies on outdated tricks and strategies. However, affiliate marketing offers an alternative that works much better for finserv brands.

How does affiliate marketing work for finserv?

Affiliate marketing is a performance-based system. Rather than investing a large marketing budget upfront, brands work with affiliate partners to drive traffic and sales. 

For instance, a financial blogger recommends an investment app or service. The blogger receives a commission when a reader taps on a link, downloads the app, and signs up. Affiliate deals vary, and payouts occur at different stages of the interaction.

But, overall, affiliate programs are a results-driven marketing strategy, with real interest and sales resulting in affiliate payouts. Affiliates are motivated to integrate recommendations into their content because they earn revenue every time a reader purchases through their links. 

This unique type of marketing sets it apart from general advertising campaigns and methodologies. Next, take a look at why affiliate marketing is better. 

Affiliate marketing vs traditional advertising

Commercials and ads are disruptive by nature since they pull consumers away from the content they want to engage with. Ad campaigns spread a wide net, hoping to catch the attention of a small number of people interested in a product. On the other hand, affiliate marketing provides a significantly more personal and customizable approach.

Affiliate partnerships offer finserv brands the chance to position themselves in the best context via recommendations created by trusted influencers or financial gurus. All parties involved benefit:

• The finserv company gains trust and access to valuable audiences 
• The affiliate gets a commission
• The consumer gets honest reviews or recommendations on high-interest products

Why is affiliate marketing a good fit for financial services?

Businesses value affiliate partnerships because they appear as advice, not advertising. For finserv brands, affiliate marketing reaches the right kind of customer at the right moment in the buyer’s journey.

Get in front of ideal customers

Finserv brands often look for customers with a base level of knowledge about financial products and services. Convincing someone to sign up for an investment app or credit card fails if they misunderstand the basic concepts and terminology. 

Customers at a transition point in their lives are a good market fit for finserv brands. If life events encourage someone to start budgeting and saving or building credit and investing, finserv companies benefit by connecting with them. 

Yet finserv is not a homogenous industry. Some financial businesses want to focus on different markets than others. Some credit card issuers look for established consumers with high credit scores. Other finserv companies focus on building credit for beginners. Fintech startups and large retail banks have varied priorities. 

Since everyone deals with finances throughout their lives, each of us fits into potential customer categories for certain finserv brands. Marketers hope to find the right people through broad advertising campaigns with traditional ads. However, finserv affiliate marketing allows brands to pinpoint audiences where they stand to gain the most traction. 

Then, by connecting with the right affiliates, finserv strategists set themselves up for success. Keep your ideal customer in mind when you set up an affiliate program.

5 Benefits of finserv affiliate marketing

Now that you know about ideal customers for finserv brands, what are the benefits of affiliate marketing?

1. Reaching new customers

Traditional advertising rarely finds new customers. Using the same worn-out communication channels does little to reach potential customers. Here’s where the targeted nature of affiliate marketing shows its strength.

To reach a specific audience, find influential voices in chosen communities and partner with them. Once a finserv company has dialed in its ideal customer, affiliate partnerships come next.

2. Building trust

As mentioned earlier, the finserv industry faces trust and awareness challenges. Affiliate partnerships boost great products through the expertise and authority of financial writers, bloggers, and influencers. These communicators have built their audiences and followings through personal knowledge and skills.

As affiliates, they bring benefits to the table and help brands build name recognition and trust. Without established trust, purchases rarely occur — especially when services require financial investment or information.

3. Evergreen content

Ad campaigns and commercials often have short lifespans. Stand-alone advertisements without a strong hook fail to keep people coming back. But affiliate marketing succeeds in that same scenario. By tying brand links and recommendations to strong content, consumers can find an easy path to your finserv brand.

As people go back to learn from website guides, scroll through social media, or listen to podcasts, affiliate promotions keep spreading. When finserv brands choose the right affiliate partners, they ensure evergreen messages and connect with customers through those audiences. 

4. Decreased risk

Affiliate marketing holds less up-front financial risk than traditional ad campaigns. Rather than getting locked into a preplanned marketing strategy, these partnerships allow affiliates to recommend finserv brands in different and unique ways. Brands do not dictate a monotonous message for everyone to echo.

Instead, partners authentically promote finserv products within their content, removing the risk of a large marketing campaign missing the mark and wasting money. Partners receive commission once a customer makes a purchase or signs up.

Rather than risking marketing dollars upfront, affiliate programs encourage a sustainable and long-term financial marketing strategy.

5. Actionable data

Accurate sales metrics and customer data create the best foundation for affiliate partnerships. Affiliate partnerships make that simple. Each sale links to a specific partner, highlighting successful conversion and click-through rates strategies. This data informs decisions on future affiliates. 

Instead of guessing how many sales a banner ad generates, finserv affiliate marketers have concrete numbers that help them make more informed and nuanced decisions for the future. Also, actionable data helps automate tracking and payments. 

How does affiliate software work?

Affiliate software makes partnerships possible. Partnership platforms like impact.com cover the entire arc of the affiliate partnership. Instead of requiring a team to track sales or manually total up commissions individually, affiliate software saves time and avoids mistakes by streamlining the entire process. The software does not stay rigid either. It can be scaled up so larger companies can handle different affiliates and marketing campaigns. 

Some finserv brands might need customizable support or focused attention on a specific few affiliate partners. Affiliate software platforms make partnerships smoother and more effective. It’s helpful to keep these benefits in mind.

Sales and commission

Manually tracking each sale or website view increases the chance of mistakes. Late or incorrect commission payments can damage the relationship between a finserv brand and its affiliate partners. The steps involved in triggering a payment are complicated. Some brands pay affiliates when a consumer follows a link, while others wait until a credit card application is approved. 

Each different finserv product requires nuanced tracked decisions. Here’s where well-designed affiliate software shows its value. Affiliate software correctly tracks sales and pays commission every time, building trust between companies and affiliates. 

Data and demographics

Tracking sales data and customer demographics with affiliate software makes it easier for brands to find their target audiences. Affiliate software breaks down conversions and sales into actionable data, informing future decisions on affiliate partners, discounts, and marketing strategies. 

You need a robust system to handle this data, especially when many different affiliate partners are involved. Affiliate software displays data on customizable dashboards and shows actionable information every step of the way. It helps you produce well-informed decisions and strengthens partnerships for the future.

How to get started with finserv affiliate marketing

Now that you understand the benefits of affiliate marketing, here’s the best way to get started with finserv affiliate marketing.

As a finserv brand, it’s important to build effective partnerships to make sales and find new customers. These four steps spell out the whole process:

1. Join an affiliate platform with software and systems that bring together finserv brands and reputable affiliate partners. 
2. Communicate your brand’s message and the strengths of your products and services. Potential affiliate partners need to understand your business strategy and promote your products without confusion or hesitation. 
3. Partner with the right affiliates to reach your ideal customers and target audience. Conversions and sales improve when you find affiliates with shared values and interests.
4. ​Pay compensation after consumers follow affiliate links. Work out a percentage payment plan with affiliate partners or offer a flat fee for agreed-upon milestones. 

If you’re an affiliate, here are four steps to finding finserv brand partners:

1. Join an affiliate marketplace designed to connect you with the right brand for your content. With impact.com, you can connect with thousands of reputable brands looking to partner with great affiliates. Your affiliate partnerships help brands connect with your audience and seamlessly bring commissions with well-designed automation tools. 
2. Decide which products and services you want to link and promote. It’s essential to be aware of your interests and strengths as a communicator since you’ll reference and recommend these brands in your future work, too. Sharing values goes both ways, so set up your partnerships for success. 
3. Once you spell out the details of your affiliate partnerships, add trackable affiliate links to your blogs, podcasts, social media posts, etc. The more naturally and smoothly integrated your affiliate recommendation, the better the results.
4. Earn commission based on your agreements with the finserv brands you recommend. 

Moving forward in affiliate partnerships takes planning, cooperation, and usable metrics. Everyone benefits by partnering with the right people and finding ways to integrate affiliate links and content authentically.

Getting started in affiliate marketing

Are you keen to learn more or get a headstart in financial services affiliate marketing? Contact a growth technologist at impact.com to set you up for success by helping you find the right partners and connect with your ideal customers. 

Want to know more about affiliate marketing? Check out these other impact.com resources:

• Ultimate guide to affiliate marketing: What is affiliate marketing and how to get started (ebook)
• Back to basics: What is affiliate marketing? (blog)