Why Sponsorships Reign Supreme Over Affiliate Programs: A Comparison
When you decide you want to start working with creators to promote your product or service, the first thing you’ll have to decide is what kind of agreement you want to have with them. You have two choices: a Sponsorship or Affiliate Program. Today I’m going to outline some facts about each type (and explain why you’ll want to choose Sponsorships!)
Let’s start with some basic definitions.
Sponsorship — An agreement to pay an individual or organization a fee (sometimes a combination of physical goods on top of money) in exchange for promotion of a particular product or service.
Affiliate Program — An arrangement that is solely performance-based, where an individual part of an Affiliate Program will receive a small commission for sales made with an Affiliate code or link.
Three great things about Sponsorships:
- Streamers get paid a previously-agreed amount for their services so everyone knows what to expect
- It’s reasonable to ask specific things of a streamer and know that they will actually happen because you’re paying for them
- Streamers are paid fairly for their time and effort, which supports a mutual respect between the streamer and the brand
Three not-so-great things about Affiliate Programs:
- Streamers often don’t make a lot of money from these programs, and seeing such small payouts can be discouraging
- You get a mixed-bag of results, as some creators will put a lot of effort into it, and others (who know their value) simply won’t
- It’s unrealistic to ask much more than posting their Affiliate link in their bios, as you’re only paying them a small percentage per-sale
When it comes down to it, sponsorship deals are better for both the streamer and the brand. You get more genuine promotion from the streamer because they’re actually being paid fairly for their time. Affiliate programs are cheap and take moderate effort from brands, but ultimately aren’t worth the time. Unless you work with a streamer with a massive audience, say Ninja, you’re not going to get much back. No matter the size of the streamer, Affiliate codes often get uploaded to the streamer’s bio or Twitch panels and are left to collect dust. Why would they put any effort into selling a product they’re only getting a minuscule commission from?
Yes, sponsorships are typically more work to execute, but they don’t have to be! Talk to us at Powerspike about your goals and we’ll create a campaign tailored just for you, and manage everything so you don’t have to! We put in the work, you reap the reward — it’s just that easy!
