<img height="1" width="1" style="display:none" src="https://www.facebook.com/tr?id=1674741459450559&amp;ev=PageView&amp;noscript=1">
The Difference between Advocate, Affiliate, Influencer, and Referral Marketing

The Difference Between Advocate, Affiliate, Influencer, and Referral Marketing

On a fairly regular basis, we work with brands that come to us with separate affiliate, influencer, and referral programs. Or, they demo Ambassador thinking they’ll need different solutions to manage the various variants of a referral.

Here’s what we tell them: At the end of the day, a referral is a referral.

Yes, they come in different flavors, but the mechanics are virtually the same. The reward processes are very similar. And, with the right platform, these variants of referrals can be easily managed and measured in one, seamless experience. Done right, this leads to the same result: Increased brand awareness and revenue growth.

The Unique Characteristics of Various Referral Sources

With all of that said, each referral variation does have unique characteristics and they do need to be approached in slightly different ways. So, to clear up some of the confusion, here’s a high-level breakdown of the most common forms of modern word-of-mouth:

Affiliate Marketing

What it is: A transaction between a company and an entity where the business receives customers (or leads) in exchange for a financial incentive.

What makes it unique: It’s highly efficient because brands specify the cost for a specific action being driven. Examples of effective affiliate incentives include $X per lead (or app download) or Y% of a purchase. Both Netflix and Amazon leverage this strategy well.

How it’s typically managed: The challenge with affiliate marketing is that brand recognition has a big impact on success. Attracting “affiliates” is an arduous process and you often have to compete for “space” on a blog. This can sometimes lead to a bidding war, which lowers your margins.

Advocate Marketing

What it is: Very simply, advocate marketing is a strategy that aims to engage loyal groups of fans, followers, and customers and motivate them to perform certain activities that raise and improve brand awareness.

What makes it unique: I view this subset of customer engagement as a category of word-of-mouth that encompasses mechanisms like reviews, references, and content sharing. Referrals sometimes result from those activities, but they aren’t the primary goal.

How it’s typically managed: More often than not, it’s loosely managed using numerous systems that aren’t exactly designed exclusively for advocate marketing (Google Docs, Excel, email, etc.).

More Referrals. Less Hassle. eBook

Influencer Marketing

What it is: In many ways influencer marketing is a modern take on traditional affiliate marketing. Instead of a network of smaller affiliates driving traffic, however, influencer marketing targets specific people who have large, captive followings.

What makes it unique: Today, someone with a million Instagram followers wields an incredible amount of power to drive interest in a product, and many brands are seeing big results by incentivizing those influencers to talk about their products or services.

How it’s typically managed: In most cases, marketers manage influencer marketing manually — handpicking target influencers, reaching out to them individually, and tracking the program through spreadsheets and email. There are some software programs designed to manage this process, but they aren’t usually flexible to handle anything other than influencers.

Referral Marketing

What it is: Exactly what it sounds like — a strategy for encouraging passionate customers and advocates to directly refer their network to your business.

What makes it unique: Studies show that customers not only seek referrals, they act on them. Referral marketing takes the inherent organic and altruistic nature of referrals and gives brands the tools to incentivize and manage them at scale.

How it’s typically managed: We’ve seen some companies build a referral program in-house and others try to manage it manually through email and other basic systems. But the most successful companies automate the process by using one system to enroll, track, manage, and reward its ambassadors.  

An Argument for One Platform to Rule Them All

Now, let’s revisit the bigger question: Are each of these variations unique enough to require individual technologies? As you might have guessed, I don’t think they do.

Here’s why: At their core, all of these referral sources and lead acquisition channels can be tracked, monitored, and managed in practically the same way. Sure, affiliates certainly require different treatment than customers, and the incentives that resonate with each will vary. Similarly, influencers will obviously be evaluated against different metrics than advocates, and they’ll cost a lot more to engage.

Still, the ways in which all of those different parties are tracked and managed are congruent.

This is precisely why I’m so convinced that the future of our space is a single, flexible platform that delivers all the tools companies need to manage and optimize a variety of campaigns. This approach simplifies the entire process for marketers and, maybe most important, creates a much cleaner experience for customers, affiliates, advocates, and influencers.

More Referrals. Less Hassle.

Posted in Affiliate Marketing, Referral Marketing, Referral Software

Jeff Epstein

Written by Jeff Epstein

Jeff Epstein is the founder and CEO of Ambassador, a leading SaaS referral marketing platform that helps B2B and B2C businesses engage customers and drive revenue. Ambassador's software powers referral marketing for hundreds of top brands, including HP, SAP, Zenefits, SunPower and Sage.

Your Daily Dose Of Marketing

Find out why customers love using Ambassador