Creating a creators’ ecosystem. Can Daraz make its affiliate program work?

We all have a youtuber, instagram influencer, or even tiktok sensation whose content we enjoy watching and whose opinions we relate to and trust. Take for instance, Sunil Munj, the CEO of PakWheels, Pakistan’s biggest automobile website, who uploads videos on his youtube channel reviewing everything related to cars. Munj’s car reviews, recommendations for the right tires, the best workshops, and even the type of cloth used to clean automobiles are followed religiously by people who watch his videos. Now imagine if Sunil Munj’s videos included website links that redirect you to the exact products he uses, brand loyalty and trust would persuade a large proportion of viewers to click on the link. This is exactly what affiliate marketing is all about. 

Affiliate programs involve content creators partnering with a brand to market their products by attaching a unique link that tracks the traffic and sales generated through an influencer’s social media accounts.

Affiliate programs are a globally used marketing tool as they provide quick and easy access to relevant demographics that helps brands capture the interest of potential customers or buyers. Think Amazon’s global affiliates and Noon in the middle east. Yet, the presence of affiliate links in Pakistan is a process that is yet to be streamlined.

However, with the launch of their Influencer Hub, it seems as though Daraz, a South Asian e-commerce platform that operates in Pakistan, Bangladesh, Sri Lanka, Nepal and Myanmar,  may have just cracked the code for effective marketing. Ali Rizvi, the Head of Influencers at Daraz, described this new venture as an attempt to establish a creators’ ecosystem where the potential of social media marketing is optimized. The vision is to create a platform that brings together content creators and their viewers wherein viewers will be able to find easy links to any Daraz products used and endorsed by their preferred influencer. According to Daraz, their network of influencers currently crosses 1600 influencers across 20 cities in Pakistan. 

This is not the first time that Pakistan’s content creators have been at the forefront of a marketing scheme. Their success can be assessed by not only their huge online presence with millions of followers, but also by their involvement in mainstream media campaigns. But what makes affiliate programs so effective is that unlike celebrities selling you a product through an unrelatable TV advertisement, you now have an influencer/content creator who you can watch, use and review the product they are ultimately aiming to sell. It creates a semblance of genuineness and trust, making you likelier to want to try it out for yourself.

There is a growing trend of online content creators replacing celebrities to raise awareness for social causes or participating in political campaigns. The collaboration between Pakistani influencers and Daraz is also not a recent endeavor, with their engagements tracing back to early 2021 with Daraz’s live e-commerce partnerships. As explained by Ali Rizvi, the sheer impact of content creation became apparent to the company when Daraz was able to hit a tremendous milestone of earning $100,000 in a single day on their much celebrated 11:11 sale. This is what marked the beginning of what can potentially prove to be a genius marketing decision for Daraz, paving the path for more companies to follow. 

But what is Daraz doing differently?

It is no hidden secret that the current affiliate marketing schemes in Pakistan provide minimum transparency and control to the affiliates. This means that the collaboration of influencers with the brand and their viewers is restricted to them simply providing unique discount codes for the products they promote without any formal involvement in the impact that their work is garnering. 

The Influencer Hub, however, introduces a new fair practice of complete transparency by using a back hand automated process, similar to the YouTube creator studio, where the varying metrics of your content are available. The metrics in the Hub include providing insights into website traffic directed through the links and content published by the influencer as well as the amount of sales that traffic generated. 

Daraz’s sophisticated tracking system monitors all activities generated through the unique links influencers share to their social channels. Influencers can generate these links after they have signed up and onboarded on our influencer hub. This system allows the company to monitor several aspects, including what products were ordered, the value of each item, and the commission earned by the influencers. Additionally, Daraz provides a detailed dashboard to the influencers, offering day-to-day analytics about their earnings and insights into the products they sell through their social media platforms. This is a game changer because it means that content creators are finally able to perceive the impact of their work and ensure that the commissions they receive are in line with their contributions to a particular brand. As is imagined, this may in turn translate into increased motivation and a new form of legitimacy granted to Pakistan’s influencers as they pave the way to be recognized as entrepreneurs as well as social media stars. 

Yet, one of the caveats of such collaborations is the exploitation of an influencer’s fan- or viewership base, through ingenuine marketing of products not necessarily used by the influencer but only endorsed for marketing purposes or money. 

Profit asked Ali Rizvi whether influencers will be obligated to create promotional content for the company that is not necessarily reflective of their personal product preferences. Rizvi was honest with his remarks as he replied stating, “Our top-performing influencers are occasionally offered brand deals, but all other promotions, including advertising Daraz sales and paid product promotions, are open to all influencers in our network.” 

Additionally, another point of interest is that the commission offered to influencers by Daraz varies based on the product category they market. Which means that they can receive a commission of up to 10%, with higher rates for fashion and beauty categories and relatively lower rates for categories such as electronics. Yet, it is not the increased awareness of total traffic generated nor the opportunity to earn commissions that is the best feature of this new project, but rather that it provides a level playing field for all social media influencers across Pakistan. 

Since the criteria is simply based on: the amount of followers and the ability to influence, affiliate programs can be used as a tool for empowerment for women who create content or influencers based in smaller cities. This perhaps can help redefine business marketing practices as well as improve the independence of content creators. 

Moreover, Daraz is also set to benefit generously from this collaboration. Even currently, the company’s affiliate influencers play a crucial role in driving traffic to Daraz’s platform. They contribute around 5 to 10% of the total monthly traffic, a significant portion that adds value to the e-commerce ecosystem. More importantly, these influencers effectively generate sales by promoting products they use and trust, earning a commission based on the sales they generate. For Daraz, this provides transparency on ROI. This program is akin to the global affiliate programs seen with platforms like Amazon and Walmart.

While the increased utilization of social media platforms is indicative of a positive trend towards inclusivity and opportunity, there are some underlying precautions for affiliate marketing that content creators should take into consideration. Since companies essentially look towards optimizing an influencer’s brand or viewership loyalty it is imperative to ensure that the products promoted are not susceptible to price and quality volatility. Moreover, commission payout structures are essential to look into as exploitative players in the market may benefit from a lack of regulatory frameworks surrounding such schemes.

Conclusively, the introduction and openness to new performance-based marketing strategies can prove to be transformative to the market in multiple ways, with decreasing upfront costs of advertising and a shift away from traditional marketing mechanisms.