At-Home Health Tests Brand Cuts Acquisition Costs and Exceeds 10x ROAS Goal Through Affiliate Optimization

Outcomes

Objective

A leading innovator in precision health solutions partnered with Perform^[cb]’s affiliate management team to drive profitable growth while addressing rising acquisition costs. The client set ambitious goals to:

• – Achieve positive ROI per transaction
• – Lower customer acquisition cost (CAC)
• – Increase return on ad spend (ROAS) to a target of 10x

Key challenges included:

• – High commission payouts combined with discount offers were causing a loss of over $80 per order.
• – Overpaying commissions relative to profit margins threatened long-term program sustainability.
• – Concern about cannibalization of organic and direct traffic due to partner TM+ and long-tail keyword bidding inflating costs.

Approach

Perform[cb] designed and executed a multi-faceted strategy focused on restoring profitability and optimizing partner value:

– Data-Driven Analysis: Conducted competitive benchmarking to determine appropriate CPA rates, and modeled best-case/worst-case commission scenarios to guide the marketer’s decisions.

– Commission Restructuring: Decreased existing commission rates across the board, adjusting payouts based on partner type and contribution to profitability. Net-new partners received even lower default commissions to protect margin.

– Partner Mix Optimization: Evaluated and removed partner offers with excessive coupon code usage (over 3,000+ codes) and transitioned to a non-promotional model designed to lift average order value (AOV).

– Targeted Promotions: Established tightly controlled coupon codes, available only to select partners who demonstrated strong profitability, ensuring alignment with their cost and ROI goals.

– Traffic Quality Protection: Strategically scaled back TM+ and long-tail keyword bidding permissions, curbing the risk of cannibalizing the marketer’s organic and direct sales channels.

Results

Through Perform^[cb]’s strategic program restructuring and partner optimization:

• – The health marketer’s affiliate program became profitable on a per-order basis, reversing prior losses.

• – ROAS surged from 3.53x to 10.70x, exceeding the marketer’s ambitious 10x target.

• – New customer orders increased by 78.26%, demonstrating the program’s enhanced ability to acquire high-quality customers.

• – The partner mix diversified significantly, reducing dependency on the top 10 affiliates and adding new revenue-generating partners that contributed to a healthier, scalable ecosystem.

This refined approach not only mitigated cost concerns but also helped the marketer recoup revenue that had previously been lost as certain partners scaled back efforts when bidding permissions were reduced.

Ready to drive profitable growth for your brand?

Connect with Perform^[cb]’s affiliate management team to learn how we can optimize your affiliate strategy, enhance ROI, and build a sustainable program that aligns with your business goals.