An affiliate programme pays outside publishers (review sites, cashback and voucher sites, newsletters, creators) a commission when a customer they send to your shop buys. A referral programme rewards your existing customers for introducing friends. I set up and manage both for UK online retailers and subscription businesses: the commission or reward structure, the tracking, the partner terms, the compliance and the monthly checks that stop you paying for sales you would have made anyway.
What changes when a programme is run properly
- You pay for customers a partner actually found. Validation rules, a policy on voucher codes and clear brand-bidding terms stop commission going to sites that only touched the sale in its final seconds.
- Commission follows your margin, not a network default. Rates are worked out from what a new customer is worth to you, so a partner who brings repeat buyers can earn more than one who brings one-off bargain hunters.
- Partner content stays within UK advertising rules. Every affiliate knows how to label their content as an ad, and you hold a record of what you told them.
- Referral rewards reach people who will buy again. The reward, the moment you ask and the wording are designed around your customers, not copied from a software template.
Affiliate and referral programmes are different jobs
Both pay only for a result, which is why they are often sold as one service. In practice they are run differently, and the risks sit in different places.
| Affiliate programme | Referral programme | |
|---|---|---|
| Who promotes you | Publishers with their own audience | Your existing customers |
| Usual reward | Cash commission on each validated sale | Credit, a discount or a gift, often for both people |
| Where it runs | An affiliate network or tracking platform | Your checkout, account area and post-purchase emails |
| Main risk | Paying for sales you would have had anyway | A reward too small to act on, or contact rules broken |
Which comes first depends on what you sell. A shop in a category that review and comparison sites already cover, with margins that can carry a commission, usually has publishers ready to promote it. A subscription business, or one whose customers already recommend it by word of mouth, tends to get more from a referral scheme first, because the people doing the recommending already trust the brand. Some businesses need both, but few need both on the first day.
Who this suits, and who it does not
This work suits UK online retailers, direct-to-consumer brands and subscription businesses that already sell steadily online, know their margins and returns rate, and can record each order reliably. Partners will only promote a shop that converts the visitors they send, so a working store matters more than a large budget.
It is the wrong starting point in a few situations:
- Your sales tracking is unreliable. Commission depends on every order being recorded once and only once, so checking your conversion tracking works comes first.
- You want paid posts from creators. That is influencer marketing, which is briefed and paid differently, even though some creators also take affiliate links.
- You are not sure which channels deserve your budget. A written digital marketing strategy with a budget split will tell you whether partners belong in the plan at all.
What the work covers
Commission and reward structure
I start from your contribution margin and how often customers come back, then set commission rates by product group or customer type. New customers can earn a higher rate than returning ones, and low-margin lines can be excluded. For referrals I decide who gets rewarded, with what, and when the reward is released.
Network or platform choice
UK affiliate programmes usually run through a network or partnership platform such as Awin, Partnerize or impact.com, each with its own fee model and publisher base. Referral schemes run on dedicated software or your ecommerce platform’s own tools. I compare the options against your order volume and the publishers you want to reach before you sign anything.
Tracking and consent
Affiliate tracking is advertising tracking, so under PECR it sits behind your cookie banner like any other non-essential cookie. I set it up so it fires only with consent, test it with real orders, and make sure refunds and cancellations flow back to the network. Server-to-server tracking can reduce data loss, but it still needs a lawful basis and a mention in your privacy notice; it is not a way round consent.
Partner terms and recruitment
The terms set out what partners may and may not do: whether they can bid on your brand name in search ads, which discount codes they may publish, how long a sale stays open to cancellation, and how content must be labelled. I then approach publishers who reach your customers, rather than accepting every application.
UK advertising and consumer law
Affiliate content is advertising. The CAP Code requires marketing to be obviously identifiable as such, and the Advertising Standards Authority can hold the brand responsible for an affiliate’s unlabelled post as well as the affiliate. Paying for editorial coverage without making that clear is also a banned practice under the Digital Markets, Competition and Consumers Act 2024. Every partner gets a short written brief on labelling, and I spot-check what they publish.
Monthly management
Each month I validate or decline pending sales, review which partners bring new customers and which mostly take credit for existing ones, answer partner questions and adjust commission where the numbers say so.
How I run a programme
- Numbers first. We go through margins, returns, average order value, repeat purchase rate and what a customer costs you from other channels. The LTV and CAC calculator is a quick way to bring those figures together beforehand.
- Design. I write the commission or reward structure, the partner terms and the labelling brief, and agree them with you.
- Build and test. Tracking goes in, consent is checked, and test orders confirm each sale is recorded once, with the right value.
- Soft launch. Affiliates start with a small group of well-matched publishers; referrals start with recent customers who left good feedback.
- Run and review. Monthly validation and reporting, with a fuller review each quarter of whether the programme is adding customers or relabelling ones you already had.
Problems I see most often on UK programmes
- Voucher sites winning the last click. A customer at the checkout searches for a code, lands on a voucher site and the commission goes there. Under last-click attribution that looks like a sale the partner made.
- Affiliates bidding on your brand name. They pay for clicks on searches you would have won for free, then take commission on the order.
- Commission paid on returned orders. The validation window closes before the cancellation and return period under the Consumer Contracts Regulations 2013 has run its course.
- Refer-a-friend emails sent by the business. When your system emails a friend’s address that a customer typed in, the ICO treats you as the sender of that marketing, and the friend never agreed to hear from you.
- Tracking that fires before consent. The tag was pasted into the theme years ago and ignores the cookie banner entirely.
What you receive
- A programme plan with commission or reward rates and the reasoning behind each one.
- Written partner terms and a one-page labelling brief for affiliates.
- A tracking record: what fires, when, with which consent, and the test orders that proved it.
- A monthly report showing sales, commission paid, sales declined and why, and the cost of each new customer next to your other channels.
If you run paid search and social ads alongside the programme, I can report all of them against one cost per customer through performance marketing, so affiliates and ads are not both claiming the same order.
Next step
Send me your product range, rough margins and how customers currently find you, and I will tell you whether an affiliate programme, a referral scheme or neither is the better use of your money. Book a consultation to talk it through.