Welcome to the second part of our insightful journey with Thomas McMahon, a champion in the affiliate marketing world.
In this continuation, we delve deeper into the evolving trends of direct response and affiliate marketing, uncovering strategies that drive success in this dynamic industry.
We will explore Thomas McMahon’s perspectives on the future of marketing, how businesses can continually optimize their affiliate offers, and understand the nuances of commission strategies that lead to success.
Additionally, we’ll gain insight into his personal growth story influenced by his experience at ClickBank.
Let’s learn more about these compelling aspects of affiliate marketing, guided by our today’s champion in performance marketing: Thomas McMahon.
Q: Based on your experience, what current trends shape the direct response market, and how are brands adapting to these changes? What verticals are popular?
Thomas: In recent years, the affiliate marketing and direct response sectors, particularly within ClickBank, have significantly shifted from digital offers towards supplement offers. This trend involves selling supplements in varying quantities, focusing on maximizing average order value (AOV). Surprisingly, the AOV has continued rising, even beyond expectations, with affiliates earning substantial sales commissions.
This shift has transformed ClickBank’s marketplace, making supplements one of the top verticals. However, it’s important to note that digital offers haven’t disappeared; they’ve continued to grow year after year. It’s just that the physical supplement sector has grown so much that it now dominates a larger share of the market. In the health space, weight loss, blood sugar, hair, and dental are particularly booming verticals, with dental experiencing a significant surge in the last 18 months.
The shift towards supplement offers in the affiliate market has been significant, with an emphasis on maximizing average order value and diversifying affiliate strategies for long-term success.”
One trend I foresee is a shift in affiliate strategy.
Rather than always aiming for the maximum CPA (cost per acquisition) from supplement sellers, successful affiliates will understand the value of diversification and long-term consistency. They’ll focus on maximizing cost per click or revenue per visitor rather than just the highest commission per sale. Affiliates maintaining steady, significant daily traffic over the years will outperform those scaling rapidly but unsustainably.
Furthermore, we’re seeing more partnerships and collaborations, with sellers and affiliates teaming up to launch their offers. This approach allows for a more controlled scaling process instead of relying on multiple external media buyers. Adding email affiliates into the mix further enhances this strategy.
Q: As we look toward the future, what are your predictions for the next big trends in direct response and affiliate marketing?

Thomas: Looking ahead, artificial intelligence (AI) is undoubtedly setting the stage for major changes in direct response and affiliate marketing.
AI is lowering barriers to entry, enabling new marketers to quickly set up blogs, create ad creatives, and launch businesses more efficiently and cost-effectively than ever. However, this ease of entry also means increased competition.
Top creatives and successful campaigns will be replicated and improved unprecedentedly. This environment will place a premium on the ability to craft truly exceptional copy and ad campaigns while utilizing AI to maintain a high speed to market.
Another significant trend is the move towards personalized customer experiences. We’re starting to see the development of customized sales pages tailored to individual users, including personalized video content. This level of customization is likely to become more prevalent and could redefine user engagement and conversion strategies.
Additionally, the “hybrid” business model concept is gaining traction. With rising customer acquisition costs, e-commerce brands are adopting more direct response tactics, integrating performance-based strategies into their marketing mix.
Performance marketers are increasingly adopting branding elements into their campaigns, focusing on creating a more positive and less aggressive user experience. This shift is partly driven by major platforms like TikTok, YouTube, Facebook, and Google, which are tightening compliance and standards to enhance user experience.
In the future, the most successful brands will likely be those that can effectively combine direct response campaigns for cold traffic acquisition with more branded approaches, including organic content marketing and creator campaigns.
This dual approach will cater to both aspects of the consumer funnel: acquiring new customers and retargeting for deeper engagement.
Q: What strategies do you recommend for businesses to continually optimize their affiliate offers for better performance and higher commissions?

Thomas: For businesses looking to optimize their affiliate offers, the key is to strike a balance between various performance metrics.
It’s not just about focusing on conversions or striving for higher commissions.
A more holistic approach involves looking at the equation:
Conversions x Average Order Value = Revenue Per Visitor (RPV)
By maximizing RPV and, ideally, Profit Per Visitor (PPV), you can align this with a customer’s Lifetime Value (LTV), based on the acquisition channel.
This approach allows for more effective split testing and maximizes customer acquisition efficiency, whether adjusting affiliate commissions or comparing performance against other marketing channels like Facebook Ads.
Moreover, offer owners should not solely depend on affiliates for traffic generation.
It’s crucial to have your own ad-buying strategies, either in-house or through an agency, particularly for acquiring cold traffic from day zero. This approach is not merely about diversifying traffic sources; it provides valuable data that you control and can analyze more swiftly than making assumptions based on affiliate-driven traffic.
Understanding the affiliate mindset becomes easier, and you can directly share successful strategies, leading to a more synergistic relationship between your own marketing efforts and those of your affiliates.
Q: From your experience, what are some of the most successful commission strategies you’ve seen in affiliate marketing?

Thomas: In affiliate marketing, the simplest yet most effective commission strategy is the ability to pay the most for customer acquisition.
Often, brands overcomplicate their commission structures, but it essentially boils down to this basic principle: if your offer is strong, paying affiliates a higher commission and paying them quickly can significantly boost your success. This approach hinges on closely monitoring your data and maximizing the customer’s lifetime value (LTV).
For example, you might think offering affiliates a 25% commission upfront, followed by 10% for every recurring bill, is attractive. However, if your competitor offers a 70% commission upfront, they are more likely to attract affiliates, even if your long-term payout might be higher. The key is understanding and responding to the market dynamics and what your competitors are offering.
If you find yourself unable to match your competitors’ commission rates, it’s important to ask why. How are they able to offer higher commissions? Is it because of a higher average order value (AOV) or a better LTV?
Identifying what you’re lacking – whether it’s certain systems, strategies, or personnel – is crucial to closing this gap. The economics of your offer must make sense and be competitive in the market.
Q: Finally, how has your experience at ClickBank influenced your personal growth as a marketer and a business development professional?
Thomas: My time at ClickBank has been instrumental in my personal and professional development. Over the past eight years, it has allowed me to grow in every aspect of my life.
The management team at ClickBank set ambitious goals for me but allowed flexibility in achieving them, which has been crucial for my development.
Before ClickBank, I had some experience with public speaking, but working for a leading brand in the affiliate marketing space accelerated my exposure to larger audiences and more prestigious platforms. Initially, I experienced nervousness about speaking, recording podcasts, or appearing on camera. Over time, this nervousness has transformed into a drive to excel and deliver value to my audience.
A key lesson I’ve learned at ClickBank, particularly from leaders like Dominick Keenan, is the importance of adding value first and foremost.
At ClickBank, I’ve learned the importance of adding value first, which has shaped my approach to marketing and business development
This principle is deeply ingrained in ClickBank’s business model. We succeed only when our clients do, as ClickBank earns when transactions occur. This approach ensures that my interactions, whether through speaking engagements, sales calls, podcasts, or social media, are always centered around educating and assisting others. If there’s a genuine connection and mutual recognition of potential, it paves the way for successful business relationships.
We sure understand this approach very well as at CPV One we grow by helping others as well!
Q: If you would start a new business to help the affiliate marketing industry, what problem would you like to solve?

Thomas: If I were to start a new business to support the affiliate marketing industry, my focus wouldn’t be on launching offers or becoming a supplement seller or a direct-to-consumer brand. Instead, I’d concentrate on serving the clients I’m already familiar with – the entrepreneurs, offer owners, and affiliates – essentially, the B2B aspect of the industry.
There’s an abundance of different software solutions out there, but my strengths don’t lie in tech creation. My interest leans more towards the community aspect, particularly how to facilitate meaningful connections within the industry.
The goal would be to help the right people connect at the right time to solve the right problems. This might manifest in a business model centered around group consulting and coaching, especially for high-level, action-oriented entrepreneurs who are ready to drive significant business changes.
I’ve observed that many entrepreneurs excel in one area but often reach a plateau because they’re unsure of which levers to pull next for scaling. It’s usually not about pulling all available levers but identifying and utilizing the right one at the right time. The real fulfillment comes from helping someone recognize and leverage their unique growth lever.
Often, the challenge isn’t necessarily about needing more traffic or affiliates; it’s about addressing core issues within the business. It could be that the offer itself needs refinement, or there’s a need for better SOPs and team alignment. By focusing on these foundational aspects of the business, the more visible elements like marketing and sales naturally improve.
So, in essence, the business I envision would assist entrepreneurs in tackling the less glamorous yet crucial, parts of their business. This approach would enable them to scale more effectively, quickly, and stably – that’s the essence of happy scaling.
To sum up…
And this is the end of the second part of the interview with Thomas McMahon. The man is full of knowledge, let me tell you that, and easily we could write a book after a discussion with him.
If you didn’t manage to read the first part of the interview with Thomas, check it out here.
I loved his idea of a new business to match the people with the right solutions at the right time. This approach underlines the importance of holistic business development, beyond just traffic generation and surface-level strategies.
We hope you got your piece of learning from his extensive experience.
But, if I would do a summary it would be this:
- with passion and curiosity you can grow a lot in affiliate marketing
- compliance standards in affiliate marketing is dictated by major traffic sources like Facebook, Google and the like.
- success in affiliate marketing starts with being a good marketer.
- an affiliate program should be viewed primarily as a customer acquisition channel, not a direct profit center.
- track your marketing and always keep an eye on your performance metrics.
- learn from other success stories from affiliates out there, read case studies, check communities and do things better.
- split test for each traffic source.
Thomas McMahon is accessible through multiple platforms, offering various ways to connect and engage with his content and insights.
Whether through social media, personal websites, email, or his podcast, he provides valuable resources and information for those interested in the affiliate and direct response marketing spaces. This level of accessibility and knowledge sharing exemplifies the collaborative and open nature of the affiliate marketing community.
You can find Thomas on:
- Linkedin: https://www.linkedin.com/in/thomasmcmahon1855/
- Instagram and TikTok @happyscaling
- Facebook: https://www.facebook.com/thomas.mcmahon.94695/
- Can listen to me at the Affiliated Podcast with Kyle Kostechka and our amazing lineup of guests: https://www.clickbank.com/affiliate-marketing-podcast/
- Emails: thomas[at]clickbank.com and contact[at]happyscaling.co

Author: Julia Draghici
Julia is the CEO of CPV Lab and CPV One ad trackers. She has 15+ years experience in the software industry, from development to management. For more than 6 years she is helping marketers get the best out of their marketing campaigns by using a performant ad tracker. Passionate about entrepreneurship, business and performance marketing, Julia loves helping people!