The Pulse of Affiliate Marketing Remains Strong
Despite what you might have heard, the heartbeat of affiliate marketing remains strong and healthy in the current eCommerce environment. Less reputable approaches to this business may have created a stain on the industry a decade ago, but the quality of programs and connections between merchants and affiliates today is much stronger. Both partners understand the need to offer a quality customer experience to go along with great solutions for customers.
The following is an overview of factors that contribute to the current strength of affiliate marketing, with insights on how you can succeed in this vibrant eCommerce arena.
Money talks
Nothing offers more tangible evidence of industry strength than economic impact. Currently, affiliate marketing generates more than $5 billion annually. However, more importantly, this number is expected to grow at a 10.1% clip through 2020, according to a recent survey by affiliate network Rakuten. This pace would result in an industry worth $6.8 billion by that point.
This growth projection indicates the relative strength of the industry but also suggests there is still room for new affiliate entrants. If you are well-established, you could also seize the opportunity to grow by attracting new customers and venturing into new product categories.
Marketers love them
In addition to the money generated from consumers, the way marketers spend their advertising budgets offers perspective on the strength of the affiliate pulse as well. Rakuten indicated that 90% of marketers stated that affiliate marketing was critical to their current and forward-looking plans. Some of these firms operate their own direct programs, but many connect with partners through third-party platforms like Rakuten.
Currently, 80% of marketers surveyed reported that their companies facilitated some type of affiliate marketing program. Eighty percent of respondents also said that at least 10% of their company’s marketing spend was dedicated to affiliate programs.
This data shows that companies are finding success promoting goods and services through affiliates, and believe they will continue to do so in the near future. For marketers, affiliates offer an extra outlet to connect with consumers, broadening brand reach beyond what the company is capable of achieving on its own.
Ecommerce is growing
The digital realm continues to grow in importance among the consumer marketplace. A recent survey showed that 96% of all U.S. Internet users have made a purchase online at some point. A growing consumer marketplace buying online and the increased investment in affiliate programs point to a winning combination driving economic opportunity.
Today’s consumers also begin a lot of their buying activity online through a search engine like Google. For this reason, even new or small affiliates can compete for customers through organic search optimization and paid advertising. This semi-level playing field is distinct from what you typically experience as a small company trying to compete with bigger players in the brick-and-mortar marketplace.
The convenience of researching and purchasing many products online and having them delivered to consumers’ homes is a major reason that eCommerce activity continues to climb.
More networks abound
In many ways, the growth of affiliate marketing is aligned with the increase in networks that connect merchants with affiliates. While some firms do offer direct access, a network that connects affiliates with hundreds or thousands of merchants in one place amplifies the volume of products promoted much more quickly.
Merchants and publishers value networks. Eighty-three percent of advertisers surveyed by Rakuten rely on network dashboards to recruit new affiliates. Affiliates can join up with merchants that offer open access to products and services, or request to join up with companies that are more selective as to the types of partners that can promote their goods.
Journey influence is thorough
As is the case in other industries engaged in digital marketing, affiliate marketing is now used to influence all stages of the typical buyer journey. The Rakuten survey showed equal effort across the journey, with 83 percent of marketers targeting consumers during the initial awareness stage, and 79 percent targeting them during both the purchase and post-purchase stages.
The latter data point shows that affiliates realize that optimized long-term profits are based on their ability to retain customers after purchase. For this reason, affiliates place more emphasis on a quality website, excellent user experience, and ongoing marketing communication.
Bountiful access to advertising
Affiliates need to promote their businesses as well, and the digital landscape provides plenty of access to affordable and effective communication. Affiliates can engage their large consumer audience through social media. Establishing a brand presence on social media creates a natural gateway to your website. As you pinpoint your ideal customer profiles, leverage the opportunities available through top social networks to target precise customers through highly targeted advertising.
Display and search ad options are efficient as well. You can engage in retargeting campaigns that allow you to re-engage people who visit your website and then exit without a purchase. Deliver relevant digital ads and emails that present these buyers with a reminder of the benefits of the evaluated solution. Google AdWords offers a large network of publishers and search advertising options that allow you to target your ideal customers and control your advertising spend. Access to thorough campaign data enables you to evaluate the return on investment and modify strategies accordingly.
Email has become an important tool for engaging with established customers. By capturing email data from a first-time buyer, you can share useful information and resources and offer customized product recommendations based on previous purchases. Email marketing presents the highest return on investment in the digital arena for typical businesses, making it especially viable for affiliates on a tight budget.
Conclusion
This collection of data and insights on the current state of the industry shows that affiliate marketers can thrive in the coming years. Aligning your own digital strategies with those consistent across other eCommerce sectors is necessary for competitive success. Take advantage of the increased access to quality merchants and products through the escalation of opportunities to connect through reputable networks.