Trends Affecting Affiliate Marketing
Kleiner Perkins partner Mary Meeker is famous for producing her huge “Internet Trends Report.” She just released her 2016 report, covering everything from smartphone adoption to video viewership, and from the startup funding climate to Chinese Internet companies. View the actual report here, and scroll down to read our four biggest takeaways for the affiliate marketing industry.
1. We Need To Crack Mobile Conversions
US online advertising has been increasing by about 20% year-on-year since 2011 and that growth may be accelerating with the shift to online video. Google and Facebook between them are now taking 76% of those advertising receipts. Facebook’s ad sales are up 59% YoY. In some ways media buying is becoming easier, with over 3/4 of money being spent within just two platforms. Yet for all that, while 25% of total time spent on media is on mobile, only 12% of ad spend is in that channel. Mobile is hugely under-advertised. As affiliates know though, mobile traffic is hard to convert. I’ve seen some imaginative new sales flows being tested over the last few months. A prediction: the first company to really crack mobile conversions will make a fortune.
#2. Smartphone Adoption Is Slowing
Global smartphone shipments are growing at 10% a year, down from nearly 30% not too long ago. Android is still increasing market share even in the slowing market: up 7% year-on-year. iOS is down 11% market share globally and has also seen a 9% drop in average unit selling price. Not a good year for Apple overall. The report is also clear that smartphone user acquisition is emerging economies is going to much slower from here on due to the high price of hardware compared to income levels. The point is that mobile has passed its initial rush of expansion. From here on, growth will depend on being smarter than the competition. Just turning up on mobile won’t be enough.
#3. Video Is Exploding But Is Often Ineffective
Snapchat and Facebook Live are growing like crazy, YouTube is still attracting huge audiences and yet 81% of people mute video ads. 62% are put off by pre-roll ads. And 93% consider using ad-blockers.
This kind of misalignment between media and its consumers means there’s a big opportunity for disruption. Entertaining, camera-based story-telling, genuinely native to the relevant platform, and customized, optimized sales funnels are the way forward.
#4. Image-Based Platforms Are Ready To Break Out
Pinterest started allowing affiliate links again just a few weeks ago. Want to know why? Look at the growth figures for OfferUp, the latestv image-based product search/commerce platform. Millenials and Gen Z consumers communicate via image, much more than we oldsters (anyone over 30). Again, big opportunities here for people who can crack the code.