#1 Self Regulation: Big Hat, No Cattle

There’s going to be lots of talk about how the industry needs to come together and self regulate in order to avoid more stringent government oversight. In fact, we at Revenue Performance will be shouting from the rooftops along with everyone else to try and encourage this. But the truth is that nothing is really going to work until and unless the incentive for networks to turn a blind eye to dodgy traffic goes away. If it pays some networks to take volume over quality – and it often does – then the bad actors will never be driven out of the industry and the idea of self regulation will remain as effective as it is in the banking industry, i.e. not effective at all. We hope we’re wrong about this prediction, but we don’t think we are.

#2 Mobile Pie And Lots Of It!

Everybody knows mobile is going to go crazy this coming year and it is becoming clear that it is going to end up dominated by the big boys. Google, Apple and Groupon (if they can keep up the insane pace of growth they have been on for the last six months) will take 90% of the pie. They have technology or first-mover advantages that are too great for any other company to make a dent in them during the next twelve months. The good news for affiliates and networks is that the remaining 10% of what is a reeeeelly big pie is still a lot of pie.

#3 Display And CPA Both Grow

Better analytics is going to mean that more and more advertisers become comfortable with using media buys for volume traffic. Real-time bidding and improved demographic data availability will allow display networks to aggressively go after performance marketing dollars. At the same time, CPS and CPA will go from strength to strength as efficiency and scalability improves through better network technology.

#4 Internationalization Revs Up

The profitable affiliate marketing niches in America are saturated. Growth is going to come from overseas. Europe is hot because it’s pretty easy to set up an office there and there is all the support infrastructure of an advanced Western economy. But the Big Kahunas are China and Brazil: both growing like crazy and both with a language barrier more difficult than French, German or Spanish. Local partners will be able to negotiate good deals as competition intensifies.

#5 Good Publishers Get Stronger

We have already seen a move to good publishers being able to demand upfront CPA payments. That trend will continue for high-volume publishers with quality traffic. they’re going to be able to negotiate exclusive deals with networks, providing more security of income to both sides of the deal.

#6 Bloody Coupons

Groupon = a zillion coupon sites. Gah.

#7 Networks Differentiate Or Die!

With a multitude of networks already fighting for survival and a new wave of mobile startups joining in, there has to be consolidation in 2011. The ones that survive will be those that can add more value than their competitors. That means investing in their own platform or stand out from the crowd by virtue of extraordinary execution within a particular niche or vertical.

#8 Acquisitions And Flameouts

The growth of local and performance marketing offers on mobile means we’re going to see even more new mobile networks starting up. But the pace of change is accelerating and nobody can afford to be left behind. Look for acquisitions in the mobile network space during 2011, followed by flameouts and failures of the networks that get left on the shelf.

#9 Apple Takes Over The World

Forecasts for future iPad sales are uniformly astonishing but the consensus seems to be that in 2011 Apple will sell 50 million iPads – up from 10 million in 2010. Let’s assume they only double that in 2012 to 100 million units. Right now, Apple is selling around 30 million apps a day. Scale that up at the same rate as the iPad and they should sell 300 million a day in 2012. Allow for a 30% gross margin (the iPad currently provides about 36% but that will drop as more competitors enter the tablet marketplace) and that equates to some $28 billion of gross profit, just from iPad-related stuff. Add in the iPhone growth when it goes on the Verizon network, Mac and iPod products, and music and movie sales through iTunes and you’re looking at $50-60 billion in gross profits in 2012 without breaking a sweat. Do you see now why we think Apple might yet buy another network or two?

And the #10 prediction from Revenue Performance’s crack team of futurologists:

#10 Social Will Be Big

But you knew that already, right? Right?!?