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So What's Next for Affiliate Marketing?

August 11, 2014 by Melissa Feemster

WhatsNextAffiliate marketing just celebrated its 20th birthday and – wow – has it changed! Just look at the last few years. New and different affiliate models continue to appear, the world is getting smaller through the international reach of publishers, and the customer journey and experience have become ever so scrutinized. This is coupled with the consumer shift in consumption — where smartphone devices and tablets are on par with brick and mortar shopping. So what’s next in affiliate marketing? With innovation happening at the speed of light, it’s hard to tell, but here’s what I project.

 1.  Affiliate models will continue to morph

What was considered an affiliate 20 years ago looks nothing like it does now. From a lonely link on a page that fought its way to get noticed, to today’s popular social commerce sites, coupon sites and loyalty programs, affiliate marketing will see further innovation, complexity and opportunity. This will be driven, in part, by new entrants into the space, which are being fueled by venture capitalists. For instance, social commerce newbie Wanelo brings together stores and products into a single social platform. By reorganizing shopping around people, consumers use Wanelo to follow their favorite stores, share products and organize all of their shopping. There will be more of these as Booz & Co. estimates the social commerce segment will continue at a rapid pace and reach $30 billion by the year 2015.

 2. International borders are disappearing

You’ve likely seen news from various performance marketing networks about overseas expansion. This makes sense when you consider that eMarketer estimates that global e-commerce sales will have exceeded 1.2 trillion in 2013.  As online retailers enter new markets, many will continue to look to the affiliate channel to support their efforts. The pay-for-performance model allows them to access local knowledge and talent to test the waters before making significant capital investments in a new region. As markets such as India and China boom in terms of mobile users, Forrester notes “These markets give [brands] the opportunity to test out new campaigns and tactics on a larger scale with fewer enterprise technology hurdles, allowing [them] to quickly learn and iterate”. Even retailers who cannot translate sites and currency have the opportunity to reach international markets via the affiliate channel, by leveraging the publisher’s unique audience to presell and educate in the native language.  Dealmoon is a great example of a site who can help retailers reach a Chinese audience who are most comfortable shopping in their native language, but who are bilingual and used to making a final conversion on a retailer’s US site.

 3. Cross device and omni-channel retailing

It’s more important than ever for publishers and retailers to have a cross device and omni-channel strategy so they can be everywhere in the consumer path to purchase. In a cross-channel world consumers are increasing the number of channels they use as evident by an Oracle white paper that showed one-third of consumers reported used two or more channels to research and complete a transaction. Affiliate sites — fashion sites, blogs, loyalty sites and coupon sites — are a key stop on the path to purchase. Online shoppers who frequently use the affiliate channel are four times more likely than average buyers to try a new brand after receiving an offer, and typically spend more than average online shoppers. Additionally, credit card information is stored across devices, making ‘buy now’ easier than ever. This unstoppable trend is something brands need to take advantage of or else risk losing consumers along the journey.

 4. Mapping the consumer experience

With omni-channel marketing tactics in full play, the key to better ROI and high-definition consumer profiles is to track engagement and transactions across the different channels and analyze the data throughout the journey. Knowing this improves the consumer experience and leads to better return for both retailers and publishers. This so-called big data approach helps publishers and advertisers create engaging and relevant content, and can give a birds-eye view of the path to conversion. Advertisers are starting to invest in attribution measurement models which publishers should understand and embrace. It’s a good thing, because there will be more transparency on both sides into what drives consumer sales.

 Change is happening in real time and both advertisers and publishers need to be nimble, watch for trends and reset based on current matters. Collectively, we’ve come a long way in 20 years and as technology evolves and consumers continue to have a voracious appetite for information, publisher models will need to evolve to accommodate.

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Filed Under: Columnists, eCommerce, Marketing 2.0, Revenue Tagged With: affiliate marketing, ecommerce, Industry Trends

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