Forrester Consulting summarizes it best: “Affiliate marketing, once regarded more as a tool to drive consumers to the purchase event, is now viewed as a powerful channel for consumer discovery that leads to brand engagement and incremental sales at compelling ROIs.”
Predictions Indicate Affiliate Marketing Will Generate $6.8 Billion Between Now and 2020. Why Does Affiliate Work SO Well?
Low Risk, High Payoff
Affiliate marketing is a low-risk, high payoff marketing strategy that drives all aspects of a company’s reach and growth, including sales, client acquisition, and branding. It helps spread positive, consistent messaging across multiple ecommerce sites. It can also deliver coupons or other incentives to tap into new markets to further help expand reach and revenue.
Broad Reach, High Brand Visibility
Because online retailers are working with an array of publisher/affiliate partners (loyalty and cashback sites, coupon and offer sites, paid search arbitrage- increasing retailer’s paid search shelf space and blocking competitors- Influencers, bloggers, email and review sites to name a few), marketing efforts are leveraged across a broad network of ecommerce sites to reach previously untapped audiences. This generates high brand visibility and increases the likelihood of conversion.
Affiliate marketing partners might also help get merchants get ranked for highly desired, but extremely competitive, keywords. This visibility boost in organic search can drive additional traffic and sales.
Great Platform for New Online Retailers to Launch Their Product
Another plus: new online retailers can leverage affiliate partners to launch a product. With 42% of shoppers more likely to purchase from a brand after seeing an offer on an affiliate site – savvy merchants are strategically using affiliates in their sales funnel for new product revenue growth.
Access Previously Unavailable Data
Affiliate marketing generates data retailers might otherwise not see. For instance, sales referrals from an affiliate site can generate data about the latest trends and demands. This tells online merchants where to direct future marketing efforts so they can target content (and special offers) based on consumption demands.
Affiliate Shoppers Buy More than Non-Affiliate Shoppers
Research shows that affiliate shoppers buy in volume, oftentimes purchasing four times the amount regular online shoppers would. Further, affiliate shoppers are expected to spend an average of $506 more over a 12-month period than a non-affiliate shopper.
Affiliate Partners Excel at Marketing
And one final point: most affiliate partners are skilled marketing professionals themselves. They must be, the success of their own online business depends on it. Partner with the right ones for access to top-notch online marketing of your products and services that include social media, SEO, PPC, email campaigns, and more, with low risk to your business and a high ROI in return.
The Staggering Numbers Behind Affiliate Marketing
Affiliate marketing means cost-effective customer acquisition. According to Internet Retailer, “Word-of-mouth referrals, like those that come from third-party affiliate web sites, have a higher conversion rate than a brand’s own advertising, because consumers don’t see a third party as having the same bias as a retailer.” There is plenty of evidence to support this claim:
- 16% of all purchases online are from affiliate marketing
- 47% of shoppers agreed they are more likely to buy a product if it appears on multiple sites;
- 43% of shoppers indicate that seeing an offer on an affiliate site helped encourage them to buy;
- 47% of shoppers agreed that they have a positive feeling about a company when they see them represented on special deal and loyalty sites—because that makes them believe a brand is in touch with their needs and up to date.
How to Get Started with Affiliate Marketing
According to a recent survey, 90% of merchants said that affiliate programs were important or very important to their overall marketing strategy. However, 78% of merchants say affiliate marketing is their least mastered area of marketing. The good news is that there are some steps online retailers can take to ensure affiliate marketing efforts met business objectives. These steps include:
Get Your Messaging Down for ALL Audiences
A properly managed affiliate marketing program should generate between 10 – 15% of online direct-to-consumer ecommerce revenue. Success means properly addressing messaging to affiliates while also creating compelling customer offers for these affiliates to leverage.
Broadly defined, messaging includes:
- Regular communication with affiliate partners via newsletters and affiliate resource pages to help build and grow the relationship
- Compelling content and offers for consumers
- Language and other guidelines to help partners stay on target with the brand message
Plan for the Tasks at Hand
Significant time and resources are required to ensure the success of an affiliate marketing program. Key areas include:
- Day-to-day management of the affiliate marketing program;
- A means of tracking compliance by partners;
- Developing a strategy to maximize affiliate channels;
- Affiliate network selection;
- Affiliate payout structure and payment management;
- Recruiting the right partners;
- Identifying better or more productive partners;
- Focusing on creating content and offers that are fresh, current and compelling;
- Establishing metrics for the program, then testing and measuring those on a regular basis;
- A robust system for accounting and reporting results.
- Continually build relationships with affiliate partners via regular, clear and thorough communications, keep up to date in changes and innovations in the affiliate marketing industry and attending conferences!
eAccountable is a digital agency specializing in online retailer representation and provides tools and services such as affiliate marketing for many of the Internet Retailer Top 500 merchants. Well-recognized online brands include: Waterford, Peter Millar, CafePress, Beretta USA, Fleet Feet Stores, Performance Bike, RockbottomGolf.com, Katom.com, CanvasOnDemand.com, GreatBigCanvas.com and more.
If you would like more information about affiliate marketing sign up for an Accountable Big 3 Ideas Analysis – a one-on-one consultation with one of our digital consultants where you leave with three big ideas to grow your business now!
By Ryan Fitzgerald