Bottom-Line ROI – Support from Affiliate Marketing

Today’s affil­i­ate space is throw­ing up some impres­sive fig­ures. A recent UK mar­ket study by the IAB and PwC show­cased the affil­i­ate and lead gen­er­a­tion mar­ket as a £14 bil­lion rev­enue gen­er­a­tor – one that paid out over a bil­lion pounds in com­mis­sions...

Chris Johnson By Chris Johnson from PerformanceIN. Join the discussion » 0 comments

Today’s affil­i­ate space is throw­ing up some impres­sive fig­ures. A recent UK mar­ket study by the IAB and PwC show­cased the affil­i­ate and lead gen­er­a­tion mar­ket as a £14 bil­lion rev­enue gen­er­a­tor – one that paid out over a bil­lion pounds in com­mis­sions and expen­di­ture to affil­i­ates. For­rester is also pre­dict­ing that by 2016, the com­mis­sion and expen­di­ture fig­ure in the U.S. is like­ly to be poised around the $4 bil­lion mark.

In short, the “paid on per­for­mance” mod­el is being well received by the peo­ple it serves, and things are only about to get big­ger.

The Global Ascension Of Affiliate Marketing

The Euro­zone affil­i­ate scene is also bub­bling away nice­ly. Emerg­ing east­ern Euro­pean mar­kets are ben­e­fit­ting from wider Inter­net pen­e­tra­tion and infra­struc­ture along­side a desire from exter­nal busi­ness­es to expand into these areas. APAC is anoth­er pic­ture of pos­i­tiv­i­ty, exem­pli­fied by a host of com­pa­nies recent­ly launch­ing into the Aus­tralian mar­ket. There is also a fast-grow­ing LATAM region, ral­lied by an impres­sive mobile inter­net boom and exper­tise from over­seas.

There’s no need to go on about its glob­al rise, but the main ques­tion we’re often asked is about the true USPs when engag­ing with the affil­i­ate mar­ket. Ulti­mate­ly, the true USPs for brands engag­ing with affil­i­ate mar­ket­ing derive from the low-risk and lucra­tive oppor­tu­ni­ty that it presents.

Few­er over­heads and big gains to any brand’s bot­tom line can be seen from the OPM study and £14:£1 ROI that affil­i­ate and lead gen­er­a­tion dri­ves. That’s a £14 pound return on every £1 pound spent in the chan­nel. What oth­er indus­tries can attribute such pos­i­tive and mea­sur­able return on invest­ment?

While the UK mar­ket can ben­e­fit from being tight-knit, Lon­don-cen­tric (thus enabling eas­i­er self-reg­u­la­tion), and close to oth­er dig­i­tal indus­tries, oth­er geo­graph­i­cal loca­tions are hav­ing to look at how they can shape their more expan­sive mar­kets to con­tin­ue encour­ag­ing more trans­par­ent affil­i­ate mar­ket­ing.

Today’s affil­i­ate mar­ket, like many oth­er dig­i­tal com­merce chan­nels, ben­e­fits from increased data and tech­nol­o­gy plat­forms. The abil­i­ty to real­ly drill down and man­age your ecom­merce efforts is height­ened, and enables smarter com­par­isons, jus­ti­fi­ca­tions, and busi­ness deci­sions. When con­duct­ed and man­aged cor­rect­ly, and show­cas­ing an impres­sive ROI fig­ure, it isn’t sur­pris­ing to hear that many brands have start­ed to invest more time, effort, and resource in the affil­i­ate chan­nel.

Affiliates vs. Partners vs. Publishers

With their indus­try recent­ly cel­e­brat­ing its 20th birth­day, there has been a notable shift in how those being paid on per­for­mance have adapt­ed to bring them­selves in line as pro­fes­sion­al out­fits. Although many start­ed out as small enti­ties, a sig­nif­i­cant per­cent­age have grown to become mar­ket lead­ers with hun­dreds of staff, dri­ving mil­lions in rev­enue each year and plac­ing them­selves along­side tra­di­tion­al media own­ers.

Affil­i­ates, part­ners, or pub­lish­ers – how­ev­er you define them – there are a num­ber of key points about their offer to take note of.

When work­ing more close­ly with them as an acqui­si­tion and reten­tion arm for your busi­ness – through man­ag­ing, mon­i­tor­ing and col­lab­o­rat­ing – it’s safe to say that affil­i­ate mar­ket­ing can, with­out doubt, sup­port any company’s bot­tom line.

Chris Johnson

Written by Chris Johnson

Content Director, PerformanceIN

Starting out as an affiliate on a number of search, loyalty and comparison and content websites, Chris learned his trade at a4u towers. The forum evolved into a news and blog portal (now called PerformanceIN), covering the latest in performance advertising which heavily involves affiliate as part of the marketing mix. Chris heads up the content for PerformanceIN and also across the PMI event series.


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