Advertising that costs only when a purchase is made. This paradigmatic principle for advertisers made affiliate marketing big. Cost per Order (CPO) is still the most popular compensation model in Affiliate Marketing. Data-driven developments such as Apple’s Intelligent Tracking Prevention (ITP 2.0) or Mozilla’s Enhanced Tracking Protection (ETP) challenge the CPO model: Increasing cookie loss makes conversion tracking harder over longer periods of time.
How do the networks react to the cookie loss?
Webgains, which recently won the PerformixX Award in the category “Best Network & Tracking”, already switched to a solution last year that tracks the customer’s First Party Cookies. It enables a privacy-compliant tracking of the customer journey if the user follows an affiliate link and gives his consent on the merchant site. AWIN also relies on first-party cookies with its Master’s Day. Both networks warn of too much concern. For example, the ITP issue only affects a passing fraction of Safari transactions that take more than 24 hours to convert.
How the topic of data protection and associated restrictions develop, whether legal or browser-based, is of course difficult to predict. However, it is certain that the networks are working hard on technical solutions in order to make affiliate marketing viable in the future. In addition, the cookie problem also affects other advertising disciplines.
Admittedly, none rely so heavily on tracking conversions as affiliate marketing. Perhaps this is an opportunity to shake the monopoly of CPO compensation in affiliate marketing in addition to securing technology development and consent management. For old-established affiliate marketers, the thought may be unusual. But actually it can be argued well why a click should be worth the advertiser money.
How will affiliate traffic be distributed in the future?
In the past, there were many employees in the agency, who earned a nice pocket money as a publisher. The taxi driver who writes blog posts and collects affiliate commissions during the break does not exist anymore. The effort to compete with the mass, sometimes high quality content on the net is too small for small site operators.
The traffic in affiliate marketing is distributed on fewer and fewer shoulders. Perhaps courage makes the diversity update of Google, the niche pages again promises a ranking plausibility. Whether smaller publishers will really benefit from this will only become apparent. More interesting is probably the view of influencer marketing.
Also interesting: “It has become extremely difficult to stand out from the crowd”
Affiliate and Influencer Marketing: Love at second glance?
One or two publishers will certainly be inspired to look at their colleagues, called influencers. This refers to online users who share their expertise on a particular topic with others via digital channels. Do you notice something? The proximity to Affiliate Marketing is obvious. According to a Goldmedia forecast 2020, market volume in Influcener Marketing is scratching the billion mark in the DACH region. While the influencer marketing is going through the roof, the affiliate marketing is a bit dusty.
One reason is certainly the fact that influencer marketing is seen by advertisers predominantly as a branding measure, while in affiliate marketing historically measurable successes, ie the performance counts. Furthermore, influencer marketing takes place mainly in emerging social channels like Instagram, while old school affiliate marketing works through websites. But why not combine the strengths of both disciplines? Combine the results-oriented approach of affiliate marketing with the authenticity and reach of influencer marketing via social channels?
Does the demand for measurability of influencers strengthen Affiliate Marketing?
The networks have already created the first conditions and offer easy-to-install tools and widgets for influencers. The issue of measurability will increase in influencer marketing and possibly drive the trend discipline into the arms of affiliate marketing. Recently, the case Arii caused a sensation, which despite 2.6 million subscribers did not manage to sell 36 or 252 T-shirts (about this divorce the ghosts). Affiliate Marketing is ready and offers the appropriate platforms and technologies to increase the measurability in influencer marketing and to improve the organization. The combination of influencer and affiliate marketing offers exciting potential in brand performance marketing.
How does AI improve affiliate marketing?
Automation and AI have mastered online marketing for some time now. At least that’s what you think when you look at the trade media regularly. But concrete application examples for the use of artificial intelligence are rare. Affiliate marketing, of course, has a particularly difficult time, as no target groups are segmented via an intelligent process or the bids are controlled data-driven, such as in search engine advertising.
However, many exciting approaches are developing in affiliate marketing. For example, KI can give affiliate marketers recommendations to choose from the large and growing number of publishers. A fairer assessment of the contributions of individual channels in the customer journey is also tangible. This makes it easier to determine what contribution smaller publishers and influencers made to a conversion in order to adequately remunerate it.
The human relationship remains the ace in the affiliate sleeve
Affiliate marketing can not only better prove its contribution to the customer journey. It also has the opportunity to break the status of a pure distribution channel and become a holistic marketing channel. Last but not least, with the help of KI, future trends and thus potentials in affiliate marketing can be recognized at an early stage. With all these machine prospects, it should be emphasized that the human factor, personal relationships and trust can not be replaced by Artificial Intelligence and remain the soul of Affiliate Marketing.
Conclusion: Affiliate Marketing is “hot” in the marketing mix
The prognosis: Affiliate marketing is and remains definitely “hot” and will be part of every reasonable marketing mix in the coming years. It continues to provide attractive, low-risk conditions for advertisers and provides reliable revenue to simply disappear from the scene.
As painful as data protection laws such as DSGVO and ePrivacy are for online marketers, they exert a need to innovate, which in the affirmative makes the Affiliate Marketing legs. Technological progress and increasing integration with influencer marketing are just two starting points that will make affiliate marketing an attractive marketing channel in the future.
You might also be interested in this: Why the GDPR does not have to mean the end of good online marketing
Dirk Lajosbanyai is co-founder and managing director of ad agents GmbH. In Affiliate Marketing he is one of the first movers and proven experts.
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