By Maura Smith, CMO on June 6, 2019
Over the past year, there has been an
increasingly visible effort by certain “don’t call us affiliate” solution
providers to declare the death of affiliate marketing. Nothing could be further from the
truth.
While the legacy network model was in
desperate need of disruption and innovation (FYI, it’s happening),
declaring that network model dead (as we have done) is
absolutely accurate. However, with projections showing $8.2B in
US spend to be generated by 2022, the affiliate category is far from
dead.
On the contrary, as a subject matter expert
and primary contributor to the channel’s growth for more than a decade, I’m
here to report a red herring in the channel. A blatant game of semantics is
being played by some in the space—one that appears to be born out of a need to
redefine the competitive landscape in their favor by casting a dark shadow of
irrelevancy, stagnancy, and apathy over established competitors. All this while
supporting a narrative that the addressable market opportunity for this newly defined
category is far beyond that which has been traditionally associated with the
affiliate channel.
Ok, let’s be real here. In an environment
where the cost to acquire a customer continues to increase, and walled gardens
of Facebook, Google, and increasingly Amazon, are the dominant players,
marketers simply need an alternative that creates operating leverage based on
scale and business outcomes. The addressable market for affiliate is growing in
direct proportion to that need. In short, there is no logical
need or requirement to change names for that expansion to occur.
Unfortunately, this “clickbait” attempt to
create fear, uncertainty and doubt, only creates confusion and diverts
attention from the compelling innovation that is taking place within a marketing
channel that has resolutely embarked on the next stage of its journey. The
shock factor has not gone unnoticed and the industry is responding.
The problem with the propaganda marketing is that many who have been exposed to
this darker message will not have the ability to decipher between the true
present state of affiliate marketing versus a message whose primary purpose is
to substantiate fundraising valuations while painting the competition as relics
of a now-defunct channel. The tactic is clever. It is at once bold,
controversial, and disruptive. The ultimate wedge, or so they would like you to
believe.
Don’t be fooled. Savvy marketers know better.
A name change is just that: a name change. Changing the name doesn’t mean that
the mechanics of the channel have altered. Changing the name doesn’t mean the
solutions are better. Paid search didn’t change its name when Google made
changes to advance search capabilities and started to display PLAs. Display
didn’t deviate from its name when programmatic came on the scene. A channel’s
progress or success is not determined by its naming convention. It is
determined by results. Category innovation and advancement happen because smart
people identify opportunities to improve, and take risks to deliver those
improvements. Those improvements are happening across the affiliate
marketing category and the idea that a channel’s name can serve as the defining
characteristic of its value is ludicrous.
What the channel does offer
is the ability to deliver results on a pay-for-performance basis with scale. It
encompasses all forms of marketing, lending credence to its uniqueness and
ability to diversify marketing efforts. While at its core, it is driven by
relationships and personalized approaches, it is increasingly benefiting from
technologies designed to automate the manual tasks that historically made it
challenging to achieve scale in the channel outside of cash back and coupon
publishers—and its pricing models are changing to
align with marketer needs.
Still questioning the health of
affiliate?
·
• Category revenue is projected to reach $6.8B by 2020
·
• The U.S. market is estimated to grow at a 10% CAGR
·
• The affiliate marketing sector is growing—accounting
for 15% of all digital
media spend
·
• Affiliate Marketing delivers a 16:1 ROI
·
• Over 80% of brands have
affiliate programs
·
• Investment, merger and acquisition activity
within the space over the past 18 months has been significant
Whatever side of the fence you find yourself
on—team dead or team alive—please know that you can call it whatever you want:
relationship, performance, even partnership marketing. None of this will change
the simple fact that contrary to a certain marketing campaign, affiliate
marketing is still very much alive—and well.
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