Blog

07 November, 2018

Affiliate marketing in numbers

Affiliate marketing has permanently entered the advertising budgets of companies around the world. Marketers know that integrating it with the existing marketing strategy of the brand significantly increases returns on investment.

Affiliate marketing on the rise or numbers do not lie

 

A few years ago, marketers pointed out performance marketing as the most important marketing skill to master (it was ranked higher than, among others, mobile marketing, SEO, CRO, or consumer insight). In 2016, more than 80% of US publishers and owners of online stores used  performance-based advertising in their actions. Expenditures on affiliate marketing are growing in the US by more than 10% annually.

Why is performance marketing effective?

Only last year (2017) 16% of all online purchases were made through affiliation. Consumers spend $7 more when they make purchases through affiliate links.

 

No other form of marketing is characterised by such growth. Companies are beginning to doubt that other forms of digital marketing (e.g. display advertising) can bring any tangible benefits. Affiliate marketing, in turn, provides you with incomparably detailed information about the customer. This is one of the more transparent business models.

 

Affiliate marketing is also associated with a small degree of risk, compared, for example, to traditional CPC campaigns, where the advertiser pays for every click, regardless of whether it resulted in the purchase of a product or not. Advertisers are also encouraged by a low entry threshold for this form of e-marketing. Although there are many others, the most common pricing model is the CPS (ang. Cost per Sale) where settlement takes place only when the product or service is sold.

 

Interest in performance marketing is constantly growing. By entering the phrase "affiliate marketing" in Google Trends, you will see a chart like this:

 

 

It clearly shows that the interest in affiliation has been growing continuously for 5 years and there are no signs that this situation would change.

Affiliate marketing and e-commerce

The stronger the online shopping market, the greater the benefits of working with an affiliate network. In 2017, as many as 54% of Polish Internet users made online purchases. What motivates consumers to buy online is primarily a 24-hour availability of the service.

 

The increasing value of e-commerce (in China, online sales in 2019 may amount to even ⅓ of total retail sales) cause that more and more companies choose cooperation with an affiliate partner because it allows them to precisely measure the effects of the campaign, and only pay for the results.

 

It also brings benefits for the financial sector. The development of technology and the fintech industry has caused a significant increase in the number of people using, for example, services of loan companies. Over 2 million Poles have used online loans so far, and 40% of them are those incurred through a smartphone.

Conclusion

Performance marketing is growing in strength. This is facilitated by the fast and continuous development of the e-commerce industry in Poland and around the world. The task of performance marketing is to generate sales. The costs of the campaign are closely related to the effects that have been achieved. The advantage of affiliate marketing over other forms of marketing is that it accurately indicates how much it cost to acquire one customer, and advanced analytics will tell us which marketing campaigns have produced the best results.

 

According to the predictions for the next year, trends to follow shall definitely include: combining affiliate marketing with influencer marketing, increasing traffic through the Messenger, exploring another billing methods, taking care of high positions in Google and finally further development in mobile services related to the fintech services.

Do you want to increase traffic in your online business? Do you wish to have more leads? Do you plan to sell more? Performance marketing is the solution.