Bottom-Line ROI – Support from Affiliate Marketing

By Chris Johnson

Performance 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 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

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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