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Peering into the Future of Performance Marketing: Ten 2013 Predictions

Peering into the Future of Performance Marketing: Ten 2013 Predictions

1. Advertiser thirst for data-driven insights will call for networks and agencies to work closer together

‘Big Data’ is the new marketing buzz term on everyone’s lips. This is the idea of pooling data from multiple channels/sources into very large data sets. This data is then analysed in order to gain valuable insights into otherwise unseen trends and ultimately drive more efficient and effective performance. It is something which all major advertisers should be looking at in 2013 and it extends way beyond performance marketing. The knock on effect is that agencies will have to work more closely with networks in order to align tracking and reporting methods and in some instances work together to analyse data to provide valuable insights to the advertiser. It is the advertisers who encourage knowledge and data sharing between affiliate networks and media agencies that will reap the greatest rewards in 2013.

2. Mobile specific publishers will emerge

Mobile devices (smart phones and tablets) accounted for over 18% of all Affiliate Window sales in the last week of 2012 and 2013 may finally be the official ‘year of mobile’. However the top sales driving mobile publishers are currently the same as the top sales driving desktop publishers. Now that a large proportion of advertisers have smart phone tracking in place and tablet penetration in the UK hit almost 20% at the end of 2012, a smart phone or tablet specific publisher offering with the ability to drive significant sales volume is surely just around the corner? Furthermore as tablets are geared towards content consumption with 54% of tablet users engaging with eMagazines compared to just 24% of desktop users (source: Morgan Stanley Blue Paper - Tablet Demand and Disruption), there’s a real opportunity for major online publications to make waves in the performance space via tablets in 2013.

3. Performance marketing will raise its profile

2013 will see the release of results from the most comprehensive performance marketing survey ever undertaken. The AMC in conjunction with the IAB will publish results which will reveal the size of the market and should see performance marketing make a well-deserved leap towards the echelons enjoyed by search, display and social media.

4. There will be further regulation and fraud prevention

With increased exposure comes increased scrutiny and the predicted upwards shift in performance marketing’s status within the online marketing mix will call for further regulation and fraud prevention within the channel. Networks and agencies alike will need to demonstrate clearly their ability to protect merchant brand identities within the space, protect the consumer from being misled and prevent any fraudulent sales activity from publishers on their affiliate programmes.

5. Networks will expand their service offerings

There are not many major advertisers out there who aren’t currently operating an affiliate programme. The upshot of this is that winning exclusive business (which let’s face it is what we’re all after) nowadays comes at a loss to another network or agency. 2013 will see networks expand their service offerings in order to further differentiate themselves from the competition.

6. The largest publishers will continue to grow

In 2012 we saw above the line advertising campaigns from the likes of Quidco, Topcashback and creating mass awareness of offer and deal based sites which had previously been relatively unknown to those unaccustomed to searching out deals online. More recently comparison site have followed suit and it wouldn’t surprise me if many of the larger publishers did the same in 2013 in order to grow their user bases and ensure they are at the front of advertiser minds when it comes to promoting their products and services.

7. More advertisers will adopt multiple payment models

Performance marketing has traditionally centred on a cost per acquisition model but it is now common place to adopt a hybrid payment model amongst some publisher promotional methods. In 2013 we will see further payment models enter the space via mobile with mobile display on a cost per click basis as well as increasing numbers of advertisers including lead generation under their performance umbrella and paying out on a cost per lead basis.

8. Online to offline activity will become commonplace

Online publishers currently drive offline sales via voucher code apps which allow the user to redeem codes in store (such as in the instance of this successful Debenhams campaign) but these methods are often limited by the capabilities of retail outlet EPOS systems to record voucher code redemption and reward the publisher accordingly. In 2013 there will be an increasing number of mobile handsets (including the iPhone5) employing near field communication technology which allows consumers to pay for items in store using a digital wallet on their mobile device. In 2013 this could open up a wealth of opportunities for publishers (in and outside of the voucher code space) to drive in store offers to consumers via mobile devices and be rewarded for influencing subsequent purchases in store without advertisers having to make major changes to their EPOS systems.

9. More performance opportunities will appear within Facebook

In September 2012 Facebook founder Mark Zuckerberg said that it’s only a matter of time before Facebook drops an ice cube down the back of Google’s vest (my words, not his) and expands its current search offering. Zuckerberg says that ‘Facebook handles around 1 billion search queries per day without even trying’ and that they have a whole team dedicated to search but what could this mean for performance marketing in 2013? Well presumably this new, expanded search space will include sponsored listings just as all other major search engines before it. Publisher search agencies will no doubt have a close eye on this space and spot opportunities to absorb advertiser CPC costs and protect advertiser brands.

10. Lead generation will gather steam

Lead generation has come a long way over the last 12 months and 2013 will see a re-education of those advertisers who once had reservations about the validity of the leads they might receive. The Affiliate Window lead generation team have been careful to ensure that leads are fully cleansed and verified before being delivered back to the advertiser. As more advertisers realise that this is a possibility and that they can choose to only pay for fully verified leads, more will explore possibilities in this area.

2013 will be a big year for performance marketing. Greater awareness of the channel will lead to greater investment and the ability to harness new technologies in accordance with consumer habits. Networks will need to diversify their offerings and agencies will need to work closely alongside them in accordance with advertisers’ increasing need for a holistic view of their online marketing mix. It is an exciting time to be in an ever-evolving industry such as this one and I for one am looking forward to seeing what 2013 brings.

Simon Hofmeister

Simon Hofmeister

Simon has been at Affiliate Window for over 3 years during which time he has managed major teleco

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