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Three Predictions Set to Change Affiliate Marketing in 2018

Three Predictions Set to Change Affiliate Marketing in 2018

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Three key changes that will drive change and growth within the affiliate marketing space.

When some people hear “affiliate marketing” they assume that ours is a sleepy, niche channel. Nope. These days, the category is responsible for an impressive 16% of e-commerce sales, ranking right up there with email marketing and ahead of both social commerce and display advertising.

Our space is an incredibly dynamic one, and its steady growth rate and continued healthy contribution to the bottom line are the result of constant innovation and evolution. Here are three key forces that will drive change -- and incredible growth -- in this space in 2018.

“Partner marketing” will become the go-to name

Despite the health and accountability of affiliate marketing programs, the industry is rapidly rebranding itself away from the legacy name of “affiliate” to that of “partner marketing.” Part of this shift has to do with sloughing off historical (albeit inaccurate) negative connotations associated with the affiliate marketing moniker. Our world of partnerships should be recognized as the clean and incredibly white hat space it has become. After all, the vast majority of affiliate programs now pay only after a confirmed purchase, so investment is perfectly aligned to results. Partner marketing avoids that legacy mindset while accurately reflecting the nature of affiliate relationships.

Furthermore, the term partner marketing much better represents the ways in which the industry’s programs and revenue models have opened up to encompass a greater range of partner types. These days, companies are increasingly steering away from a one-size-fits-all model for their partners and individually tailoring the terms of their relationships to capitalize on the strengths and goals of all parties. Thanks to this customization, we’re seeing a rise in unique and innovative partner arrangements, and major brands that have never focused big attention on “affiliate” marketing are now becoming very active in “partner” marketing with both traditional and nontraditional publishers.

Real-time data will become a primary growth driver for major advertisers

Data-driven marketing has become the leading strategy for consumer marketing, and the affiliate space is no exception. Real-time performance data and proactive data sharing with technologically sophisticated partners will help drive extraordinary growth for large partner marketing advertisers. Instead of waiting days or weeks for insights to improve marketing performance, brands and their collaborators will work in real-time to make the most of every business opportunity

I’m convinced that in 2018, we’re going to see metasearch rise as a powerful personalization tool in retail. Metasearch engines enable consumers to comparison shop across many properties. As such, the ability to monitor and adjust product listings and deals on the fly is increasingly vital for successful partner marketing.

In addition, real-time performance data will transform the ways we sell distressed inventory. When items go too long without being sold, it becomes increasingly hard to make the sale. This is particularly challenging in industries like travel, where undersold flights hit hard on the bottom line. But with real-time data, travel marketers have the ability to boost partner incentives on the fly for those who can secure passengers for last-minute vacant seats. After all, a vacant seat earns nothing for an airline. Thus, handing a higher percentage of the late sale to a partner still represents a win-win scenario for both parties.

Artificial Intelligence will help brands redefine strategies and drive accelerated growth

Artificial Intelligence (AI) has revolutionized many areas of marketing, and now it’s transforming partner marketing as well. AI has emerged as a powerful tool to help brands predict the future sales from individual partners and programs. This massive new level of insight into what will happen, versus simply what has happened to date with a partner program, enables a more sophisticated approach to optimization for partner marketing.

By understanding what’s coming, brands are becoming more nimble in creating programs to capitalize on newly identified business opportunities. They’re able to identify the partners that will yield the greatest future profits and double-down on their relationships with those partners. In an industry where trusted relationships are vital to program success, the ability to understand where marketers should focus their greatest efforts is a game changer.

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Jim Nichols

Jim Nichols

Jim Nichols is CMO of Performance Horizon. A 20+ year veteran of digital and partner marketing, with extensive experience in martech, media and 80+ B2C categories. Previous roles include Singular, Conversant Media, Carat, Apsalar, Sega and DDB.

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