In 2019, we’ve seen affiliate marketing and partnerships grow rapidly across Europe, with more and more brands increasing their investment in these channels. As the partnership space broadens to include a more diverse set of partners and partner types, so has the ability for programs to deliver against a broader set of KPIs becomes stronger.
The pay-for-performance model is proven to deliver outstanding ROI, be a viable source of customer acquisition, and drive higher lifetime customer value. As adoption spreads further across Europe, here are five approaches that can help drive continued strong growth in 2020.
1. Expand content partnerships
The depth and breadth of partnerships are growing at breakneck speed. Brands are experimenting more to find the optimal blend of not just partners, but partner types. In Europe, the affiliate space is growing with traditional participants like cashback and coupons and has now grown to include influencers and content publishers. Consumption of content is on the rise in part because mobile is increasing total connected time. Consider that in the UK, for example, mobile devices now account for 78% of all adult online minutes, and further, content umbrellas such as BBC and News UK sites fall in the top 10 properties for digital reach.
These numbers are for the UK, but the same trend can be seen across Europe. Brands will see continued growth in the opportunity to partner with premium content publishers to meet consumers in various stages of the buyer funnel. Integrating with content that is relevant to a specific audience can be rolled into a more strategic partnership mix. Use content for awareness and consideration, whilst keeping those cashback sites and coupon codes to seal the deal.
2. Go deep on leveraging local market expertise and shopping habits
As with expanding channel investment in any region, one of the first things you learn about partner marketing in EMEA is that you need to really understand the local market to succeed. For example, online commerce in Germany looks very different than commerce in other major world economies.
German consumers have embraced e-commerce a little more gradually than those in leading world markets. While the German economy is more than 40% larger than Britain’s, for example, the total value of its e-commerce sales is significantly lower. That means that in Germany, e-commerce sales are just 8.8% of total retail sales, versus 16.5% for the UK. Nevertheless, most of the retail sales growth in Germany is coming from online and mobile commerce. And in the coming years, we expect the growth rates to far exceed those in more developed markets like the US.
In addition, many Germans expect retailers to offer post-delivery, invoice-based payment methods, instead of focusing solely on credit or debit cards. Theirs is not a “debt culture” like North America. Allowing consumers to order now and pay later really is crucial for success.
Other regional nuances abound throughout EMEA and marketers must pursue more robust understanding across borders.
3. Commit to mobile and mobile measurement
It’s true, the digital community has been saying “mobile-first” for over 10 years. But the numbers simply don’t lie. In France, for example, mobile commerce sales were predicted to rise by 20.6% this year. In Germany, well over one-third of e-commerce sales are being made on mobile. These are just two examples; mobile usage for commerce continues to grow across Europe.
For partner marketers, a strong mobile strategy and measurement plan is mission-critical because many of the most well-known technologies for affiliate cannot, by themselves, holistically measure all partner-based revenue that passes through the mobile web and mobile apps.
Apps are of growing importance to affiliate marketing. Partly because of their value for retail app install campaigns, and partly because of the higher conversion rates that retailer apps consistently deliver versus the PC and mobile web. Ergo, comprehensive app management is essential.
4. Emphasise transparency
We’ve entered an era in which consumer trust has risen to the top of marketers’ priorities. The General Data Privacy Regulations (GDPR) have been in effect in the EU for the better part of two years, and other global regions are following suit with similar legislation.
The good news for those in the partnership and affiliate space is that more brands are getting on board because the industry doesn’t track intrusively. Companies are shifting to platforms that enable the use of first-party data, server to server tracking, and full clarity for consumers as to what is happening to their data. In 2020, we expect this trend to grow exponentially as regulation increases and reliance on third-party cookies declines. The ability of partnerships to deliver on the promise of transparency is unparalleled.
5. Monitor the DTC space
Direct-to-consumer (DTC) brands have been the eCommerce darlings of the US retail world for years, but that model has seen slower adoption in Europe. But that seems to be changing, especially in the UK.
For these emerging DTC brands, partnerships with major retailers is a way to grow awareness and develop a following. Influencers have also been the core of many DTC marketing plans. Momentum for these brands comes through word of mouth and social communities, and success relies on the ability to deliver and pay all partners on time. For these new brands, being able to scale partnerships and their businesses will hinge on automation and strategy.
But why should you care? Well, if you work for a DTC, exploring creative partnerships will be important in 2020. And if you are not working for a DTC, it’s important to monitor these brands as they are driving significant disruptions in many categories.
2020 promises to be another great year for the partnerships space. By considering these five concepts, you can help ensure you get more than your fair share.