Way back last December, little did we know what 2020 would promise for the world of affiliate marketing. In fact, the world itself felt a very different place!
At Affiliate Summit West, there was talk of a new virus but we’d no idea of how that would impact the coming year. By February and certainly March we knew that 2020 was going to be a very different year indeed. We wrote a short blog post overview of what the pandemic could mean for affiliate managers; but even then so little was known of the economic effect and how the future of affiliate marketing would shape up.
We have asked some of our friends and partners in the industry for their thoughts on the year. We also asked Geno, Brian, Tara and Nic what to expect for 2021 in affiliate marketing.
How Did Our 2020 Predictions Go?
Along with others in the industry, I gave my own expectations for the year in AM Navigator’s blog, We also read many other views on what they expected the trends in affiliate to be. These varied hugely – and sometimes almost seemed as wishful thinking to fulfil needs of their own businesses. That way their hunch would be fully validated!
Some of the most common predictions made included:
• Brands will take more control of their affiliate programs
• ‘Channels’ of influencer, affiliate content will continue to be blurred as more publishers move to affiliate monetization
• Mobile will continue to be key and the split with desktop will erode
• Brands will improve display and affiliate campaigns
• 2020 will be the year of AI and machine learning in driving partner collaboration and analytics
• A strong focus on data privacy
• The move to go beyond last click will accelerate
• Affiliate will get increased attention as the ideal solution for application of technology and driving strong ROI
• Coupons will be increasingly requested and used by content publishers
…and What Will 2021 Bring?
We asked some of the leading figures in the affiliate industry for their thoughts. What from last year’s actually came through – and given the new landscape in every market, what will the next year bring.
CEO AM Navigator and Loyalize
While I could certainly go the route of predicting even more affiliate marketing mergers, acquisitions, and IPOs in 2021, I’m gonna go a different way…
At the dawn of a new year, I’d like to make a wish: for the vaccines and the vaccinations to be effective enough for all of us to return back to in-person business doing, conference attending, brainstorming and “talking shop” in the same place, and creating happy memories over cocktails and laughs.
This will, in turn, fuel the affiliate marketing industry to reach new heights of innovation, sophistication, but most importantly fun. Here’s to a Happy New Year, ladies and gentlemen!!
VP Global Marketing, TUNE
Brian gives us an in-depth view of both his predictions of last year – and the vision for the year to come…
No one is born with the skills to read the future. But after a few revolutions around the sun in the affiliate space, there are some leading indicators of change I’ve come to observe.
On the whole, most of what I thought would happen, did. It just played out much faster and differently than I expected. What I couldn’t predict were a couple key events that led us to today. For one, a global pandemic that would fundamentally change the way we work and live was not on my radar. And two, consumer privacy became an unavoidable, red-hot issue sooner than the digital advertising world thought it would. These events played out simultaneously, and the world of partnerships was never the same.
Here is a quick look back on my predictions, augmented by my perspective of hindsight of today:
“In 2020, brands will begin to take more control of their own affiliate programs and build programs to their own spec. All aspects of a program will become more configurable, as no two partnerships are the same….”
From where I stand, 2020 was about controlling the things that were within your control, because so much was not. More importantly, it was about looking at your brand and the programs that improved its chances of survival, and locking those down in a big way.
This was already happening with the rise of DTC marketing, but COVID-19 became the true catalyst. Dramatic shifts to the global supply chain forced more brands into the direct-to-consumer model as they sought to decrease supply chain costs and increase predictability. Partner marketing works toward both of these goals. Publishers, not brands, bear the financial risk, and they provide brands access to loyal, embedded audiences.
Subscription businesses and fintech companies also saw the value of the partner channel. Makes sense, given that 2020 upended the traditional retail model.
As a brand, control meant going direct with their partners, completely owning the end-to-end experience. Partners that fit into this end-to-end experience required deeper strategy, integration, and investment — no two relationships were the same. Brands de-risked their spend by aligning with partners that had already built trust with their audiences; as a result, influencers and content partnerships were highly sought after as the most direct and authentic path to expanding growth. Once these relationships were solidified, it was imperative for the brands to grow their relationships as a means to fend off competitive advances. Discovering niche (and proprietary) partnerships helped DTC brands reach new audiences quickly and directly. Consumer trust played a huge role in moving product, and expert recommendations fared well.
“…including new tracking methods, commissionable events, payout terms, automation/performance logic, and data granularity.”
With this came all the program-level components that also had to align, including new ways to look at commissioning. For example, as business models pivoted to be more subscription-like, new and emerging subscription channels necessitated new actions to commission upon. The online CPA playbook became a way to think about the rise of actions beyond the install on mobile. Automation stepped up to aid in publisher discovery, with smart tools to help brands find new partners at scale. And many brands built new, proprietary relationships with partners who had not previously engaged with the affiliate model. Brands had to go out and find these partners, and AI-driven companies like Publisher Discovery sprung up to help them do so.
“…And thanks to advancements in digital tracking, the ubiquity of mobile payments, and optimization in cross-channel customer experiences, the race to unlock “the mobile” in affiliate partnerships will heat up…”
Mobile also took center stage during the pandemic, given the smartphone’s outsized role in daily life dominated by social distancing and quarantines. New generations of consumers also entered the market with a mobile mindset, causing purchase patterns to shift. Unsurprisingly, many large network partners started announcing partnerships with MMPs, or mobile measurement partners.
Until recently, the term MMP was a big question mark for most of the affiliate ecosystem. That’s no longer the case. Companies like AppsFlyer, Adjust, and Branch are waking up to opportunity to evolve beyond tracking installs and move into deeper actions that advertisers value – actions that can be tracked by their software on the traditional affiliate side. I had started the discussion on these . At the time, it may have felt alien to many for me to bring the two together; once the pandemic hit, however, combining mobile and affiliate seemed like the natural next step for brands seeking to expand their horizons in this new world.
“..Starting in 2020, many of the organizational walls of mobile user acquisition and desktop affiliate teams will disappear. Mobile and desktop tracking standards will converge…“
With mobile finally taking prominence in digital marketing, the walls started to come down. I think the concept of the “growth marketer” has been the organizational answer to break through these walls, as newer companies enter the market without the shackles of an old org model.
Affiliate UX Improvements
“And affiliate user experiences (e.g., routing from web ad to app product page) will vastly improve, enticing new and exciting partners to join the ecosystem.”
With tracking improving and UX getting ironed out on mobile, the onsite experience with affiliate customers is the last mile. I have noticed several new companies hitting the PerformanceIn Top 50 that address cart abandonment, shopping chatbots, and the like.
If nothing else, 2020 became a year of realizing many long-standing, hopeful trends. There are few things as powerful as a natural disaster to move people into action. While the pandemic brought little good to the world, it did remind us how resilient humans are. Humans power partnerships and the human connection continued to help companies of all sizes push through a tough time and set a new trajectory. I am incredibly thankful for this tenacious group of people and the companies that doubled down on partnerships over the last year. Now on to 2021!
VP of LinkConnector
An underlying trend predicted last year that has certainly become a reality is the heightened attention of affiliate marketing as a scalable sweet spot for brands to grow customer acquisition, access technology solutions and increase revenues all while achieving a profitable return. With the coronavirus pandemic vaulting eCommerce competition and altering consumer shopping behaviors, I see this trend growing in force as merchants leverage the proven resiliency of affiliate marketing to deliver low-risk, profitable growth.
I also see this trend extending notably in 2021 where affiliate marketing will increasingly be an essential ingredient of omnichannel strategy and success for eCommerce merchants as affiliates have front-row engagement with consumers to introduce relevant offers at the right time and place in a user’s shopping journey. Additionally, I believe technology affiliate partners will become an integral part of marketing tech stacks for retailers – these are daring innovators with performance driven solutions to help improve customer experience seamlessly through real-time personalization or through virtual shopping assistant chat conversations as examples.
Our industry’s strategic mergers and acquisitions that occurred this year despite the COVID-induced global economic uncertainties underscores the rising demand and importance of affiliate marketing for eCommerce.
Director & Investor, Tech & Agency Groups
As the affiliate market has matured, so we’re starting to see an overlap of behaviours that are more akin to the broader advertising markets.
1. Data is King:
At the heart of conversion optimisation remains data; and the availability of data, while not commoditised, is becoming more prevalent throughout affiliate, a few years after it became central to advertising in a broader way. There’s a number of strong third party technologies that are driving analytics and data through to advertisers – and I suspect that will be driving not just performance management into 2021, but the whole of the marketing agenda. Having performance data at the top table isn’t necessarily new, but it will become ever more impactful as affiliate remains at the forefront of both the sales funnel and ever deeper into the marketing one.
2. The Art of Conversation:
Just like the year of mobile, the year of chat has been a long time in the making. From Zendesk to Intercom, to new players such as Envolve, chat is starting to take much of the space originally taken up by search. Development in AI means that chat is becoming a sales channel as much as a customer services one; users are turning more to chat for delivery information, no longer content with the updates they receive via email. With the growth of affiliate players like Envolve, expect more performance driven sales channels appearing on retailer sites throughout 2021.
Sorry Geno, but this is only going to grow into 2021. Despite the pandemic, we saw a number of advertising and affiliate acquisitions in 2020. The networks will become even more active, seeking out advantage from technology and publisher suppliers alike; while consolidation of agencies, both territorially and sector wise, is only going to increase. The threat of SaaS versus “traditional” networks will see response, while the SaaS players, with their warchests, will throw off the upstart label and become even more significant, cheating the growth curve by buying their way up the ladder. And if you think I mean that in a disparaging way: not a chance. Buy & Build has its own merits, and I suspect the landscape at the end of ’21, across networks and agencies, will be somewhat different – and leaner – than it is today.
As an OPM agency, Silverbean had seen some significant moves across networks to SaaS clients too. We have seen the continuation of enterprise brands across multiple sectors move onto SaaS solutions in order to push their programmes further with advanced technology to support their strategies.
By September 2020, we’d seen three key trends for brands within partnerships:
1. Brands saw a spike in sales online and wanted to use affiliate and partnerships to capitalise and increase market share.
2. Brands wanted to reduce risk from their marketing campaigns, reduce spend and risk and offset other channels payment models to a CPA option.
3. Brands who used traditional media and offline partnerships to drive sales were now looking to adapt online.
Networks are looking to adapt to this by developing their tracking solutions or looking to increase their focus on attracting new SME clients. That is something we have seen increasingly with new SME tracking offerings from both Awin and Tradedoubler in Europe as well as other providers across other Geos.
When we look towards 2021, I believe it will be the year for SaaS, app marketing and brand partnerships. When it comes to tracking, SaaS providers have now built a great portfolio of clients across enterprise and SME brands alike in order to showcase the value of affiliate and partnerships. With a growing amount of skill in the sector, using in-house talent or combining agency and SaaS is a prime solution.
Brook outlines some of the key developments he expects in 2021:
- COVID gains will largely be permanent, as consumers now expect the convenience of online shopping.
- Amazon will continue to grow and other retailers will have to account for how competitive their affiliate program is compared to them.
- On the publisher side, awareness of affiliate marketing is already high. What will continue to improve is acceptance thereof, to the point that any executive responsible for revenue will be expected to account for his or her affiliate monetization strategy or lack thereof. In short, more links will be monetized.
- Coupon usage will continue to grow, especially because they’ll be a tracking token as privacy changes like ITP break more traditional tracking.
Impact will achieve its goal of being acquired.
…AND FROM A PUBLISHER PERSPECTIVE
So what about the publishers?
We know some of their challenges from conversations we’ve had during this year. You can read more from a few viewpoints in the Publisher Spotlight articles we’ve published. Hopefully many of those in travel such as those we interviewed, will start to see business start back up properly – but many such as Chris P King will have pivoted to new areas.
For most in the general retail verticals, this year has been one of continued growth. This year has seen In fact, we hear that the second weekend of December was stronger even than Black Friday in sales volumes! In many verticals, the affiliate model has demonstrated its resilience to publishers in being able to consistently deliver revenues.
There has been a seismic shift to online shopping among demographics that had previously been resistant to it this past year. The affiliate model in its many guises has been able to scale to cope with this and consistently deliver effective ROI for both advertisers and publishers.
Many general marketing and advertising budgets were cut early in the year and there followed a definite shift towards performance and particularly affiliate. More publishers have been implementing affiliate ads to monetize their properties more effectively. This isn’t always simple and often a whole new experience. Nilla Ali of Buzzfeed said in a recent Martech Record conversation: “I think the biggest reason publishers do not get into the affiliate space is fear of operationalizing it and doing it well… So creating some kind of operability in affiliates is the key to success.”
She adds “its important for larger publishers to have someone who is the champion for all things commerce and conversion is hugely important, as in media it is not typical to optimize for conversion, it is typically views or impressions.”
For thousands of other publishers of all sizes this has been a tough year. All in all though, it has been the resilience of the affiliate model that has ensured that generally our industry thrived in spite of everything. The most agile and creative will of course thrive. For others the added complication of tracking changes may compound to make returns from affiliate less attractive.
We of course would emphasize that is why it is crucial to be continually reassessing your affiliate partnerships to ensure you are fully engaged with the most relevant and valuable. Publisher Discovery is set up to help affiliate managers do exactly that – you can see more in a live demo with our team.
So whatever the next year throws at us, nothing is likely to compare to the impact of the current pandemic on the world’s societies and economies during the past 9 months or so. in 2021 affiliate marketing is more than likely to continue strengthening its role in ecommerce.
WITH MANY THANKS TO OUR FRIENDS FOR THEIR CONTRIBUTIONS.
Geno Prussakov, CEO of AM Navigator, CleverGiver, Loyalize and AM Days
Evgenii “Geno” Prussakov is a keynote speaker, award-winning digital marketing expert, and educator. Geno is founder and CEO of AM Navigator (a top affiliate management agency), co-founder and CEO of Clever Technologies (developers of CleverGiver.com and Loyalize.com), and founder and Chair of AM Days.
Brian Marcus, Global VP Marketing at TUNE
Brian Marcus, TUNE’s Vice President of Global Marketing and Partnerships has been shaping performance marketing — as a digital marketer, as a platform owner, and as a product strategist — since 2002. Brian launched into eCommerce leading customer acquisition at JC Whitney, a century-old cataloger destined to move online. From there, he went on to build-up two global affiliate marketing platforms, one at Google (Google Affiliate Network) and the other at ebay (ebay Partner Network).
Just prior to TUNE, Brian was VP of Marketing at Teespring, an ecommerce platform for creators to design, merchandise, and sell customized consumer products. Brian is a Chicago native, a Cubs fan, and a music fanatic. He now considers Seattle his home. He earned his BA from Grinnell College (in Iowa) and his MBA from the University of Chicago (Booth).
Tara McCommons, VP Linkconnector
Tara McCommons is VP of Sales and Marketing at LinkConnector, a performance marketing network providing superior service and technologies to affiliates and merchants for over 15 years. Tara leads a high performance team playing a pivotal role in identifying and recruiting new merchant and affiliate opportunities to continually expand the LinkConnector Network.
Tara is has been a speaker at past Affiliate Summits, a contributor to FeedFront, and a Board of Directors member with the Performance Marketing Association.
Mark Smith, Director & Investor
Nic Yates, Silverbean
Nic is Performance Account Director at Silverbean, and is responsible for ensuring that client campaigns are focused on supporting sales acceleration and digital performance. Nic has worked with major brands from across the retail, luxury and lifestyle sectors. He takes a strategic look at how existing and potential clients can get the best from their affiliate and partner marketing strategies.
Brook Schaaf, CEO FMTC
© 2020 Publisher Discovery
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