How Affiliate Marketing Is Shaping E-Commerce

By Zine Bitat On Mar 18, 2020

Who does not like a recommendation when it comes to a purchase decision? And if that comes from a trusted source, it does help to sweeten the buy. At the core, Affiliate Marketing is the e-commerce version of product promotion through an online influencer/marketer and has helped many a brand to connect with audiences, who they would otherwise not reach.

In the context of the brand’s digital strategy, the impact of affiliate marketing has led to a flourishing e-commerce sector especially in the Asia Pacific region – which is poised to lead the world in eCommerce Sales. Brands are witnessing an increased activity from product-related Google search queries to search queries on eCommerce partners sites directly – whether it’s the big players like Amazon, Lazada, Tokopedia or partners such as cash backers, coupon websites, best deals, micro e-commerce, etc.

Given the increase, it’s only logical for brands to augment their Affiliate Marketing strategies with complementary solutions in order to increase sales/revenue and also optimize their CPA (cost per action). Let’s take a look at how affiliation can be the right solution to increase e-commerce strategy efficiency for brands.

Firstly, Affiliate Marketing is a performance-based marketing program, where an external partner is rewarded a commission for delivering a specific result to a merchant or advertiser. This ensures that brands do not take any risk as they pay only in case there is a completed transaction or generated lead. In other words, brands take advantage of the notoriety/audience of affiliates (publishers) to earn new sales and increase its e-Commerce share of Voice.

Secondly, affiliation platforms today allow brands to have a big number of affiliates within different typologies in order to have good coverage of all partners/fields who can help brands with their e-Commerce exposure; the most popular ones being cashback websites, coupon websites, top deals, promotional websites and the likes. These technologies allow brands to de-duplicate conversions across the whole media plan and exclude affiliates when the incremental value is not evaluated as good enough. Also, they enable one tracking, reporting and creative point for all partners which is efficient from a publisher management point of view. In addition, brands have the choice to go only with some affiliates and choosing a premium network as some clients prefer working with a closed network.

Thirdly, affiliation platforms have developed brand safety tools (internal or external) to minimize/stop any fraud in order to ensure clients that only validated/verified sales or leads can go through. Besides, in most cases, the numbers of affiliation technologies and a brand’s internal tools are crossed-checked to be sure that there is no fraud and all transactions are valid.

Fourthly, affiliate typologies are getting bigger because, a lot of new categories such as influencers, content websites, blogs that work on a full performance business model or at least on a hybrid model (traffic + performance) which allow brands to diversify their presence across different audiences with an efficient business model. The introduction of influencers on affiliation platforms have accelerated sales and visibility considerably for brands as they have larger audiences across different platforms: Instagram, TikTok, Snapchat, etc. The ability of affiliation to unify business model across a lot of publishers (affiliates) on one platform to optimize client KPIs is a strong differential in comparison to other Digital Marketing channels.

Despite the huge growth potential and impact of affiliation on e-Commerce – lack of understanding, awareness, expertise, capabilities do inhibit consideration of this channel. Most brands do not consider affiliation in their digital strategy as they are not aware of all the benefits/chances mentioned above. Also, some decision-makers consider affiliation as a low-cost solution with a lot of fraud risk which is not the case today as technologies have evolved and allowed high-quality control on all placements. Finally, affiliation needs internal experts to control the program and to challenge publishers and most of the digital service providers do not have these skills internally and may miss an important opportunity for their clients.

The rapid increase in consumer spending in Asia is a lucrative opportunity to explore the effectiveness of Affiliation Marketing strategies and overcome the challenges of the medium. To sum up, Affiliation Marketing can be a solution for all brands who want to increase their e-Commerce share of voice and to reach affiliates (publisher) audiences with a controlled and outcome-driven business model.