Interactive Seven 2009 Supplement - Marketing Week

MWIB_260209_p019 19/2/09 17:25 Page 19
INTERACTIVE AFFILIATE
Searching for trends: Analysts
predict that the next 12 months
will see an increased focus around
social media networks and search
giant Google
in 2007, and it is estimated that the number of ads broadcast during
video content will increase by more than 70%, according to eMarketer
– a website that keeps marketers up to date with trends and developments
in online marketing and emerging media.
Affiliate Window communications director David Hall says that,
in 2009, marketers will analyse costs very closely and choose the most
effective “cost-against-return” strategy. “Affiliate marketing absolutely
fits the bill because retailers pay commission to affiliates only after a
sale is made,” he adds.
Trends
Industry insiders insist that affiliate marketing will grow rapidly this
year because affiliates, marketers and consumers are all becoming
more sophisticated. Indeed, the affiliate sector is already giving off
positive signals, as larger European and US-based affiliate specialists,
such as LinkShare, settle in the UK. “We could see increasingly sophisticated
offerings and choices from retailers over the coming months.
They will move from their previous focus which was on aggregation
alone,” says Liane Dietrich, managing director of LinkShare.
However, affiliate marketers are under pressure to develop clearer
commercial policies. They are also expected to follow better use of
commissions and more active policing of areas in which affiliate activities
conflict with offline and other online channels. This is driven by
the increased assimilation of affiliate marketing into the online mainstream
as well as margin pressures on retailers.
Sophistication being the key, Existem Affiliate Management managing
director Mark Russell says there will be a shift towards a rationalisation
of affiliate programmes. “As budgets and spending plunge,
affiliates will need to create more scope for comparisons and provide
reasons to choose one brand over the other,” he says.
A renewed focus on customer service by affiliate marketers has
also been noted. “Customer experience has always been an important
factor in affiliate marketing, but there have never been any hard and
fast rules to govern it,” says Dietrich. The recent IAB code of conduct
“As budgets and
spending plunge,
affiliates will need
to create more
scope for
comparisons and
provide reasons to
choose one brand
over the other”
Mark Russell, Existem
Affilliate Management
for vouchers illustrates how customer service and experience is now
at the forefront of the affiliate industry.
Another trend that analysts predict will be an increased focus
around social media network and search giant Google. Hall at Affiliate
Window says: “Every year, Google has done something that has
changed the affiliate marketing model, from display URL restrictions
to removing the bidding restrictions on trademarks. In 2009, there
could be another major shake-up, this time facilitated by Google Social
Search.” According to the experts, such developments will enable the
search engine to serve more accurate and effective advertising. For
instance, incorporating user preferences within Google’s search algorithm
will enable pay-per-click (PPC) affiliates to develop ad strategies
that target very specific demographics.
Merchants will also seek exposure on true content sites with a
demonstrable audience. Traditionally,
the affiliate model
rewards the last referrer. However,
consumers often look for
products on a content site and
then go through a voucher code
or discount site for the best deal.
Even then, only a voucher code
affiliate earns the commission,
despite other factors being
involved in the consumer’s decision-making.
Hall adds: “We could
expect to see an evolution of the
CPA model to a multiple attribution
CPA system, whereby a number
of affiliates earn commission
from the sales generated.”
While vouchers and discount
codes are a positive trend, companies
do not rely on them
Marketing Week Interactive 19