05.01.2012 | by

Why Brands (and Not Offers) are the Future of Affiliate Marketing

Do you know how many $4 billion industries exist online? Neither do I. But by 2014, affiliate marketing will be one of them. And the year after that, worldwide online commerce will become a bloated $300 billion market.

For affiliate marketers, that’s plenty of opportunity, but the path to the future isn’t paved in gold and brightly lit. It’s rocky and crumbling at times. It runs into dead-ends and forks in the road. Simply, the path to the future of affiliate marketing isn’t the same one that got us to this point.

Where to Go From Here

affiliate brandingWith legal battles in more states and an online marketing environment that often discourages the affiliate marketing model, performance marketing is in desperate need of sustainability.

Affiliate offers come and go as quickly as fledging affiliates enter and leave the industry, and as more affiliate networks bow out, it’s clear that the core business model itself needs to be seen in a new light.

And that new light may be as simple as seeing where performance marketing fits within the online marketing ecosystem as a whole. Trends and changes that are seemingly unrelated to affiliate marketing may have a trickle-down effect, and for performance marketers to survive, they need to pay attention to what’s going on outside the affiliate marketing bubble.

Looking at the changes Google has made to its platform over the last three years, we see an emphasis on quality and relevance, both in respect to the consumer. So why not start there? Sustainability in affiliate marketing is dependent on quality, relevance and value. And more often than not, companies – rather than individuals, say bloggers, critics – provide these characteristics.

Turning Offers into Brands

Many times, affiliate offers resemble these things – they may seem to be high-quality, relevant campaigns – but they fail to deliver because they’re based on short-term gains and not long-term growth. This is the core problem: too many offers are created for quick profits. Networks and advertisers want to see offers set up quickly. They want to get straight to the traffic.

But this approach doesn’t always work. And when an offer dissolves, it leaves affiliates wondering what happened and advertisers scratching their heads as to why everything went south.

If traditional businesses approached their startup periods like this, their rate of success would be astronomically low. That’s why there are executive summaries and business schools and five-year business plans. There’s a tremendous amount of work that goes into building and branding a successful product, whether it’s a bank account, a book, or an affiliate marketing offer.

What if we took the same approach to performance marketing? We’d have offers turned into brands and campaigns turned into partnerships. We’d have sustainable, profitable products that were built on practical insight and held the consumer’s satisfaction as the ultimate objective.

We’d have brands of value, the type of products that could be relied upon for years without worry or stress. No Google update or upcoming social network would change our approach: we’d keep focused on the long-term goal.

Building Brands on All Sides of the Equation

This emphasis on brand-building can work for every side of the affiliate marketing formula. It’s most successful when it starts with an advertiser that builds a strong affiliate campaign around a branded, valuable product.

But it continues from there: affiliates can market their own endeavors in much the same way. Sites built on providing a branded experience – sites like RetailMeNot, FatWallet – offer value that doesn’t exist with an affiliate site that focuses solely on conversions and revenue.

Brands inherently grow because they’re recognized and built on reputation. Advertisers, affiliates and networks can build their brands and become reputable simply by changing their mindset from quick profit to long-term, sustainable success.

It’s a shift that requires an intense focus on providing real, practical value to a defined audience. And it’s a shift more marketers will be forced to make if they want to stay relevant in today’s affiliate industry.

Delivering Something of Ultimate Value

Verdict Research reported that along with the growth in ecommerce will come a 65% increase in money spent on luxury goods. Affiliate marketing and luxury good don’t always go hand in hand, but it’s clear that more than ever, consumers are looking toward high-end brands because they know it means quality, renown and status: everything someone wants to associate themselves with.

If you’re in affiliate marketing, you don’t have to deliver luxury goods to succeed. But you do have to provide a luxurious experience to the customer – making it as simple, easy and trusted as possible for consumers to get what they need online.

Affiliate brands deliver on this promise more than fly-by-night offers, and it’s these same brands that will take affiliate marketing into its next era.

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