What is affiliate marketing – The past, present and future

 

Affiliate marketing is one of the most efficient sources for driving new revenue and we want more people to understand it and use it successfully. In this new 3-part blog series we will share all there is to know for any affiliate marketing beginner in our overview of affiliate marketing. Other articles in this series are: What is affiliate marketing – Back to basics and What is affiliate marketing – The key players.

In the third part of this series we delve into the history of the affiliate channel, looking at where the channel started, where it is today and its opportunities for the future. To find out more about affiliate marketing and how you can drive a better affiliate marketing programme, you can download our free guide to better affiliate marketing today.

The evolution of affiliate marketing

The affiliate marketing model has been operating for over 20 years. Below we summarise the four generations of affiliate marketing that have bought us to the channel we know today.

Generation one – 1996- 2007

The first generation of affiliate marketing was characterised by a lack of regulation, limited best practice and an affiliate network centric model.

Generation two – 2008 – 2014

Generation two saw the rise of the “super affiliate” and later the decoupling of technology and services.

Generation three – 2015-2017

This generation was characterised by advertiser demands for a robust, flexible and future proof platform. This has led to a separation of technology and service and the rise of SaaS platforms. Non-traditional affiliates have successfully embraced the affiliate model, such as The Telegraph, Buzzfeed and magazines such as Condé Nast.

Generation four – 2018 and beyond

If we look at the channel today Affiliate Marketing will continue to grow, develop and adapt.

The future of the affiliate channel

Below are the key areas which we think will play an important role in the future of our channel.

1. Expansion of the affiliate model

Affiliate marketing is a model, rather than a channel. The model can be adapted and used anywhere. As marketing becomes more performance focused, the affiliate model will be used more widely by advertisers, as they look to increase efficiency and lower risk from their marketing activity.

2.Increased regulation

2018 saw the introduction of the GDPR in Europe and more stringent policies around disclosure in the US market which we expect to follow into Europe. Whilst this creates many challenges (particularly in tracking) it also creates opportunities for advertisers to increase consumer confidence by being honest and transparent regarding their marketing activities.  As a channel we should continue to lead the way in digital regulation and policy.

You can find out more about regulation in our UK guide to emerging affiliate models.

3. Adaptable tracking

With the introduction of ITP 2.0, Apple’s Intelligent Tracking Prevention and other browsers such as Firefox following a similar strategy networks and platforms will have to continue to adapt and innovate their tracking solutions in order to ensure that all affiliate marketing activity can be tracked accurately and safely.

The UK affiliate marketing industry is collaborating together to make sure key stakeholders are aware of the potential challenges and advertisers are being encouraged to update their tracking where applicable to ensure that affiliates are attributed fairly for the traffic they drive across all channel.

4. Better use of data

The affiliate channel has an abundance of data yet many advertisers, networks and platforms are using this in a limited way. This will change as advertisers want to better understand the value that each affiliate brings and how they can leverage data to drive more profitable growth through the channel.

5. Global affiliate marketing

The rise of SaaS solutions has meant that advertisers can run affiliate activity globally across one platform. As eCommerce borders continue to break down, and over a trillion dollars are expected to be generated through cross-border sales in 2020 advertisers will look at the affiliate programme from a holistic global view as well as on a local level.

To find out more about global expansion, read our guide to global expansion for brands on our blog.

That concludes our three part series “what is affiliate marketing. To learn more about the UK affiliate market and how to create a better affiliate marketing programme download our free guide today.

 

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