Business owners and marketers are constantly searching for ways to make their brands more profitable and build customer loyalty. One effective solution is affiliate marketing--a powerful channel that continues to grow rapidly.
How Popular is Affiliate Marketing?
Marketers spent $2.7 billion on affiliate marketing programs in 2022, according to Coupon Affiliates. This number is expected to reach $15.7 billion in 2024 and surpass $27 billion by 2027.
In the past five years, Google searches related to affiliate programs have increased by 170%, and 80% of advertisers now say they run an affiliate program. This channel has not only reached the mainstream, but is clearly becoming a “must-have” for businesses.
Comparing Affiliate Sales to Other Channels
While sales and conversations are the ultimate goal for every company, other parts of the marketing funnel are crucial, too. Forty percent of U.S. businesses name affiliate marketing as the most effective channel for client acquisition, according to AuthorityHacker.
The sales generated by affiliate are significant too. Major brands report that up to 25% of their online sales result from affiliate marketing campaigns, AffiliateWP reports; 20% of marketers calling it their highest-performing sales channel.
Affiliate Marketers Only Pay for Results
One major advantage of affiliate marketing is the ability to control and measure costs. When advertisers engage publishers for an affiliate marketing campaign, compensation is directly tied to specific customer actions, such as clicks and purchases.
Common payment structures include:
- Pay-per-impression
- Pay-per-lead
- Pay-per-click
- Revenue sharing
The best payment structure for your business should be clearly measurable and related to your biggest business goals--our digital marketing experts can help you determine what that is.
Affiliate Marketing Reaches Highly Specific Audiences
One truism of search engine optimization (SEO) is that the highest ranking sites provide useful information to target visitors. Successful affiliate marketing campaigns are built on this same concept of utility. They leverage a trustworthy publisher’s domain authority with a highly specific audience to deliver useful products and drive conversions.
Determining your target audience to target requires you to develop a detailed understanding of your customer base—but you’re doing that anyway, right? With that knowledge, you can use an affiliate marketing platform to search for publishers with the specific audiences that match your customer profile.
Narrowing your target audience may narrow the overall impressions for your campaign, but advertising with an affiliate who has developed domain authority within a niche can boost your brand’s credibility and introduce your products to customers who are closer to making a purchase.
Learn more: Top 10 common affiliate marketing terms.
Affiliate Marketing Requires Attention
Entering the affiliate market doesn't guarantee success, but it does require effort. Given the potential for high revenue in a competitive environment, advertisers must effectively manage their affiliate programs. This includes monitoring existing publisher relationships, rooting out fraud, and recruiting new publishers. We've laid out steps for how to manage these processes in our convenient affiliate maintenance guide.
If this sounds like a lot of work, know that you don’t have to do it alone. You can rely on the expertise of the digital marketing experts at Informatics to harness this powerful marketing channel effectively. Reach out today!
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