Is Affiliate Marketing
Merely an “Alternative”?
Geno Prussakov
CEO & President, AM Navigator LLC
www.amnavigator.com
Found...
 Affiliate Marketing is…
 State of the Industry
 Trends & Opportunities
Outline
Affiliate Marketing is…
The Definition
...performance-based marketing, whereby affiliates
promote your product/service & get compensated
for every...
Who Are “Affiliates”?
 “The term „affiliate‟ means any company that
controls, is controlled by, or is under common contro...
Who Are “Affiliates”?
Affiliates:
Independent marketers
who may choose to
promote a business,
and be paid on
performance-b...
So Affiliate Marketing is…
... “the art of doing a merchant‟s
marketing better than they
can, and profiting from it.”
Chri...
How Much Do They Make?
Source: Darren Rowse, The Ultimate Guide to Making Money with the Amazon Affiliate Program,
ProBlog...
January-September: 13,000 UVs/mo
October: 95,000 UVs
November: 2,000,000 UVs
How Much Do They Make?
“Amazon ...derived about 40% of its sales from
partners participating in their “Associates”
program.”
Source: Siegel M. & ...
Affiliate Marketing ≠ Channel
“…but, rather, a way of remunerating a marketer…
hence, affiliate marketing really exists on...
Affiliate Marketing ≠ Channel
It is integral to understand this for ensuring
proper/healthy co-existence (not conflicting,...
State of the Industry
Size of the Industry (US)
• Advertiser/merchant count: 10,000+
• Publisher/affiliate count: 1,000,000+
• Spend: ≈$3,000,00...
Size of the Industry (UK)
• UK advertiser/merchant count: ~3,000-4,000
• UK publisher/affiliate count: ~10,000
• Impact sc...
Size of the Industry (Russia)
Source: AdLabs.ru estimates & forecast, as quoted by a CPA Club Russian Facebook group membe...
Trends & Opportunities
From hype to reality:
 Attribution (improvements in tracking &
reporting; e.g.:
AvantMetrics, ImpactRadius, PHG, TagMan, ...
Opportunities in Evolving
Affiliate Marketing Landscape
See video from:
http://www.youtube.com/watch?v=5f6ievv-70E
Opportunity #1: Mobile
Opportunity #1: Mobile
 Set to eclipse desktop by 2014
 71% of smartphone owners shop on mobile
Opportunity #1: Mobile
 Mobile sales = 11% of ...
Opportunity #2: Social
Source: BIA/Kelsey, April 2013
 Social shopping
Opportunity #2: Social
 Social shopping
Opportunity #2: Social
 Social shopping
 Social gaming (warning: doesn‟t work w/ PPL)
 Podcasting
 Q&A and review websites (in US: disclosure...
“The total value of the global real-time mobile
location-based marketing and advertising market
will grow from € 192 milli...
 Offline performance marketing (e.g. PPCall)
Opportunity #3: Local
Source: RingRevenue.com
 Offline performance marketing (e.g. PPCall)
 Local search
 Geo-targeted advertising
 Mobile- and social-related oppor...
Instead of a Conclusion
Perhaps the most important part of offensive
basketball is the part played by each man without
the ball.
~ John Woden, Nai...
Perhaps the most important part of offensive
basketball is the part played by each man without
the ball.
~ John Woden, Nai...
Is Affiliate Marketing Just an Alternative? (Basics, Size, Trends, Opportunities)
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Is Affiliate Marketing Just an Alternative? (Basics, Size, Trends, Opportunities)

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Geno Prussakov's presentation on whether affiliate marketing is "merely an alternative" (to other channels of online marketing). Presented on June 27, 2013 at Search Marketing Day in Poznan, Poland

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Is Affiliate Marketing Just an Alternative? (Basics, Size, Trends, Opportunities)

  1. 1. Is Affiliate Marketing Merely an “Alternative”? Geno Prussakov CEO & President, AM Navigator LLC www.amnavigator.com Founder & Chair, Affiliate Management Days www.affiliatemanagementdays.com (+1) 888-588-8866 geno@amnavigator.com @ePrussakov .
  2. 2.  Affiliate Marketing is…  State of the Industry  Trends & Opportunities Outline
  3. 3. Affiliate Marketing is…
  4. 4. The Definition ...performance-based marketing, whereby affiliates promote your product/service & get compensated for every customer/lead referred.
  5. 5. Who Are “Affiliates”?  “The term „affiliate‟ means any company that controls, is controlled by, or is under common control with another company” /Compilation of State and Federal Privacy Laws, 2002, p. 76/  “The term „affiliate‟ can be used as a generic word to indicate either a subsidiary or division” /Business information: how to find it, how to use it, 1987, p. 38)  Terms “affiliate and subsidiary” are “used synonymously” /International dimensions of management, 1989, p. 2/
  6. 6. Who Are “Affiliates”? Affiliates: Independent marketers who may choose to promote a business, and be paid on performance-based arrangement. Types: i. Content (Answers.com) ii. Coupons (RetailMeNot) iii. Data feeds (Shopzilla) iv. Display (Forbes.com) v. Email vi. Loyalty (TopCashBack) vii. Mobile viii. SEM (SEO & PPC) ix. Social Media x. Video
  7. 7. So Affiliate Marketing is… ... “the art of doing a merchant‟s marketing better than they can, and profiting from it.” Chris Sanderson, AMWSO
  8. 8. How Much Do They Make? Source: Darren Rowse, The Ultimate Guide to Making Money with the Amazon Affiliate Program, ProBlogger.net, 4/24/2013 Note: The y-axis reflects shows earnings in USD
  9. 9. January-September: 13,000 UVs/mo October: 95,000 UVs November: 2,000,000 UVs How Much Do They Make?
  10. 10. “Amazon ...derived about 40% of its sales from partners participating in their “Associates” program.” Source: Siegel M. & Gibbons F, 2008, Stanford University, Amazon Enters the Cloud Computing Business, p. 6 How Much Business They Bring? Our experience: 20%-40%
  11. 11. Affiliate Marketing ≠ Channel “…but, rather, a way of remunerating a marketer… hence, affiliate marketing really exists on the crossroads of a number of online marketing channels and works with nearly all of them.” Source: Affiliate Program Management: An Hour a Day (p. 24) It is a marketing context, based on the principle of performance-based compensation.
  12. 12. Affiliate Marketing ≠ Channel It is integral to understand this for ensuring proper/healthy co-existence (not conflicting, or cannibalizing, but complementing) of affiliate program with all channels of marketing that the merchant is employing.
  13. 13. State of the Industry
  14. 14. Size of the Industry (US) • Advertiser/merchant count: 10,000+ • Publisher/affiliate count: 1,000,000+ • Spend: ≈$3,000,000,000
  15. 15. Size of the Industry (UK) • UK advertiser/merchant count: ~3,000-4,000 • UK publisher/affiliate count: ~10,000 • Impact scale: ~100 million transactions, and ~70 million leads • Scale: 7-9% of UK online marketing spend; ~6% of the UK Internet economy; .6% of GDP • Growth: since 2008 UK affiliate marketing has registered an average 12% YoY growth Source: PriceWaterhouseCoopers study commissioned by the Internet Advertising Bureau UK, January 2013
  16. 16. Size of the Industry (Russia) Source: AdLabs.ru estimates & forecast, as quoted by a CPA Club Russian Facebook group member $2.4 million 2003 → $65.6 million in 2012
  17. 17. Trends & Opportunities
  18. 18. From hype to reality:  Attribution (improvements in tracking & reporting; e.g.: AvantMetrics, ImpactRadius, PHG, TagMan, et c)  Video (tools; e.g.: ShareASale, Coull, Viewbix)  Offline (bridging the online/offline gap; e.g.: RingRevenue, mobile-to-store campaigns, etc) Trends
  19. 19. Opportunities in Evolving Affiliate Marketing Landscape See video from: http://www.youtube.com/watch?v=5f6ievv-70E
  20. 20. Opportunity #1: Mobile
  21. 21. Opportunity #1: Mobile
  22. 22.  Set to eclipse desktop by 2014  71% of smartphone owners shop on mobile Opportunity #1: Mobile  Mobile sales = 11% of e-commerce sales (2012), 15% (2013), 18% (2014) 21% (2015), 24% (2016) Sources: Morgan Stanley, Skava, Branding Brand, eMarketer
  23. 23. Opportunity #2: Social Source: BIA/Kelsey, April 2013
  24. 24.  Social shopping Opportunity #2: Social
  25. 25.  Social shopping Opportunity #2: Social
  26. 26.  Social shopping  Social gaming (warning: doesn‟t work w/ PPL)  Podcasting  Q&A and review websites (in US: disclosures)  Social media ads  Proactive conversation design Opportunity #2: Social
  27. 27. “The total value of the global real-time mobile location-based marketing and advertising market will grow from € 192 million in 2011 at a CAGR of 91 percent to € 4.9 billion in 2016.” Source: Berg Insight, Location-Based Advertising and Marketing, May 2012 Opportunity #3: Local
  28. 28.  Offline performance marketing (e.g. PPCall) Opportunity #3: Local Source: RingRevenue.com
  29. 29.  Offline performance marketing (e.g. PPCall)  Local search  Geo-targeted advertising  Mobile- and social-related opportunities (e.g. proximity-based location marketing, check-in services) Opportunity #3: Local Key: be relevant (here and now)!
  30. 30. Instead of a Conclusion
  31. 31. Perhaps the most important part of offensive basketball is the part played by each man without the ball. ~ John Woden, Naismith Hall of Fame Coach One of the most difficult coaching tasks is to teach players to carry out actions that don‟t involve the basketball — the magnet of the game. ~ Krause, Meyer & Meyer, Basketball Skills & Drills Moving without the ball requires you to be adept at starting, stopping, faking, and changing directions. You must have excellent court awareness and vision… ~ Ralph Pim, Winning Basketball Self-Educate to Survive Succeed!
  32. 32. Perhaps the most important part of offensive basketball is the part played by each man without the ball. ~ John Woden, Naismith Hall of Fame Coach One of the most difficult coaching tasks is to teach players to carry out actions that don‟t involve the basketball — the magnet of the game. ~ Krause, Meyer & Meyer, Basketball Skills & Drills Moving without the ball requires you to be adept at starting, stopping, faking, and changing directions. You must have excellent court awareness and vision… ~ Ralph Pim, Winning Basketball Self-Educate to Survive Succeed!
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