Affiliate marketing has become a vital inclusion in the marketing strategy for companies. Essentially, affiliate marketing is a process in which brands (or advertisers) use affiliate channels to advertise their products. Affiliates are also referred to as publishers. The affiliates use the brand website, product, service, or promotional links to prompt more clicks from potential buyers. Online bloggers, vloggers, or social media influencers are some examples of affiliates that a business can contact depending on their affiliate program. For instance, an adventure travel vlogger can provide product links of the touring accessories or travel websites used. These comprise of anything from their luggage to airline service, hotel room, or tour details. Once a potential buyer clicks on the specified link and completes a purchase, brands pay the affiliate a commission. Affiliate marketing is profitable for the brand and the affiliate.
During COVID, Affiliate marketing emerged as a cost-effective channel for brands, mainly because most consumers spend time online. Digitization of services has become the central theme for many businesses. Instead of visiting physical offices and stores, users have been content perusing websites for purchasing products and services in a leisurely manner. It has compelled brands to reconsider their core marketing concepts. Using in-house marketing tools solely might not be the best ploy to engage customers and generate leads anymore. Brands have to adapt to the changing buyer behavior and accommodate more effective affiliate programs into their marketing strategy.
Let’s take a closer look at why affiliate marketing is emerging as a cost-effective channel for brands during COVID-19. What are the significant factors causing brands to adopt this strategy?
Affiliates are compensated based on their performance and lead generation skills
As opposed to paying pre-determined rates for posting content online, affiliate marketing allows brands to pay a commission to affiliates on a performance basis. Brands avoid redundant expenses because they do not need to make a payment if there is no sale. This process reduces the overall expenditure on online marketing, and there is an emphasis on performance. Due to the impact of COVID-19 on revenue, brands are reluctant to allocate more funds to advertising. By making use of affiliates, brands are more focused on achieving their targets cost-effectively. With email inventories and email marketing affiliates, brands reach their audiences by sending out complete information and links to consumers attached with a persuasive title.
Consumers are not impressed by repetitive marketing content. They want variation, and more importantly, it is unique content that attracts them the most. In-house teams will find it challenging to come up with exciting slogans and campaign themes as often. Under these circumstances, affiliate marketing is emerging as a viable option to generate more revenue opportunities.
Being a result-oriented concept, Contextual Advertising is increasing brand appeal for audiences
Initially, online ad placements were based on analyzing and recognizing the browsing habits of consumers. For instance, if someone was browsing for laptops, it is assumed that they are looking to make a purchase eventually. Subsequently, they would see ads for similar or related products. When it comes to contextual advertising, ad placements are based on a person’s content views online. If they read articles about mobile phones, ads would be shown accordingly. It revolves around the fundamental interests a person displays through his/her browsing patterns. The ads also change when new content is viewed, so they are more relevant.
Google AdSense is one of the most popular tools for Contextual Advertising in the market. The service ensures that a brand’s product or service is highlighted fittingly with automated systems for placing ads.
The brand can generate more leads by using affiliates suitable to the business
A business can create more brand awareness through association with suitable affiliates. The audience base will increase considerably over a period of time by paying attention to the most effective channels. With the help of digital technology, it is not difficult to identify which affiliate channels have generated the most leads and conversions in any given period. Some bloggers or social media influencers are more skilled and innovative than others. They have an excellent comprehension of their audiences’ preferences, having built a rapport with them over time.
Brands conduct detailed analyses to point out which products or services affiliates have been most successful at promoting through their sites and blog posts. There is another effective option wherein brands partner with other companies having a similar audience base. By doing so, they can expand their scope and online presence mutually. In light of the COVID-19 spread and considering the limitations of traditional marketing channels, affiliate marketing has shown good potential to increase the ROI. Apart from maintaining the regular affiliate marketing channels, sourcing new ones through research are also important.
Here’s an example of how affiliate marketing can capture the attention of potential buyers suitably. The tourism industry has been one of the most affected, and the demand for products has slumped quite a lot due to the pandemic. People are skeptical about travel and booking accommodation, even for nearby tourist locations. A blogger can ease these worries to some extent by posting articles, pictures, or videos of their most recent trip to share the overall experience. Along with the health and safety tips, they can enlighten others about the restrictions in the jurisdiction and the safety protocols during COVID. Some users could find the information helpful and click on the links provided. When the user completes a sale, the blogger is rewarded for their effort.
During COVID, Affiliate marketing is emerging as a cost-effective channel for brands in these industries:
E-commerce brands can target a significant increase in sales by focusing on an affiliate marketing strategy. Potential customers are already spending more time online because of the health threats. Rather than depend on a search engine marketing strategy alone, adding affiliate marketing to the mix would be more effective in driving traffic.
2. Online Gaming:
The competition for online gaming companies has increased tremendously in the past decade. With virtual reality and augmented reality tools, gaming companies have gained much momentum. To maximize their reach to audiences, companies can use affiliate marketing.
3. Financial Services:
Rapid developments in the financial sector have driven the need for new marketing channels. With digital-only or neo-banking services becoming familiar, new and advanced marketing strategies will add to the attractiveness of financial services, getting the attention of potential clients when viewing a business or finance article.
We’ve seen how affiliate marketing is emerging as a cost-effective channel for brands. It is all about presenting information correctly to the right crowd when the opportunity strikes. Brands get to select from a widespread network of affiliates online, each one having an established audience. If a brand were to reach this extensive audience base, it would involve considerable investments in technology and resources. Even after these efforts, it would be challenging to monetize the technologies used. In all, affiliate marketing a suitable marketing solution during COVID-19. As companies are trying to minimize costs and yet increase demand for their products, affiliate marketing is one of the most optimum solutions in their repertoire.