Young man shopping via affiliate marketing in cafe

This article was first written by Rakuten Advertising’s APAC Director of Strategy and Marketing Samantha Deavin for AdNews

Affiliate marketing is one of the longest-standing digital channels in e-commerce, and over the years, has attracted a lot of misinformation. For a long time, affiliate marketing sat outside of the traditional marketing mix and was viewed with apprehension by CMOs.

Marketers typically viewed the affiliate channel as a strategy that could not efficiently and effectively scale, because advertisers are required to manually broker deals with publishers.

In the early days, the affiliate industry suffered when publishers played in the SEO space, manipulating results to drive traffic. Thankfully, content stuffing has long since been banished, but some advertisers remain concerned about the quality of affiliate marketing as a result of this chequered history.

But this is 2020, not 2000. Thanks to new advances in automation, the affiliate industry is in the midst of a complete evolution – and marketers who don’t jump on board are missing out.

Machine learning-powered tools are creating the perfect opportunity to bring new efficiencies to brands and publishers alike, and allow them to scale their affiliate marketing efforts well into the future.

Putting a price on affiliate marketing
Thanks to the absence of unified data, marketing departments have been forced to pursue a siloed, channel-first approach to managing their budget. Under these trying conditions, the true value of affiliate has been undersold – a ‘nice to have’, rather than a ‘necessary to have’.

However, as access to unified data has become increasingly available, CMOs are now taking strides to evaluate their digital marketing in a more holistic, collective fashion – and affiliate’s strengths are finally starting to shine.

The ability to offer different commission rates on different customer types, products or categories (alongside many other data points) is a major update to affiliate commissioning technology, that gives brands control of costs while offering complete transparently to publishers on how they might build their commissions.

The reality is, affiliate marketing is the only channel where commissions and spend can be directly tied to a retailer’s business goals in this way. It can align with actual business objectives: meaning better margins, new customer acquisition and a seamless consumer experience.

In today’s climate, every advertising dollar is scrutinised endlessly, and marketers need to know where their cash is going. In the new era of affiliate marketing, tracking those dollars is easier than ever before.

The benefit for publishers
As brands demand more from their affiliate partners, affiliate technology is evolving to help publishers create the infrastructure that can effectively leverage their high-quality audience data sets – something that’s critical for both audience and revenue growth.

The integration of a brand’s CRM data into affiliate platforms and the ease of publishers accessing this data via affiliate networks are helping publishers understand their user base and align their content to users’ specific preferences, catching their attention and influencing them to convert.

The introduction of multi-touch commissioning also means that affiliate marketing is no longer dominated by lower-funnel activity – the technology powering affiliate allows all publishers within the path to purchase be rewarded, creating new opportunities for both brands and publishers.

Significantly, this has opened up the affiliate space to content publishers, including some of the world’s biggest players, who are integrating content commerce as a new approach to revenue growth, and collaboration with brands.

The affiliate renaissance
It’s clear that both advertisers and publishers now have the tools and capabilities to innovate in the affiliate space – and the affiliate industry is primed and ready to cater to their demands. So what do they have to look forward to?

Scaling and automation tools mean that publishers can get better visibility to a broader range of advertisers, all while discovering new advertisers who value the publisher’s audiences. Gone are the days of personal relationships and a limited number of partners – technology such as Rakuten’s matchmaking tool allows for more reach than ever before.

On the other end of the spectrum, AI-powered matchmaking tools provide publisher recommendations to retailers based on past performance history with other advertisers. No more unscrupulous partners or brand safety risks.

Personalisation is now an exciting possibility within affiliate, too. Personalisation allows retailers to deliver the right message to consumers at the right time by accessing unique insights from consumer browsing and shopping data – within the parameters of data privacy regulation, of course.

With the introduction of GDPR in Europe in 2018, and the California Consumer Privacy Act of 2020, data privacy is on everyone’s radar. AI-powered affiliate technology and tools mean advertisers will have better control over the quality of compliant data, ultimately leading to a better end-user experience

There’s no denying that affiliate is one of the most effective channels in the marketing mix. In a climate where every dollar is being scrutinised and every penny pinched, it’s an essential component of any advertisers or publisher’s strategy.

Speak to our team of experts today to find out how Rakuten Advertising can help your affiliate program scale.