About a week ago, e-commerce behemoth Amazon announced that they’d be slashing publisher commission rates used by their popular affiliate program.
These decreases in rates (which on the higher end are at around 70%) would take effect yesterday, April 21.
So, let’s get to the meat and potatoes here. Why does this matter and who’s affected? Well, this is huge.
The main group affected here is the affiliates. The affiliates that, over time, have honed in on how to maximize profits for the brands they promote and themselves will now be faced with the harsh reality of a 70% payout reduction. In many cases, these campaigns they had in place will become unprofitable.
Of course, the other affected party are the advertisers they were promoting, which will now be relying primarily on organic traffic generated within the Amazon ecosystem, as opposed to performance driven contributions.
Amazon is a dinosaur when it comes to our space; a very old, very big, and very slow dinosaur. Given their sheer size and name, they tend to be one of the first affiliate networks emerging affiliates flock to when looking to begin their cost per acquisition marketing career.
However, as most top producing publishers eventually find out, there are many restrictions and limitations that come with deciding to use Amazon as one’s main affiliate network for generating income and running campaigns.
We predict these affiliates will begin to expand their horizons to find new affiliate networks. And, we think, they won’t look back.
With exceptional networks like CJ, Rakuten, Pepperjam, ShareASale, AvantLink, and, even Impact, affiliates will have their hands full of top tier advertisers to choose from and bleeding edge technology to assist their campaign tracking.
Not only are they already facing an existential threat in the form of the global pandemic lockdowns, but during this time Amazon has actually been profiting, with its stock value increasing even in the face of COVID-19.
When pondering the real reason for the reduction in Amazon’s need for affiliate traffic, we can only speculate. Was it profit based? Need based? A combination? Either way, they are one of the few, possibly only, online shopping juggernauts that are truly branded worldwide and need little assistance from third party marketers (affiliates).
Either way, our team is available to assist these lost affiliates in finding a home for their traffic, new brands to promote, and recreating a sustainable revenue source once again.
Working with the right partners right now in the affiliate space can actually benefit merchants even during a time of international crisis. As we’ve covered before, digital marketing – and specifically the affiliate channel – offer the ability to reach customers while they continue to look to enhance their lives, even in quarantine from the Coronavirus.
Of course this is not an attack on Amazon. They’ve got to do what they’ve got to do. But if you’re looking for support right now, give us a call or drop us a line. Advertise Purple is here to level the playing field for brands of all shapes and sizes.
If you have been affected by these Amazon cuts or even if you don’t have an affiliate program in place, reach out to us at [email protected]. We’d love to work with you. Best of luck out there, and stay safe!