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April 13, 2022

How the Pandemic Changed Affiliate Marketing Forever

By Alex Cramer

Do you ever scroll back on your timeline and look at your life from before Covid?  Just so you could reflect on a time when you didn’t have a year’s supply of hand sanitizer in your closet or a stack of masks in your glovebox.

Do you ever think about the person you were then and how much the entire experience of just living through the last two years has changed you? Which of those changes will be with you forever and which will go away with the virus?

At Advertise Purple, that’s an idea that we consider all the time because we know that we’re not the same company we were before Covid happened and neither is our industry.

Let’s start with the big picture. Back when we were wiping down our Amazon packages with Lysol and trying to figure out if Carol actually fed her husband to a tiger, we also spent a lot of time buying things online. According to Statista, from 2019 to 2021, global e-commerce spending exploded from $3,351 billion to $4,938 billion.

And that growth hit affiliate marketing in a big way. In that same time period, US spending through affiliate marketing grew by over one billion dollars.

But now that Covid is (we think/hope/pray) receding, will the growth we’ve seen in affiliate marketing fall back, or are we living in a new normal where multi-billion dollar growth is the norm?

To get a better insight into the situation, we spoke with Cary Pierce, Director of Agency Services for Rakuten Advertising, one of the largest affiliate networks in the world and a key strategic partner for Advertise Purple.

“So two years ago, when the pandemic hit,” Cary told us, “many of the conventional marketing companies and conventional advertisers paused or completely shut off their marketing budgets. Some even canceled everything associated with any marketing spend. That left a lot of content sites with dedicated audiences and little to no way to generate revenue.  They needed a new way to monetize their content. That’s when they realized that to make money, they had to get into affiliate marketing and that’s exactly what they did.”

So far that all makes sense. I mean the billion-dollar growth has to come from somewhere and adding thousands of new publishers to affiliate-networks will definitely do that. But the real question is will they stay as our lives return to some version of normal or will they turn back to more traditional advertising?

Cary had a first-hand perspective on this when his own affiliate network was suddenly flooded with new publishers.

“Within the first two months that the pandemic took effect and everything shut down, we had a massive influx of publishers into the network. More so than we’ve ever had. And, right now, those same publishers have advertisers coming back to them, wanting to get their ads back on their site. And the publishers are saying ‘Sounds great. We’d love to write an article about your new shoe or your new camera or whatever it is. What’s your affiliate program?'”

Once publishers realized how effective their affiliate programs were, and how much more control they had over them compared to external ad budgets from agencies, they understood that they needed to make affiliates a core part of their revenue strategy.

“The publishers are not going to just take cash for simple exposure anymore,” Cary continued. “They want to know what your affiliate program is before they just publish any ol’ thing.  So there’s been a wider acceptance, not just from agencies, but from publishers now understanding that in order for them to protect their investment going forward, they need the security of continual revenue. They can’t rely on a CMO’s marketing budget or if that same CMO has a shift in strategy next year. So now they have content that they can monetize with affiliate continually because the ads come and go but that affiliate link lives forever on their site.”

There’s a lot to be said about the reasons for the growth of affiliate programs, and Cary hit on a number of the most important ones, but if you want to boil the entire thing down to one simple idea, it’s that affiliate marketing is growing because publishers understand that it works. And that’s also why the market will continue to grow even as Covid recedes.

Publishers may have adapted to affiliate programs out of necessity, but they are going to keep those programs going because of the success they’ve had and Advertise Purple will be right there with them to help their programs grow.

Are you getting started in affiliate marketing or looking to improve your current program?

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