When it comes to affiliate marketing, 2013 was quite an interesting year. Some of the biggest milestones included a record-breaking e-commerce holiday season, double-digit network growth, and the closing of the Google Affiliate Network. And let’s not forget about “Cookiegate,” which was sparked when Mozilla announced plans for its Firefox browser to block certain cookies.
As we look back on 2013, we can’t help but make educated guesses on what the next year will bring. While nobody can predict the future, a closer look at some of the more recent industry shifts and trends are a good indication of what we can expect in 2014.
Based on research and a review of more recent industry news, here are ten predictions for the affiliate marketing industry in 2014.
1. Mobile Commerce Will Test The Strength Of Affiliate Networks
There’s no stopping the mobile commerce train as experts at eMarketer estimate it will reach over $100 billion by 2017. Yet many retailers are losing out on m-commerce opportunities. According to a recent survey conducted by TheFind, 49 percent of shoppers say their biggest pet peeve related to tablet shopping is that retailers’ websites and apps aren’t optimized for tablets.
If they haven’t already, retailers need to quickly get up to speed and ensure their websites truly accommodate mobile consumers with features including fast downloads, easy and secure checkout, finger friendly interfaces, and support for the latest mobile platforms. From a performance marketing network point of view, seizing the m-commerce opportunities will require frequent, stringent and rigorous testing to ensure proper credit for transactions conducted on smartphones and tablets.
2. Advertisers Will Optimize Affiliate Marketing With Complementary Digital Marketing Channels
To maximize budgets and not over-saturate their target audience, advertisers will look to optimize their affiliate marketing efforts with other forms of digital marketing such as search, email and display. This way, they can get a better handle on the customer journey and gain greater visibility into which channels are driving and assisting conversions.
3. Luxury Brands Will Invest More In Performance Marketing
According to a recent Ipsos MediaCT study, affluent shoppers are spending more time and money online. Meanwhile, affiliate networks continue to report strong growth in luxury. While the opportunity is certainly ripe for affiliates to capture more of the luxury market, they must also be mindful that luxury brands are highly protective of their image and most have stringent brand compliance requirements. Therefore, publishers may find they need to meet an additional set of criteria in order to work with luxury brands.
4. Content Marketing Will Result In An Increase Of Niche Publishers Joining Affiliate Networks
By now, the entire digital marketing industry has gotten the memo that content is king when it comes to driving traffic and, ultimately, sales. This explains why 60 percent of marketers plan to increase their spend on content marketing over the coming year. Much like we saw with the success of mommy bloggers and fashion bloggers, the heightened focus on fresh, entertaining and engaging content for highly specific audiences is likely to create more opportunities for niche publishers in the affiliate channel.
5. Affiliates Will Drive Global Expansion For Online Brands
You’ve likely seen news from various performance marketing networks about overseas expansion. This makes sense when you consider that eMarketer estimates that global e-commerce sales will have exceeded 1.2 trillion in 2013. As online retailers enter new markets, many will continue to look to the affiliate channel to support their efforts. The pay-for-performance model allows them to access local knowledge and talent to test the waters before making significant capital investments in a new region.
6. We Haven’t Heard The last Of The Cookie Debate
While Mozilla has put its third-party cookie blocking efforts on hold, thanks in large part to the very vocal online advertising community and the IAB, this doesn’t necessarily mean the conversation is over. Mozilla is currently working with Stanford University’s Cookie Clearinghouse to potentially map out a more moderate approach to tracking third-party cookies. Since they’ve publicly stated they aim to have a plan in 2014, look for more on these developments in the latter half of the year though it’s not likely to raise the ire it did in 2013.
7. Nor Have We Heard The Last About The Affiliate Nexus Tax & The Internet Tax Freedom Act
History buffs may recall the Internet Tax Freedom Act, which was passed in 1998 and bars federal, state and local governments from multiple taxes on electronic commerce. The Act was extended in 2007 and runs until November 1, 2014. The current proposal is to permanently extend the Internet Tax Freedom Act. With that looming deadline and the grassroots efforts against the Affiliate Nexus Tax, look for online taxes to be an even hotter topic of discussion in 2014. For more in-depth and up-to-date information on the Affiliate Nexus Tax, be sure to visit the Performance Marketing Association‘s website.
8. Big Data Will Create Better Customer Experiences
With all the talk about Big Data over the past few years, 2014 is likely to be the year that we’ll see it more deftly applied across all marketing channels and throughout the customer journey. The brands that will emerge winners won’t necessarily be the biggest brands or those that invest most heavily in marketing or technology. Rather, it will be advertisers that use data to create engaging shopping experiences as well as publishers that attract shoppers with great, relevant content.
9. Brick-And-Mortar Retailers Will Find A Way To Better Manage Showrooming
Since showrooming is now the norm rather than the exception, expect retailers to come up with innovative ways to counter-balance the effects with great online-to-offline experiences that don’t disrupt existing sales models, including affiliates.
10. There Will Be Consolidation, Yet The Industry Will Continue To Grow
Much like we’ve seen in years past, we’re likely to see more consolidation in the affiliate marketing industry. However, don’t mistake this as a sign that the industry is slowing as Forrester predicts it will continue to grow as it reaches $4.5B by 2016.
I’d love to hear your perspectives on what the coming year will bring so feel free to add them in the comments section below.
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