Right off the bat, affiliate marketing is not in any way synonymous with digital marketing, and this has been somewhat confusing among most publishers regarding such debate.
Although both niches seem related since they are both within the eCommerce industry, logically, one actually existed earlier before the other, what do I mean? Affiliate marketing has always been an active career dating back to the 90s before digital marketing started gaining momentum.
In actual fact, digital marketing became rampant since social media obsession and the rave of smartphone technology that came simultaneously to perfect the interface and user experience of online platforms.
Establishing the difference between affiliate marketing and digital marketing is important in order to identify how the former has positively influenced the growth of the latter in the past decade. Digital marketing has decreased the use of traditional marketing to a fault, and have created multiple options to reach customers efficiently, giving affiliate marketers and even eCommerce retailers more tools and tactics to implement in increasing sales and ROI. These tools include: e-mail marketing, social media marketing, PPC campaigns, SEO/SEM, video marketing, etc., and these tools have saved marketers and retailers a lot of costs in advertising and promoting products.
The infographic below shows the different categories of digital marketing:
Indeed digital marketing has proved its influence on marketing, but how specifically have affiliate marketers utilized digital marketing to showcase its significance?
Content Marketing over Commercials
TV commercials, newspaper advertorials, and door-to-door marketing no longer interests affiliate marketers, and the influence of digital marketing has continually grown on practical business owners because of the focus invested in digital marketing by affiliate marketers.
“Content is king” is not merely cliché, it is the future of sales management and business marketing.
Affiliate marketers are content creators, either through email marketing, social media, or PPC advertising, and it is through content that prospects become leads, leads become customers.
Furthermore, affiliate marketing has impacted digital marketing immensely to where prominent online networks and search engines are now evolving their respective advertising platforms, e.g., Facebook ads manager, Google Adwords, Bing ad platform, LinkedIn ad platform, etc.
Diverse online marketing strategies through content creation have been embraced owing to affiliate marketing and the content created is not only targeted at making sales but to also educate prospects properly on how a product or service of interest works.
Increased Revenue for Digital Marketing Agencies
The more affiliate marketers make use of digital marketing agencies, the more revenue these agencies generate. Let’s examine some great examples and reports supporting this claim:
According to Business Insider, 15% of the total revenue generated by digital marketing agencies or digital media advertising is gotten from affiliate marketers.
Facebook made over 69 billion USD in ad revenue from its digital advertising platform (Facebook ads manager) in 2019. In the same year, Google made 135 billion USD from its digital advertising platform(Google Adwords). Average digital agencies in the United States generate over 17 billion USD annually from their B2B services to online marketers.
According to a CNBC report, the Interactive Advertising Bureau (IAB) conducted by PwC, said digital marketing revenue in 2018 was 21.8% higher than the 2017 revenue of $88.3 billion, meaning that it grew from 88 billion USD to over 100 billion USD. Newspaper advertorials decreased by 6.9% and magazine advertising fell 2.1% in 2018.
In summary, digital marketing agencies and social networks are making huge profit from their respective advertising platform because with more people embracing online marketing both for their practical business and strictly as an entrepreneurial career, affiliate programs would steadily increase, and agencies in digital marketing would yield more ROI, since it has become a confident strategy for brand promotion and awareness.
Reducing Digital Marketing Cost for Product Vendors and Retailers
Affiliate marketers have virtually taken away the burden of online promotion cost and expenses from product vendors and e-commerce retailers.
Amazon’s eCommerce success is basically attributed to the – low-cost of commercial advertising, made possible by its affiliate program.
The concept of affiliate marketing is to reduce capital investment and risks taken by product vendors and eCommerce retailers on advertising campaigns.
With this notion, eCommerce vendors and stores do not need to worry about ad spend on running social media marketing campaigns or SEM (Search Engine Marketing) , they prefer taking their chances with paying off affiliate commissions, because it holds more assurance of them selling more products than if they were to run any digital campaign themselves, plus it saves them time and effort.
The point, therefore, is that a business owner, product manufacturer, and retailer, expect higher revenue from digital marketing through their affiliates, without them investing much marketing capital and labor.
Easy Mobile Marketing
Indeed we can’t fully attribute the breakthrough of mobile marketing (digital marketing through mobile devices) to affiliate marketers, but it has had some positive influence on the matter.
Referring back to facts and figures, the percentage of Internet users on mobile devices have increased greatly in the past four to five years, over desktop users.
This has shifted the attention of online marketers to always include the demographic of customer’s who uses mobile devices for accessing the internet on regular bases.
This is not just mere coincidence, people find it easier to read or watch contents with their smartphones without having to be in front of a computer all day, and this has become an advantage for affiliate marketers to utilize digital marketing tools and automation software that can put their products in front of their audience through their phones, without having to bother about how such tools can suit a desktop interface.
However, when it comes to mobile marketing, e-mail marketing has proven to be a cheaper and better digital medium for acquiring leads or subscribers. Before then, bulk SMS was the strategy employed by online marketers and commercial industries to sell to their preferred audience. Although this hasn’t changed, such practices are gradually becoming extinct since e-mailing features can now be automated in form of autoresponders to reach a broader target, and 70 to 80% of individuals are comfortable opening e-mails through their smartphone applications, which makes more sense as to why mobile marketing has become easier.