During the pandemic, many shoppers have steered clear of stores and malls and redirected their shopping from offline to online. Because of this, 2020 saw more money poured into affiliate marketing than ever.
And this trend looks like it’s set to continue, especially as people grow more comfortable with the idea of online shopping. The numbers back it up:
- In the U.S., 15% of digital marketing revenue is being put into affiliate marketing.
- 80% of brands use affiliate marketing as one of their sales models.
- Statista predicts affiliate marketing spending will reach $8.2 billion by 2022.
Going forward, brands have an abundance of opportunities in the affiliate marketing space. 2021 is a new beginning for most — so let’s dive into some affiliate marketing trends for 2021, along with a few tips that will help you grow your affiliate revenue this year.
1. Affiliate Marketing Will Gain Popularity in the B2B Space
Affiliate marketing is making a name for itself in the business-to-business (B2B) world. B2B marketers are taking advantage of the method’s access to groups of potential buyers who were previously somewhat difficult to reach and convert through other advertising and sales methods. For example, perhaps a large portion of one market is averse to traditional selling methods. They never answer marketing emails or pick up cold calls, but they might read a lot of content.
To illustrate affiliate marketing’s B2B effectiveness, pretend a company sells a sales tech solution and its target market consists of B2B salespeople. Perhaps there’s a website dedicated to helping B2B salespeople grow their skill sets and find answers to their questions. In that case, the company’s program manager might contact this website’s owner about becoming an affiliate for their company’s product or service.
While these salespeople are reading content from a source they trust, they might come across a mention of the sales tech company’s service and decide to check it out. Websites for B2B professionals — where the articles are the product — are popping up all over the internet. So it pays for affiliate program managers to find some that are directed toward their target audience.
2. Social Selling Will Outshine Email Outreach
The vast majority of affiliate recruitment to potential affiliates is done through direct cold email, but this technique is losing its effectiveness. Affiliate marketers, bombarded by email messages, are starting to feel that this type of outreach is more like freezing than simply cold.
Therefore, affiliate program managers need to warm up their outreach if they want to land the best partners for their product or service. They can do this through social selling: a selling technique focused on building relationships with potential affiliate marketers through social platforms such as LinkedIn, Twitter, or YouTube.
They can do this by:
- Commenting on the affiliate marketers’ posts.
- Sharing interesting content with them.
- In-messaging them on LinkedIn.
Another way for program managers to recruit affiliates through social selling is by promoting their blog posts, guides, and videos across different social platforms. This will lead to better brand recognition from top affiliate marketers in their niche. And as familiarity grows, so will these affiliate marketers’ desire to promote that product or service.
If program managers start enacting a social selling methodology now, they can plant the seeds for more efficient partnership expansion over time.
3. Influencers Will Become Integral
Now, more than ever, consumers are wary about being sold to. They understand the manipulative forces at play in advertising, and therefore would rather buy from someone they trust — someone they know has their best interests in mind.
In other words, they buy from influencers. So it makes sense for affiliate program managers to add some of these influencers to their program. Influencers who produce helpful, unique content for their viewers and have a loyal following can add credibility to a brand.
Because of the incoming demand for these influencers, it’s best to start building relationships with them early, whether that means sending them a free product sample or commenting on their social media posts. Also, managers need to focus on influencers who fit their brand and would actually use their products or services. Otherwise, the selling seems forced — something buyers notice.
4. Customers Want Video When Making Buying Decisions
According to Wyzowl’s video marketing report, 84% of people in a survey said a brand’s video had convinced them to buy a product or service. And 74% say a video has convinced them to buy a piece of software or an app.
In 2021, consumers will want to buy products and services for which they have a strong understanding. With COVID-19 continuing to hurt people’s incomes, consumers don’t want to buy online solutions that they can’t see in action. For example, if buyers purchase a backpack, they’d like to see a video of people wearing it or hiking with it.
To help consumers learn about the product, program managers should create videos and instruct their partners to use them when promoting or mentioning the product. They can begin with explainer videos — or if they’re selling software, a short demo of the tool with a voice-over covering the most popular functions and benefits.
On the other hand, managers can rely on their affiliates to create videos for them. They can partner with YouTube influencers who produce video content to review products and services for their loyal audiences.
5. The 20-60-20 Model for Affiliate Program Management
The age-old 80-20 principle — where affiliate program managers expect 20% of their partners to produce 80% of their results and therefore deserve 80% of their management time — will fade away. Equipped with better niche data, managers will be better able to make decisions about whom they partner with, allowing them to build a healthy and diversified affiliate program.
And the 20-60-20 model for managers will replace the 80-20 principle:
- 20% of their time managing and supporting their top publishers
- 60% of their time growing a set of active traffic sources to the body of their program
- 20% of their time nurturing relationships with the smaller, long-tail affiliates
Lee-Ann Johnstone, CEO at Affiliate Insider, says this formula works well because it “can help brands ensure affiliate programs are operating at optimal levels while mitigating heavy reliance on single traffic sources such as voucher code or SEO sites that could change direction based on a number of external and competitive factors.“
The 20% dedicated to smaller affiliate marketers helps brands avoid putting all their eggs in one basket. This lack of diversification is advised against in normal times, and even more so in periods of such unpredictability as 2021. Plus, some of those smaller affiliates might just remain small for now. They’re trying to grow their influence, and over time they might succeed, bringing their affiliate programs along for the ride.
6. Localization Will Help Win More Customers
Localization is the process of learning a customer’s culture and marketing within its standards and expectations. Customers are more likely to buy from affiliates who understand their problems, worldviews, and customs.
So as brands expand their programs into new communities and demographics, whether that be a technologically emerging country or a new industry, they should focus on working with partners who understand the nuances and terminology of those populations.
If brands work with affiliates that lack a trusted voice in the sub-group or community, the brand might lose credibility and miss out on opportunities to win leads and sales.
7. Emphasis on More Long-Term Collaboration
Program managers are focusing on growing relationships with their current influencers and affiliate partners. That way, the partner can get to know the brand and offerings and be better equipped to explain products and services — especially complex ones like Software as a Service (SaaS) — to their audience.
Affiliate managers can grow these relationships and build loyalty by consistently sweetening the pot for their partners. For instance, they can reward them for their hard work and success through yearly commission bumps.
Not only will this create a lasting relationship and prevent your affiliate partners from favoring another company’s program, but it will also incentivize them to put more of their marketing efforts into selling your solution.
The Future Is Filled With Opportunity
The future of affiliate marketing is promising. Buyers want to interact with brands in meaningful ways. More informed and effective sellers are emerging on the scene, and the channels of communication continue to grow — TikTok being a prime example. Plus, new technologies are helping affiliate managers grow their programs, thereby increasing revenue.
One technology helping program managers is LeadDyno, which allows you to set up an affiliate program in just minutes. Through the tracking software, you can manage your affiliates and their payouts quickly and efficiently. And you can learn which online marketing channels are working the best so you can intelligently allocate your online advertising budget going forward.
If you need help growing and managing your affiliate program, check out how LeadDyno can assist.