Last week, I listened to an interview with Hanan Mayaan on the Rick Magennis podcast. Hanan, the CEO and Co-Founder of affiliate data tool Trackonomics (a partner of FMTC), said something that struck me and stuck with me, that affiliate marketing might be “on the cusp of a golden age”.
His statement rang true to me, a twenty year industry veteran. Here is the case that he is correct.
First, a definition of Golden Age from the Oxford English Dictionary:
The period of greatest prosperity in the history of a nation, state, etc.; the most prosperous, successful, or favourable period experienced by a specified person, group, or community. Also: the time when a specified art or activity is at its finest, most advanced, or most popular.
Second, a definition of affiliate. Here there is no suitable OED entry, so I will offer my own:
An advertising channel with the placement negotiable if not negotiated between the two principal parties, an affiliate or publisher that displays a trackable advertisement and an advertiser or merchant that pays against a transaction, such as a sale or lead, most typically with a commission.
Affiliate stands apart from other channels as being neither “command-and-control” (deploying budgets for a certain number of clicks or impressions) nor anonymous (even if you don’t have a relationship with someone on the other side, you might, which is not the case with Facebook or Google or programmatic). Finally, affiliate is not really a branding channel; it falls on the direct response side of the spectrum, with the merchant generally calculating that an individual transaction will be profitable.
So let us say that affiliate marketing qualifies as a distinct group or community, eligible to have a golden age. What would make it soon, as opposed to decades ago (it’s been around since at least the 90s) or far away in an unknown future?
Clearly, affiliate marketing was not as advanced in the past, nor was it as popular. People often refer to the early days as the Wild, Wild West, usually because scammers got away with so many things, though as I shared recently on a podcast recording, there was also a sense of being able to strike it rich on a legitimate claim and that this time was temporary, that the frontiers would be settled, as they indeed were.
In terms of popularity, there were always lots of people in the space but for a long time it was hard to get the kind of corporate cooperation other channels enjoyed. There’s a lingering sense of resentment, captured in the intro of longtime affiliate marketer Jamie Birch’s podcast (yes, I listen to a lot of podcasts) “they said it wouldn’t last and they said that you can’t drive profitable and incremental revenue through the affiliate channel but here we are, twenty years later and the affiliate channel is alive and kicking”.
Nowadays affiliate is alive on the publisher side more than ever before. Here’s a recent testament quoted in The Strategist: “E-commerce, predominantly affiliate marketing, was sort of a focus of the company and now it’s come to the forefront,” Camilla [Cho, senior vice president of e-commerce at Vox] said “We’re seeing more emphasis, more resources, more aggressive goals and looking at ways to expand on what we’ve been doing. We’ve definitely hit on the gas pedal.”
This is not to say that affiliate will be at the forefront or even appropriate for every site, but that it is a mainstream channel. Consider that for a long time, a merchant-side marketer could be expected to explain their affiliate strategy, including if they don’t have a program. Soon, the same should be true for anyone responsible for publisher-side monetization. Consider that affiliate has a diverse base of publishers, including deal, reward, comparison, review, content, and, sometimes, influencer, among other models. Consider that you and most visitors don’t think twice of seeing an affiliate disclosure on a famous or unknown site like Wirecutter, WBAL.com, TimesUnion.com, BuzzFeed, or GQ. Consider that articles with titles like “How to Benefit From Affiliate Marketing” and Comparison Sites are a Growing Business frequently crop up on English-language sites around the world. Consider that another major acquisition was just announced today. Opportunity abounds.
That may sound fine, but if things are great over the next ten years, why not the ten years after that? Here, the answer seems to be that, in practical terms, something with enough success eventually fades in the background if it does not fade away and vanish. Think of the golden age of fifth-century Athens passing or how basic miraculous electricity is in our lives, such that we often give it little regard unless we’re desperate to charge our phones.
Closer at hand are the examples of Google and Facebook, which clearly do not enjoy the novelty or popularity they once had – Google is currently facing antitrust charges and Facebook an organized advertiser boycott (and Mark Zuckerberg a criminal referral). These companies might both continue to grow ever larger but it would seem their golden age has passed.
People will surely transact with each other for as long as there are people. With that will come advertising and with that, surely something like today’s affiliate advertising, whatever the technology looks like in a hundred or a thousand years. But what comes in the next ten years is likely to be our golden years – what a delight and opportunity to be here for it.