The Leaky Bucket, The Hall (of Mirrors), and the Death Star

Written by Brook Schaaf

Affiliate marketing is a leaky bucket. The hand-lifted bucket symbolizes the relatively small revenue volume the channel can funnel compared to other channels. By the PMA’s survey, the best source of data I’ve seen, affiliate marketing in the U.S. totaled about $14 billion in 2024. (See below for comparison channels.) 

The hole in the bucket, dear Liza, symbolizes the fact that the channel will rarely, if ever, overtrack. For all the complaints about last-click tracking, for which there is no superior alternative without its own trade-offs, not all clicks even track. The user may thwart tracking in various ways, such as switching devices or apps or purchasing outside of a cookie window. Merchants may have their tracking misconfigured or deliberately sabotaged. And this is assuming there is a click to begin with, which is ever less likely in the zero-click / AI Overview era.

Open-web programmatic advertising, by contrast, is a hall of smoke and mirrors. As a magic trick, it’s pretty impressive, having conjured up about $50 billion in the U.S. in 2024. Not only is this multiples larger than all of affiliate marketing, but most of this money is probably misspent. In the same year, DoubleVerify estimated a 71% “Authentic Viewable Rate.” A 2023 study by the Association of National Advertisers estimated that 35% of a typical spend suffered from “loss of media productivity,” i.e., waste because of non-viewability, non-measurability, display on a made-for-advertising (MFA) site, or another problem. And the value proposition still presumes that these impressions register in the brains of real people. Have you ever even clicked on an OWPA ad on purpose? How often do you even see or know the brand? Takeovers on the mobile sites I visit aren’t even well-targeted. They are nothing I’ve bought in the last five years or am likely to buy in the next five.

Finally, we have the walled gardens of Google, Meta, and Amazon operating collectively as the Imperial Death Star. According to Quo Vadis, these three accounted for $83, $53, and $38 billion in search and media retail revenue in the U.S. in 2024. So why does this make them the Death Star? First, the walled gardens are massive in size. Second, they have the power to destroy the open web by taking up all the advertising dollars. 

Yes, yes, I know what you’re thinking. If the walled garden imperium sucks all of the oxygen out of the air, then wouldn’t Spaceball’s Mega Maid vacuum be a better metaphor? She would, except that this is no laughing matter. Moreover, I need to prepare for our upcoming Star Wars trilogy ahead of May Force day. More to follow.