Affiliate marketing makes a great passive revenue generator and the perfect way to build brand awareness. But if it’s as easy as it looks, everyone would do it.
While it’s true that it’s lucrative, it’s also true that it requires a greater upfront investment of time and money. Here are the latest stats that speak to the market, the most effective angles to take, and why everyone is doing it.
You heard that right. $20 billion and climbing, according to the report by Astute Analytica. They do expect this market size to double over the coming years, estimating the industry will reach nearly $40 billion by 2031.
This data shows that affiliate marketing isn’t going anywhere, and affiliates are a valuable partner to brands that want revenue, as well as to consumers who want reviews and testimonials before making a purchase.
81% of advertisers and 84% of publishers use affiliate marketing programs as a source of revenue, according to a study by Rakuten/Forrester Research. And why do they do it? Affiliate marketing helps companies reach a larger audience, drive new leads, and lock down new revenue without spending much on ads or an outside marketing company.
E-commerce is a gigantic market, of course, and affiliate marketing makes up a significant piece of the pie. According to DemandSage, 16% of all online orders in the United States come from affiliate marketing.
Most, if not all of e-commerce stores promote products and services online and through social media. By utilizing affiliate marketing, they’re expanding their customer reach and growth on that front.
Which industry is king within the broader affiliate market? While many popular industries include hobby, technology, and fashion, it’s health and wellness that takes the top spot.
According to Statista, this niche is worth over $6.32 trillion, covering dieting, fitness, organics, medicine, and more.
Customers want to make purchases based on reviews and testimonials can trust. The data from PowerReviews supports this claim. According to a recent study, 9 out of 10 shoppers trust customer reviews over the brand’s own advertising.
This is why businesses and brands need to pay close attention to their online reputation. Affiliates are the most effective way to grow a neutral or negative reputation into a glowing one.
There are many ways brands pay their affiliates. They could compensate them with merchandise, a flat one-time rate, or payments per impression.
The most popular method of payment, however, is the simplest and rewarding option for both parties. 99% of programs, according to IAB UK, pay on a cost per action (CPA) basis. This means whenever someone makes a purchase through an affiliate link, the affiliate gets a cut.
This is the most concrete way to confirm the affiliate’s ROI and the best way to incentivize affiliates to get their audience to complete the checkout process and convert.
Who isn’t addicted to their phone these days? Awin recently released a survey confirming that over 50% of people visiting affiliate websites do so from a phone or tablet. That’s why brands need to ensure their websites run smoothly, look slick, and are simple to purchase from. It takes the affiliate push to get them to the site, but from there, it’s up to the brand to make the mobile site friendly and accessible.
Coupon giant Groupon is a famous brand that uses affiliate commissions to run the business. Reaching its peak in 2016, according to Statista, Groupon earned a cool $3 billion that year, but has since seen a decline.
In 2023, the company made $515 million. It’s still a significant amount of money, but it demonstrates that consumers are opting for a less consumption-heavy, more purposeful and trustworthy approach to buying.
For most, affiliate marketing is just a side gig. Just like it’s an extra revenue stream for your business, it’s passive income for the affiliate. But according to PayScale, the average base salary for an affiliate in the US is $56,141. This is based on reported salaries from those working in the field, also taking into account years of experience and education.
When it comes time to draw in new affiliates, tell them that it could be some extra pocket money or a flourishing career if they so choose to put the effort in and build it up.
Finding the affiliates for your new or growing program might be the most daunting part. However, according to QR Code Tiger, joining an affiliate network community is like shooting fish in a barrel. According to them, 83% of brands and publishers find affiliates to partner with through these networks.
Networks help connect brands to affiliates who are already experienced with affiliate programs. It saves time in recruiting and training them on how to promote your products, but also gives affiliates the chance to vet potential brand partners better. It’s a win-win for everyone.
Aside from joining an affiliate network, there are other ways to go about finding affiliates and starting your program. Brands also often try:
Try a combination of methods to get the best results. Recruitment doesn’t have to be difficult. With a well-rounded approach and some dedicated research, you’ll be partnered with affiliates perfectly aligned with your brand in no time.
At Simple Affiliate, we support affiliate marketing programs of any size and make it, well, simple. We offer KPI tracking, comprehensive dashboards, automated tax forms and payouts, and everything you could need to manage and scale your program.
Book a demo with the team today, and we’d be happy to show you just how easy (and lucrative) your affiliate program could be.
