Affiliate marketing is a type of performance-based marketing in which a business rewards one or more affiliates for each visitor or customer brought by the affiliate's own marketing efforts
Digital marketing planning is a term used in marketing management. It describes the first stage of forming a digital marketing strategy for the wider digital marketing system. The difference between digital and traditional marketing planning is that it uses digitally based communication tools and technology such as Social, Web, Mobile, Scannable Surface. Nevertheless, both are aligned with the vision, the mission of the company and the overarching business strategy.
The industry has four core players:
- the merchant (also known as 'advertiser' or 'retailer' or 'brand')
- the network (that contains offers for the affiliate to choose from and also takes care of the payments)
- the publisher (also known as 'the affiliate')
- the customer
The market has grown in complexity, resulting in the emergence of a secondary tier of players, including affiliate management agencies, super-affiliates, and specialized third party vendors.
Affiliate marketing overlaps with other Internet marketing methods to some degree because affiliates often use regular advertising methods. Those methods include organic search engine optimization (SEO), paid search engine marketing (PPC – Pay Per Click), e-mail marketing, content marketing, and (in some sense) display advertising. On the other hand, affiliates sometimes use less orthodox techniques, such as publishing reviews of products or services offered by a partner.
Affiliate marketing is commonly confused with referral marketing, as both forms of marketing use third parties to drive sales to the retailer. The two forms of marketing are differentiated, however, in how they drive sales, where affiliate marketing relies purely on financial motivations, while referral marketing relies more on trust and personal relationships.
Affiliate marketing is frequently overlooked by advertisers.[6] While search engines, e-mail, and web site syndication capture much of the attention of online retailers, affiliate marketing carries a much lower profile. Still, affiliates continue to play a significant role in e-retailers' marketing strategies.
Web 2.0
Websites and services based on Web 2.0 concepts—blogging and interactive online communities, for example—have impacted the affiliate marketing world as well. These platforms allow improved communication between merchants and affiliates. Web 2.0 platforms have also opened affiliate marketing channels to personal bloggers, writers, and independent website owners. Contextual ads allow publishers with lower levels of web traffic to place affiliate ads on websites.
Forms of new media have also diversified how companies, brands, and ad networks serve ads to visitors. For instance, YouTube allows video-makers to embed advertisements through Google's affiliate network. New developments have made it more difficult for unscrupulous affiliates to make money. Emerging black sheep are detected and made known to the affiliate marketing community with much greater speed and efficiency.
Some advertisers offer multi-tier programs that distribute commission into a hierarchical referral network of sign-ups and sub-partners. In practical terms, publisher "A" signs up to the program with an advertiser and gets rewarded for the agreed activity conducted by a referred visitor. If publisher "A" attracts publishers "B" and "C" to sign up for the same program using his sign-up code, all future activities performed by publishers "B" and "C" will result in additional commission (at a lower rate) for publisher "A".
Two-tier programs exist in the minority of affiliate programs; most are simply one-tier. Referral programs beyond two-tier resemble multi-level marketing (MLM) or network marketing but are different: Multi-level marketing (MLM) or network marketing associations tend to have more complex commission requirements/qualifications than standard affiliate programs
Affiliate websites are often categorized by merchants (advertisers) and affiliate networks. There are currently no industry-wide standards for the categorization. The following types of websites are generic, yet are commonly understood and used by affiliate marketers.
- Search affiliates that utilize pay per click search engines to promote the advertisers' offers (i.e., search arbitrage)
- Price comparison service websites and directories
- Loyalty websites, typically characterized by providing a reward or incentive system for purchases via points, miles, cash back
- Cause Related Marketing sites that offer charitable donations
- Coupon and rebate websites that focus on sales promotions
- Content and niche market websites, including product review sites
- Personal websites
- Weblogs and websites syndication feeds
- E-mail marketing list affiliates (i.e., owners of large opt-in -mail lists that typically employ e-mail drip marketing) and newsletter list affiliates, which are typically more content-heavy
- Registration path or co-registration affiliates who include offers from other merchants during the registration process on their own website
- Shopping directories that list merchants by categories without providing coupons, price comparisons, or other features based on information that changes frequently, thus requiring continual updates
- Cost per action networks (i.e., top-tier affiliates) that expose offers from the advertiser with which they are affiliated with their own network of affiliates
- Websites using adbars (e.g. AdSense) to display context-sensitive advertising for products on the site
- Virtual currency that offers advertising views in exchange for a handout of virtual currency in a game or other virtual platform.
- File-Sharing: Web sites that host directories of music, movies, games and other software. Users upload content to file-hosting sites and then post descriptions of the material and their download links on directory sites. Uploaders are paid by the file-hosting sites based on the number of times their files are downloaded. The file-hosting sites sell premium download access to the files to the general public. The websites that host the directory services sell advertising and do not host the files themselves.
- Video sharing websites: YouTube videos are often utilized by affiliates to do affiliate marketing. A person would create a video and place a link to the affiliate product they are promoting in the video itself and within the description.
- Affiliate tracking software
- Internet advertising: E-mail spam, e-mail marketing, post-click marketing, Website monetizing
- Advertising methods: Ad filtering, ad serving, central ad server, pop-up ad, contextual advertising, web banner
- Marketing tactics: Guerilla marketing, marketing strategy, evangelism marketing, viral marketing, word of mouth marketing
- Search engines: Search engine marketing (SEM), search engine optimization (SEO), pay per click, click fraud, paid inclusion
- Industry calculations: Click through rate (CTR), cost per action (CPA), cost per click (CPC), cost per impression (CPI), cost per mille (CPM), effective cost per mille (eCPM)
Unlike traditional marketing techniques, which involve direct, one-way messaging to consumers (via print, television, and radio advertising), nonlinear digital marketing strategies are centered on reaching prospective customers across multiple online channels.
Combined with higher consumer knowledge and the demand for more sophisticated consumer offerings, this change has forced many businesses to rethink their outreach strategy and adopt or incorporate omnichannel, nonlinear marketing techniques to maintain sufficient brand exposure, engagement, and reach.
Nonlinear marketing strategies involve efforts to adapt the advertising to different platforms, and to tailor the advertising to different individual buyers rather than a large coherent audience.
Tactics may include:
- Search engine optimization (SEO)
- Social media marketing
- Video marketing
- Email marketing
- Blogging
- Website marketing
- Paid search/contextual advertising
Some studies indicate that consumer responses to traditional marketing approaches are becoming less predictable for businesses. According to a 2018 study, nearly 90% of online consumers in the United States researched products and brands online before visiting the store or making a purchase The Global Web Index estimated that in 2018, a little more than 50% of consumers researched products on social media. Businesses often rely on individuals portraying their products in a positive light on social media, and may adapt their marketing strategy to target people with large social media followings in order to generate such comments.In this manner, businesses can use consumers to advertise their products or services, decreasing the cost for the company.
Digital Marketing Channels are systems based on the Internet that can create, accelerate, and transmit product value from producer to a consumer terminal, through digital networks. Digital marketing is facilitated by multiple Digital Marketing channels, As an advertiser one's core objective is to find channels which result in maximum two-way communication and a better overall ROI for the brand. There are multiple digital marketing channels available namely;
- Affiliate marketing - Affiliate marketing is perceived to not be considered a safe, reliable, and easy means of marketing through online platforms. This is due to a lack of reliability in terms of affiliates that can produce the demanded number of new customers. As a result of this risk and bad affiliates, it leaves the brand prone to exploitation in terms of claiming commission that isn't honestly acquired. Legal means may offer some protection against this, yet there are limitations in recovering any losses or investment. Despite this, affiliate marketing allows the brand to market towards smaller publishers and websites with smaller traffic. Brands that choose to use this marketing often should beware of such risks involved and look to associate with affiliates in which rules are laid down between the parties involved to assure and minimize the risk involved.
- Display advertising - As the term implies, online display advertising deals with showcasing promotional messages or ideas to the consumer on the internet. This includes a wide range of advertisements like advertising blogs, networks, interstitial ads, contextual data, ads on search engines, classified or dynamic advertisements, etc. The method can target specific audience tuning in from different types of locals to view a particular advertisement, the variations can be found as the most productive element of this method.
- Email marketing - Email marketing in comparison to other forms of digital marketing is considered cheap; it is also a way to rapidly communicate a message such as their value proposition to existing or potential customers. Yet this channel of communication may be perceived by recipients to be bothersome and irritating especially to new or potential customers, therefore the success of email marketing is reliant on the language and visual appeal applied. In terms of visual appeal, there are indications that using graphics/visuals that are relevant to the message which is attempting to be sent, yet less visual graphics to be applied with initial emails are more effective in-turn creating a relatively personal feel to the email. In terms of language, the style is the main factor in determining how captivating the email is. Using a casual tone invokes a warmer and gentle and inviting feel to the email in comparison to a formal style. For combinations; it's suggested that to maximize effectiveness; using no graphics/visual alongside casual language. In contrast, using no visual appeal and a formal language style is seen as the least effective method
- Search engine marketing - Search engine marketing (SEM) is a form of Internet marketing that involves the promotion of websites by increasing their visibility in search engine results pages (SERPs) primarily through paid advertising. SEM may incorporate Search engine optimization, which adjusts or rewrites website content and site architecture to achieve a higher ranking in search engine results pages to enhance pay per click (PPC) listings.
- Social Media Marketing - The term 'Digital Marketing' has a number of marketing facets as it supports different channels used in and among these, comes the Social Media. When we use social media channels ( Facebook, Twitter, Pinterest, Instagram, Google+, etc.) to market a product or service, the strategy is called Social Media Marketing. It is a procedure wherein strategies are made and executed to draw in traffic for a website or to gain the attention of buyers over the web using different social media platforms.
- Social networking service - A social networking service is an online platform which people use to build social networks or social relations with other people who share similar personal or career interests, activities, backgrounds or real-life connections
- In-game advertising - In-Game advertising is defined as the "inclusion of products or brands within a digital game."The game allows brands or products to place ads within their game, either in a subtle manner or in the form of an advertisement banner. There are many factors that exist in whether brands are successful in the advertising of their brand/product, these being: Type of game, technical platform, 3-D and 4-D technology, game genre, congruity of brand and game, prominence of advertising within the game. Individual factors consist of attitudes towards placement advertisements, game involvement, product involvement, flow, or entertainment. The attitude towards the advertising also takes into account not only the message shown but also the attitude towards the game. Dependent on how enjoyable the game is will determine how the brand is perceived, meaning if the game isn't very enjoyable the consumer may subconsciously have a negative attitude towards the brand/product being advertised. In terms of Integrated Marketing Communication "integration of advertising in digital games into the general advertising, communication, and marketing strategy of the firm" is important as it results in a more clarity about the brand/product and creates a larger overall effect.
- Online public relations
- Video advertising - This type of advertising in terms of digital/online means are advertisements that play on online videos e.g. YouTube videos. This type of marketing has seen an increase in popularity over time. Online Video Advertising usually consists of three types: Pre-Roll advertisements which play before the video is watched, Mid-Roll advertisements which play during the video, or Post-Roll advertisements which play after the video is watched. Post-roll advertisements were shown to have better brand recognition in relation to the other types, where-as "ad-context congruity/incongruity plays an important role in reinforcing ad memorability". Due to selective attention from viewers, there is the likelihood that the message may not be received.The main advantage of video advertising is that it disrupts the viewing experience of the video and therefore there is a difficulty in attempting to avoid them. How a consumer interacts with online video advertising can come down to three stages: Pre attention, attention, and behavioral decision. These online advertisements give the brand/business options and choices. These consist of length, position, adjacent video content which all directly affect the effectiveness of the produced advertisement time,therefore manipulating these variables will yield different results. The length of the advertisement has shown to affect memorability where-as a longer duration resulted in increased brand recognition.This type of advertising, due to its nature of interruption of the viewer, it is likely that the consumer may feel as if their experience is being interrupted or invaded, creating negative perception of the brand. These advertisements are also available to be shared by the viewers, adding to the attractiveness of this platform. Sharing these videos can be equated to the online version of word by mouth marketing, extending number of people reached. Sharing videos creates six different outcomes: these being "pleasure, affection, inclusion, escape, relaxation, and control".As well, videos that have entertainment value are more likely to be shared, yet pleasure is the strongest motivator to pass videos on. Creating a ‘viral’ trend from a mass amount of a brand advertisement can maximize the outcome of an online video advert whether it be positive or a negative outcome.
- Native Advertising- involves the placement of paid content that replicates the look, feel, and oftentimes, the voice of a platform's existing content. It is most effective when used on digital platforms like websites, newsletters, and social media. Can be somewhat controversial as some critics feel it intentionally deceives consumers.
- Content Marketing- an approach to marketing that focuses on gaining and retaining customers by offering helpful content to customers that improves the buying experience and creates brand awareness. A brand may use this approach to hold a customer’s attention with the goal of influencing potential purchase decisions.
- Sponsored Content- content created and paid for by a brand to promote a specific product or service.
- Inbound Marketing- a market strategy that involves using content as a means to attract customers to a brand or product. Requires extensive research into the behaviors, interests, and habits of the brand's target market.
It is important for a firm to reach out to consumers and create a two-way communication model, as digital marketing allows consumers to give back feedback to the firm on a community-based site or straight directly to the firm via email. Firms should seek this long term communication relationship by using multiple forms of channels and using promotional strategies related to their target consumer as well as word-of-mouth marketing.
