By Heather Aeder, VP of Data Products and Integrations at Partnerize
There are good reasons that content has long been considered the rightful king. When well placed and targeted, it has the primal ability to connect and spark consumer engagement, both short and longer-term. Elevate this capacity to the practice of marketing, and the business utility is real. Specifically, within partnership marketing, affiliates, for example, applying a more networked, programmed approach, content partners help brands tell their story and introduce new consumers to their products. As these practices have continued to mature and the underlying tech has continued to advance, content has a proven history within partnership marketing for driving a higher percentage of revenue from new customers for brands. The past year has given us an even clearer view of what content can do. Its potential has been magnified and accelerated during COVID-19, as consumers shop online more than they previously had.
From our own study of the space, we saw the content share of traffic in the affiliate channel grow from 40% in 2019 to 50% in 2020. It’s already at 56% in the first four months of 2021.
Traffic from content partners grew 48% 2019 to 2020. While Coupon was -3% and Loyalty saw only 14% growth. The intensified traction we saw in 2020 bodes well for the union of brand and performance within the mix.
The Equation Driving Growth
It’s useful to understand the historic difference between brand marketing and performance marketing — as they have been regarded as distinct. Brand marketing has long been thought of as those upper-funnel marketing vehicles that bring new customers to an advertiser by building awareness of the brand and introducing its product offering. Traditional brand marketing channels have included display, TV, PR, print, and other content-driven marketing tactics. Marketers typically utilize brand marketing to reach large audiences reflecting their ideal persona. The payment mechanisms for brand marketing are usually CPC (Cost per Click), CPI (Cost per Impression), or flat fees for specific ad spots.
At the same time, performance marketing has historically encompassed marketing channels and tactics that drive consumers to convert — make a purchase, sign up for more information, or other overt actions. Traditional paid marketing channels to include things like social media, paid and organic search, partnership marketing, and email. These channels are used to target messaging to segments of consumers when they are in the consideration cycle for a product or service or ready to buy. The payment mechanisms for performance marketing are often CPC (Cost per Click), CPI (Cost per Impression), CPA (Cost per Acquisition), Cost per Lead, or Cost per Sales.
As it happens, 5-10 years ago, affiliate marketing sat squarely in the Performance Marketing category. This is because most affiliate marketing publishers were geared to drive consumers to purchase something they have shown an interest in (re: Coupon sites, Loyalty sites). In the last five years, affiliate marketing has advanced and transformed into true partnership marketing. Content partners have helped the affiliate channel bridge the gap and made affiliates both a brand marketing and performance marketing channel. At a high level, as the environment has matured, one factor is that consumers view content partners as trusted sources of information for product info; at the same time, MORE content partners are joining affiliate networks, seeing the tech advances that will allow them to be compensated for the top of the funnel traffic. Specifically, tech advances that reward content sites and give them the credit they deserve have resulted in more content partners being inclined to join affiliate networks. Further, advertisers excited by this change, have invested more marketing spend in these content partners to take advantage of the new customers they bring.
Building the momentum further, advertisers have optimized their spend with coupon and loyalty affiliate partners to ensure they reward specific actions they want to incentivize — for example, increased pay-outs, based on things like items they want to liquidate, customer lifetime value, and so on.
How Can Marketers Draw More Success from Content within Partnership Marketing in 2021?
A successful partnership program is one that contains a blend of partners from content and non-content sites to help achieve varying goals vs. a singular metric — a balance of new customer acquisition, revenue volume, and more. Generally, the pay-for-performance model that affiliate allows is a fantastic tool to have on the brand marketing side.
As a closing thought with all eyes on the new year, COVID has changed how consumers shop. These trends are not expected. A Shopify report (sourced from Global Web Index) shows that 48.8% of consumers say they will shop online more frequently after the outbreak is over. This means there are many customers who are searching for items or services to purchase online that would have previously used non-digital means to shop. Marketers need to find them and convert them. Thus, marketing platforms that help marketers address both of these needs should receive an increased share of the marketing budget. Paid Search and Affiliate both achieve these goals. Paid Search through brand and non-brand keywords and affiliate through content publishers to bring new customers and coupon/loyalty sites to convert customers when they are comparing competing products between advertisers.