How Affiliate Marketing Looks In February 2010

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An insight into Affiliate Marketing in 2010, how advertisers assess the value it brings, the key metrics for performance and a comparison to paid search marketing as a channel.

Transcript of How Affiliate Marketing Looks In February 2010

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Presentation to Google UK How Affiliate Marketing Looks in February 2010Sri Sharma Managing Director1st February 2010

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Key Stats on Affiliate Marketing

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The UK affiliate market was worth £3.82bn in 2008,22% growth in 2008 and projected to cross £4bn 2009. Source: Econsultancy, Nov 2009

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The UK market for Search Engine Marketing was worth £2.42bn in 2008, 23% growth in 2008, projected to grow by 12% in 2009. Source: Econsultancy, Nov 2009

Paid Search forms 59.3% of all online advertising in the UK. Source: IAB UK, Apr 2009

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Affiliate Marketing –- How it works

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Where a third party advertises products or services on behalf of a retailer in return for an agreed commission for a sale or lead.

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MerchantAgencyAffiliateNetwork

Affiliate Publisher

Term covers the whole industry:

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34% full time, 46% part time, 20% hobbyists

18% female, the rest maleSource: Econsultancy, Nov 2009

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80/20 is actually 99/1

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Affiliate Marketing Mix

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Corporate intranet 2%

True content (SEO) 36%Paid Search (PPC) 20% Price comparison 11%

 Blogs and forums 8%

 Email marketing 5%  Voucher codes 5%

 Cash-back and reward 5%

 Shopping directories 4%  Social networking 3%

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Source: Econsultancy, Nov 2009

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Key Metrics for the Client in

Affiliate Marketing

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Typically Direct Response Goals

Target marketing Cost per sale

Contribution to profit of each incremental sale

Revenue generated per £1 spend

Cost per acquisition - paid to the affiliate (CPA)

Conversion Rate

Earning per Click (EPC)12

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The Client Perspective –

Why an Affiliate Marketing Strategy?

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Drive revenue

Expand reach with limited budget

Low financial risk

Easy to measure

Improve brand visibility and awareness

Influence other marketing activities

Complement other marketing activities

Board directors increasingly get it

Increasingly accepted part of the marketing mix

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Affiliate Marketing Strategy Examples

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Content SEO

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Rise of Voucher Codes

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Social Networking

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PPC

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2009

Thank youDo you have any questions?

E: sri@netmediaplanet.com T: +44 (0) 203 008 8321Tweet me: @srisharmawww.netmediaplanet.com

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