Key takeaways from this blog
- AI and machine learning technologies may bring increasingly personalized targeting and speed up the cycles of affiliate marketing.
- TikTok and Amazon’s competition for a greater share of affiliate marketing dollars will likely have big consequences for the industry.
- Consumers are getting both more savvy and more trusting of affiliate and influencer marketing.
- The lines separating partnerships will blur as more adopt affiliate-style payments and unified partner management systems.
- Higher costs and uncertainty will continue challenging brands, publishers, and agencies alike.
While you can’t gaze into a crystal ball to see every twist and turn the affiliate marketing industry will take in the coming year, we can turn to experts to help bring the hazy path forward into focus. We contacted leading voices in the affiliate marketing industry to ask what they saw on the horizon. These predictions will help you strengthen your affiliate program for 2024.
- The Experts
- The 5 Trends:
- Cristy Garcia is the Chief Marketing Officer at impact.com. With over 18 years of experience in marketing, she has been recognized as one of the most influential marketing executives shaping the future of the industry by Business Insider and others.
- Coady Joy is the Head of Affiliate and Partnerships Education at impact.com. She leads the Partnership Experience Academy, which provides marketers with instructor-led training and short courses on all aspects of affiliate and partnership management.
- Brian Marcus is the Senior Director of Product Marketing at impact.com. He is an industry expert with over 20 years of experience, including senior leadership roles at Google Affiliate Network (GAN) and eBay Partner Network (ePN).
- Tye DeGrange is the CEO of Roundbarn Labs, a growth marketing agency. He’s been working with affiliates and other forms of partnership marketing for nearly 20 years.
- Michael McNerney is publisher of the Martech Record, an independent trade publication covering the intersection of marketing, content, and commerce.
1. AI marches on
Generative AI exploded onto the scene with the release of ChatGPT in November of 2022. By January 2023, it had become the fastest-growing piece of consumer software in history. Over the last year, it became pervasive, and worked into everything from grammar apps to video editing and affiliate marketing software. There’s no sign that it’ll slow down.
Roundbarn Labs CEO Tye DeGrange believes gen AI bring unprecedented speed to the channel. “I do not think its a threat so much as a wave of new tech that each professional can leverage to monitor,” he said. “Will it require oversight, open source, and regulation? Yes. But it could speed up the cycles of a channel that historically has not been.”
Cristy Garcia, the Chief Marketing Officer at impact.com, believes that AI and machine learning technologies will continue to refine personalized experiences. “In 2024, affiliates will leverage AI to analyze user behavior, preferences, and purchasing patterns, allowing for more targeted and personalized marketing strategies,” she said.
2. TikTok and Amazon enter the ring
TikTok and Amazon made big swings in the affiliate space in 2023, with TikTok launching Shops and Amazon releasing its Inspire platform. These new platforms will likely have a big impact on the industry this year.
Keeping a finger on the pulse of how consumers shop will pay off. TikTok Shops seems to be catching on quickly, according to impact.com’s Head of Affiliate and Partnerships Education Coady Joy. She’s seeing more and more creators promote products tagged as “eligible for commission.”
“I think we’re going to see a big shift of people shopping on TikTok, particularly with Gen Z,” Joy says.
Amazon, of course, has been in the affiliate arena for nearly 30 years through its Associates program. The Inspire platform’s release means they’re both using affiliates to drive traffic to the site and directly providing a space for creators to market products.
As Amazon and TikTok are battling it out for mindshare, DeGrange sees a lot of promise in the Seattle-based startup Levanta. The company helps Amazon sellers create their own affiliate programs.
3. Consumer behavior shifts towards affiliate marketing
The marketing landscape constantly changes to meet shoppers where they are. Three big shifts in consumer behavior may help strengthen affiliate marketing in 2024.
A whole new generation is growing its buying power. As Gen Z continues to age into the job market, you’ll see changes in how people shop. According to Joy, “It will open up all kinds of opportunities for brands to connect with consumers.”
Gen Z and millennials alike are increasingly trusting of influencers. According to a report by Morning Consult, the shares of Gen Zers and millennials who trust social media influencers grew from 51 percent in 2019 to 61 percent in 2023.
Consumers are also getting smarter, says Michael McNerney, publisher of the Martech Record. They’re becoming better at evaluating reviews and influencer content as they consume more of it. Affiliates need to do more than write a review that Google likes. “The consumer is now reading many more reviews,” he says, “learning which ones to trust and adjusting accordingly.”
Finally, the younger generations of consumers tend to be more environmentally conscious. According to a 2022 survey, 62.7 percent of Gen Z respondents said tracking their environmental impact was either very important or somewhat important.
As a result, Garcia says that brands and consumers are placing greater emphasis on sustainability and ethical practices. Affiliates aligning themselves with eco-friendly or socially responsible brands could see increased engagement and loyalty from conscientious consumers.
4. Partnerships become more unified and dynamic
As consumer behavior and market forces shift, so does the nature of partnerships. Brands now use everything from podcasts to Instagram to connect with new audiences through affiliate payment systems.
“The options are vast,” DeGrange says. “They span the whole funnel. Publishers should be excited as there are more ways to monetize and grow brands looking to diversify away from just Google and Facebook.”
Garcia sees collaborations between affiliates and brands becoming more creative and dynamic. She says, “Revenue-sharing models, joint ventures, and unique partnerships can foster mutually beneficial relationships that drive innovation and success.”
Brian Marcus, impact.com’s Senior Director of Product Marketing, foresees a great blurring of lines throughout the partnership economy. “Brands will become publishers, publishers will develop their own brands, and disparate partnership islands will come together.”
He predicts this will happen thanks to the unification and standardization of methods, reporting, and tools through platforms like impact.com.
5. Economic strain and uncertainty bring challenges to growth
Global events of the past few years have brought a lot of uncertainty. “Brands have struggled to plan media as far out,” McNerney says. That uncertainty has rippled out to affect the planning of publishers and agencies.
According to McNerney, most projections show that ecommerce has settled into a more predictable rate of growth after the jolts and drops experienced during and after COVID-19. This could make it easier for brands, publishers, and agencies to make more accurate, longer-range plans.
The costs of affiliate paid placement are unlikely to soften, according to DeGrange, despite improvements in consumer disposable income and a recovering global economy.
“While there is some wiggle room and opportunity, the winners across the ecosystem add value,” he says. “Therefore, they do not have to discount too heavily.”
Providing that higher costs will remain a challenge, Joy predicts many brands will need to get creative to make the most of a smaller budget. “Working closely with your publishers on a game plan for the year when you don’t have extra budget is crucial to ensure everyone’s success,” she says.
However, budget cutting brings its own risks. Cutting staff, ditching software tools, and chasing lower-cost affiliates could cause you to miss out on partnerships that could drastically boost your revenue.
“Sometimes,” DeGrange says, “investment in class tools and people matters and will help you get through challenging times, not the other way around.”
Take action with your affiliate program strategy
Ensuring the success of your affiliate program requires careful planning, effective strategies, and continuous monitoring. By understanding your target audience, optimizing your marketing efforts, and building strong relationships with your affiliates, you can create a thriving affiliate program that drives consistent results.
Remember to analyze and adapt your approach as needed to stay ahead of the competition and maximize your program’s potential. With the right tools and a dedicated team, you can make it all work and achieve lasting success for your affiliate program.
If you need a technology solution to help keep your affiliate program strong through uncertain times, check out impact.com. Reach out at email@example.com or request a demo.