With cases still on the rise worldwide, the full impact of the COVID-19 pandemic has yet to be determined. Social distancing, intermittent lockdowns, and changes to the supply chain have, obviously, altered the way consumers discover and shop – e-commerce, for instance, has seen explosive growth (by some estimates, coronavirus has accelerated e-commerce by four to six years).

These shifts in consumer behavior have caused some marketers to question the most effective way to promote their brands. Marketing budgets are constricted, competition for eyeballs on the internet is higher than ever, and consumers are keeping a close eye on their discretionary spending. 

In the past, affiliate marketing has been a low-input, high return growth mechanism for enterprises of all sizes. COVID-19 has thrown that equation into question, causing businesses to ask: Is affiliate marketing dead? 

What is affiliate marketing?

If you’re unfamiliar with the term affiliate marketing, chances are you’ve still come across it in practice. Affiliate marketing is a sales tactic that lets a company increase sales by asking affiliates to recommend the product to others in their community. Affiliates earn a commission every time one of their recommendations converts into a sale. 

Affiliate marketing is usually accomplished by tapping people in your key audience – those most likely to make a purchase from your brand – to spread the word about your product or service. The practice captures the impact of word-of-mouth (WOM) marketing, the most effective form of marketing out there. Consider these stats: 

This type of social marketing capitalizes on the psychology of WOM marketing to make referrals a win-win for the company and the affiliate. But, as consumers get savvier online, and the pandemic changes our shopping behavior, are affiliates still effective? 

Changes to the affiliate marketing landscape

Because affiliate marketing is broadly applicable to many industries, the answer to “Is affiliate marketing dead?” is not so straightforward. The changing nature of the pandemic has also made it difficult to discern any clear signals in marketing data that can direct you toward a guaranteed strategy for success. But, here’s what we do know. 

Organic traffic is down across the board

Organic traffic – when users find your website through a simple Google search and don’t click on a sponsored result – is down in many industries. Consumers were searching less overall, and searching mostly for necessities rather than luxury goods. Travel is getting virtually no organic traffic, while technology, software, retail and e-commerce also saw overall drops. Media sites and financial services are the two exceptions that have seen a lift in organic traffic. 

Lower organic traffic also resulted in fewer conversions. Even in the travel industry, where brands tried to incentivize purchases by offering massive discounts, consumers were spending less. 

What these data points suggest is that affiliate recommendations are more powerful than before COVID-19. Fewer customers are browsing the internet and taking the time to discover products of their own accord. A recommendation from a trusted affiliate may carry more weight than in previous markets, where a consumer had the disposable income and time to search the internet for the thing they needed. 

Choose the right affiliate promo

As spending and search trends outlined above would suggest, the efficacy of affiliate marketing varies depending on what industry you’re in and what you’re able to sell. 

“COVID-19 has turned the affiliate marketing industry upside down,” said John Lincoln, co-founder and CEO of Ignite Visibility told Forbes. “Some areas that used to have offers have completely gone away while others have exploded. We are seeing health, entertainment, supplements, medical supplies and oxygen and breathing items really take off, for example. While on the other end, affiliate offers for gyms, certain types of education and more go away.”

What does that mean for your affiliate marketing program? To get the most bang for your buck pivot to an in-demand product that can make an affiliate’s promotion skyrocket. Analyze sales “at an SKU level” recommends one expert, to see where shoppers are prioritize spending at your company. It could be that non-core products are suddenly the most in-demand.

“Savvy brands are also exploring categories that shoppers haven’t thought about yet, such as socks, kids’ shoes, dress tops, and tents. Walmart revealed they are selling more tops than bottoms as more people telework,” reported StreetFight.

Account for the new customer journey

As the organic search numbers show, the customer journey has – at least temporarily – shifted. “With so many Americans constantly searching for information on or related to coronavirus and COVID-19, it’s not surprising many websites are seeing their visitor traffic getting thrown for a loop,” reports Forbes.

Consumers are spending time looking for news updates, not brands. They’re also spending more time on social media. “With nearly all public gatherings called off, Americans are seeking out entertainment on streaming services like Netflix and YouTube, and looking to connect with one another on social media outlets like Facebook,” reported The New York Times

Facebook use has skyrocketed, as have apps like NextDoor that tell you more about what’s going on in your neighborhood. For your affiliate program, that indicates the importance of investing in affiliate agencies and software partners that focus on social marketing and local marketing. 

Bottom line: affiliate marketing remains a safe marketing tool in a risky market. Because affiliate marketers are only paid on commission, e-commerce brands won’t incur the risk inherent in other media buying options. Affiliate marketing can practically guarantee a positive ROI on your marketing efforts when implemented correctly. Learn more by getting in touch with the experts at Andromeda.

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Get to know the author:

Alex Steeno

Alex Steeno

Alex is a growth marketing, design, and analytics expert who currently serves a portfolio of client's as either a fractional Head of Growth, Head of Analytics, and sometimes both.

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