This is part of an ongoing series of conversations with an eCommerce amateur (who shall remain nameless) and two of DFO’s most knowledgeable (and patient) pros.

Today, Mai Willin (M) and Brennan Mack (B) give us the low-down on affiliate marketing and what it will look like in 2019.

Q: I’m new to the affiliate space. Can you explain what affiliate marketing is? Pretend I’m your mom, and we’re at the dinner table. 

M: Affiliate marketing is a popular way to make money online.  Someone – anyone – promotes a product via ads, social media, blogs, and more.  If a consumer purchases the product via that someone’s ad or blog, that someone makes money.

B: Exactly. It’s a great way for companies to sell products via “freelance” marketers. For instance, let’s say I’m in the toaster business, but I don’t have enough know-how to scale them. I can use affiliates to sell my toasters for me and pay them an agreed upon amount based on their number of sales.

Q: What’s the current state of affiliate marketing?

M: It’s trending in a positive direction. I’m consistently seeing higher-profile products and companies using the “performance” model, wherein they’re not required to pay an affiliate if they don’t see results.    

B: It can be a very different story depending on where you look. For affiliates who know how to market well, in the right way, the sky is the limit. They can help brands maximize sales, scale and value, especially in a performance model. On the other side of the coin, brands have heard stories about affiliates damaging a brand’s reputation via false promises, deceptive advertising and the like. That’s where a company like DFO is valuable. We can help separate out the bad actors.  

Q: How is it different than it was 5 years ago?

M: We’ve alluded to it already, but it’s shifted and now has a much more positive and compliant outlook. The days of running scams, or products that provide no value to customers, are largely over.

B: The space it occupies is much different. Five years ago, lead generation and “nutra” offers were much more prevalent, each with varying amounts of deception. Now, the space is focused on eCommerce products – physical goods. It helps tremendously that major platforms such as Facebook and Google have a firm grip on what can be said via advertising. While it undoubtedly has squeezed some affiliates’ bottom lines, it’s ultimately leading the industry in the right direction.

Q: You mentioned Facebook and Google. Can you explain their role in affiliate marketing?

M: The world’s busiest intersections always have the most billboards. Facebook and Google are the intersection’s digital equivalent. Since their digital highways are the busiest in the world, its lucrative for them to offer billboards – advertising space – to brands and affiliates. Naturally, if a brand or affiliate isn’t advertising via Facebook or Google, they’re missing out on a HUGE opportunity.

B: That’s a good way to put it.  Native advertising, where ads in a publication resemble the publication’s editorial content, also has a place in affiliate marketing. Google and Facebook, however, simply have the largest ad networks on the planet. There’s just no other audience that huge.

Q: Google and Facebook’s algorithms are robust and, what from I’ve read, always changing. How does this affect affiliate marketing? 

M: What Google and Facebook care most about is user experience. If customers aren’t happy when they use the platform, it’s a problem. Therefore, they’ve cracked down on deceptive and misleading advertising where products over-promise and under-deliver. If product owners, affiliates and other buyers aren’t paying attention to the constant evolution happening here, it’s going to have an affect on their bottom line.

B: The algorithm is difficult to assess, especially since both platforms are vague regarding when and how new changes are rolling out, and exactly what those changes will entail. Ultimately, like Mai said, it’s up to us as marketers to stay ahead of these changes. It’s brought the affiliate industry together; now, there are more digital “ad buyers” communities, where discussion revolves around platform tips, tricks and changes, than ever before.  

Q: What’s on the horizon from Google and Facebook in 2019?

M: Efforts to enforce ad compliance will continue. 2019 will be a banner year for reputation in eCommerce, as brands and affiliates more closely follow the guidelines Facebook and Google have set to keep users safe and happy.

B: Facebook was under scrutiny in 2018. As a result, they’ve adopted a “guilty until proven innocent” approach to ads and content. In 2019, this mindset, combined with their machine learning capabilities, will allow them to be much more prudent in what they allow on the platform. You’ll also see Google try to extend its reach into less “popular” advertising networks (App Traffic, YouTube, etc.), though they haven’t found that winning formula yet. Time will tell.

Q: What are some ways affiliates and networks can adjust their marketing in 2019 to help these behemoths embrace them?

M: It’s not rocket science. Simple solutions such as robust and ready customer service can make all the difference. Reply to your customer’s emails, comments and calls in a timely fashion. Promote and build sustainable, real products. 

B: Mai is right. The industry needs to focus on marketing principles, not gimmicks. Additionally, affiliates should concentrate on selling something they would want to buy; if they’re passionate about it, others will be, too. Finally, I would advise tempering risk with strategy. Risk can take you a long way; too much of it can sink your business.