Will The Rising Cost of Living Impact Affiliate Marketing?

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In short, yes.?

The rising cost of living WILL impact affiliate marketing.?

We will undoubtedly see consumers become more considered in terms of how they shop and where they spend online.?

Many of them will now be doing more research first on products and pricing before committing to buying.?

In fact, I believe that rising costs will impact affiliate marketing quite severely because we’re going to need to use affiliates more throughout the buyer awareness journey and in the sales funnel, to really upsell our brands and educate about the key benefits of our products and services above just using competitive pricing.

To tackle this, I believe it’ll be good for brands to begin working closely with coupon discounts and loyalty sites during this period when customers are becoming spend thrifty and to work harder and figure out how to actually collaborate.?

We’re no longer going to be working in a price-driven market, nor do we want to be.?

We want to be advertising the value of our products and services to our customers, especially when they’re spending a little bit more time thinking about where and what they really need to buy.?

Obviously, consumer confidence is going to be focused on the rising cost of living.?

Due to this, certain luxury brands may see an impact on sales compared to everyday household items that consumers still need to buy.?

Mix Up Your Partners?

Understanding how you can leverage your affiliate program to work with partners in every stage of the buyer awareness funnel, and how you can leverage brand awareness during this period where spending might be affected, is important.?

You’ll also need to begin working closely with micro and nano-influencers.?

This way you’ll build relatability around products and be able to do detailed product showcases.

Essentially, you’re going to have to expand your partnership metrics and potentially look outside of the traditional affiliates and partners that you’ve been working with to get additional value out of the affiliate channel.?

Social Selling

I strongly believe that social selling is going to become increasingly important.?

Investing in platforms that can ACTUALLY convert, and also allow content curators to add links will be vital in your selling strategy going forward.?

Networks are already building technical ecosystems making selling even easier, like AWIN who have even integrated with sellers and official marketing partners which helps give brands visibility on campaign performance and improved conversion.?

Having that data is going to be incredibly necessary.?

Budgets

We’re going to need to spend our budgets more efficiently and effectively during this period.?

Right now, though it seems like there’s no drop off in terms of our ROI on ad spend for what’s being spent in affiliate marketing, many channels are still making a profit.?

The PMA recently delivered a white paper about the industry, and there were some interesting statistics surrounding the size of the affiliate marketplace.?

*Compared to 2018, where there was an estimated ￡6.2bn going through the affiliate channel, 2021 and 2022 ahead is continuing to grow to ￡9.1bn and beyond.?

We’ve continued a strong return on every dollar spent in this channel.?

Performance is going to be a key factor going forward to measure success and therefore pushing our budgets a little bit harder to deliver to core company KPI's as we go into this recessionary period will be crucial.?

* The PMA report also summarised that for every ￡1m spent in the affiliate channel, it drives around ￡12m in sales.?

Therefore, the affiliate channel is still one of the most effective areas to be investing in, especially during times when budgets are being cut and taken out of other direct to consumer channels.?

People Are More Brand Conscious

Really thinking about the partner mix you have in your affiliate program around this time is incredibly important and dependent on the industry you’re working in.?

But it’s also important to remember that during a recession, people become far more brand conscious.

So really investing in brand affinity and why people are purchasing these products, maybe even thinking about your sustainability and other USPS of your product to promote changing the message from price or promotion to display real benefits, is a great idea.?

You need to change tact in terms of engaging and understanding what customers need during this period and then match your marketing messages through your partnerships to ensure you’re attracting the right customers, at the right time and the right price point.?

Buy Now, Pay Later & Apps

Have you also considered introducing a Buy Now, Pay Later mechanic??

This way you can leverage pricing over time to enable your customers to be able to afford your products.?

This is a particularly good idea if you’re working in an expensive or luxury vertical.?

You also need to consider improving your in-app shopping experiences.?

But how?

How do you gain visibility in channels that you’ve maybe never looked at before??

While it’s difficult to test new channels as your budget is being stretched, it’s important to not put everything you have, in one place.?

Otherwise, you may end up missing out on niches in that buyer-awareness journey and therefore not gather as much momentum as you could with your affiliate program scale.?

It’s important to be cognisant about where you’re spending, how you’re spending and also with whom you’re spending your performance budgets.?

Make sure that you’re spreading that mix through the entire awareness funnel and adding value where and how you can, not just on price points and discount codes, but by educating and looking at sustainability and other key metrics that belong to your business or product, stack and service.?

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