The partner and affiliate industries have shown a tremendous and continuous record of growth since the inception of the internet. This category and subcategory of marketing tactics have moved from profitable niche to mainstream in just a few short years. It’s clear that partnership is a key driver of revenue for companies in many industries, not a niche business, and that the role of partnerships in the marketing mix is significant.
To understand the key drivers of that growth, and to capture a strong view into how leading marketing, sales and business development leaders view the spaces, we commissioned this massive global study about partnerships. In addition to facts about the size and growth of the arena, we also solicited opinions about products and services available to the industry.
Purpose
The purpose of this partner and affiliate marketing research was to understand the size, growth trends, and role of partnership in the marketing mix, and to capture perspective from senior business leaders on how they view this growing marketing channel.
Research Design
Internet and telephone survey with invitations delivered to a broad cross-section of business leaders by WBR Research. Some respondents directly manage a partner and affiliate program(s) — they are active affiliate marketers. But many are more senior in their organizations, responsible for far more than affiliate marketing programs.
Sample
About 300 completed surveys from four key regions:
EMEA (301 responses)
NORTH AMERICA (301 responses)
AUSTRALIA/NEW ZEALAND (298 responses)
ASIA (300 responses)
About 400 completed surveys for each of four industries.
RETAIL/ETAIL (400)
TRAVEL (401)
FINANCIAL SERVICES (399)
Respondents were mostly senior marketers and brand leaders. 82% were above the level of manager, and 40% were above the level of director.
Major Brand Focused
Our research focused primarily on capturing insights from leaders of large brands. 72% of respondents work for firms generating more than US$500,000,000 in annual sales. 38% work for companies with greater than US$2,000,000,000 in annual sales. 24% at companies with greater than US$5,000,000,000 in annual sales.
Topline Conclusions
Future blog posts in this affiliate marketing research miniseries will run through the specifics of our research. For now, what follows are capsule conclusions:
Partnership is an important and growing segment of performance marketing, driving a significant portion of sales and investment from business leaders. With the majority of companies reporting that that their partner/affiliate marketing program(s) now drive more than a fifth of their sales, it’s clear that this highly efficient business channel is now a critical part of many marketing plans.
Virtually all brands pursue some forms of performance partnership and/or affiliate marketing, and view it as a high priority. As to how people manage and talk about the industry, we appear to be in a period of flux, with no management structure, tools, or even nomenclature dominating the space. That said, the passion and interest in partnerships among business leaders is high.
Research findings pointed to a number of specific key takeaways:
- It’s clear that partnerships and affiliate marketing have become integral components of many companies’ marketing strategy. In fact, many companies view partnership and affiliate as key components of their long-term success.
- Virtually all companies surveyed are already active in internet marketing partnerships and affiliate programs, and the few that are not yet active plan to be in the next 12 months.
- Partnerships are playing a key role in driving revenue money for many companies. More than half of our sample (54%) reported that partnerships drive more than 20% of total company revenue.
- Partnerships are a high priority for their companies. 74% report that partnerships and affiliate marketing campaigns are a high or very high priority for their businesses. Just 5% say they will invest less on partnerships this year versus last year.
- More than half of respondents say partnerships are driving more customers and sales this year than last year. Just 1% say partnership sales are declining for their businesses.
- The top brand leader priorities include finding more partners (27%) and strengthening relationships with existing partners (23%,) two key growth strategies for the channel.
- Partnerships are viewed as a key potential growth channel. A massive 69% of respondents see additional sales potential in the channel, and 24% see major incremental potential. This is great news for the performance marketing/commissions-based industry.
- Many leading brands are prioritizing large partners versus forging agreements with thousands of potential partners. The most common number of partners for a brand is 50-99 (34%). 67% of brands report having less than 100 total partners. Just 2% of brands surveyed partner with more than 1,000 businesses.
- Many brands report significant revenue coming from “emerging” partnership channels like major media companies (26%), influencers (14%), and brand-to-brand partnerships (9%). While “traditional” affiliate style partners drive more sales than other channels (36% for traditional partners like loyalty communities and 10% long-tail publishers), strong sales for these emerging channels proves the theory that the category and definition of partnership is broadening.
- There is no dominant partner management team or structure among our respondents.
- Networks and third-party software are commonly used to field and manage partnerships. Because partnership is broader than just affiliate marketing, only about half of our marketers report relying on networks for partnerships. Just over half (52%) of the brand leaders surveyed say they work with an affiliate network to manage partnerships. One third of those (17%) they are exclusively customers of affiliate link based networks. 56% work with a third party partner management software product to measure traffic and sales, like that offered by Partnerize, of which more than a third (21%) work exclusively with software to manage their cost-per-acquisition and pay per click programs.
- The terminology used in the partnerships arena is in flux over time. The vast majority of our respondents (84%) are familiar with the term affiliate marketing and how participants use it for making money. Most view affiliate and partnership as related categories/keywords.
- Across the industry, we’ve seen growing acceptance of the idea that partnership is a broad category that includes affiliate/affiliate sites, but also includes partnerships with social media influencers, traditional content publishers, and other leading brands — businesses that might not consider themselves part of the affiliate site zeitgeist. About four in ten (41%) of respondents agreed with this online marketing lexical assertion – the most common POV.
In tomorrow’s post — the second in this partner and affiliate marketing research series — we’ll review the specific data on partner channel growth, importance, and contribution to company revenue.
To download a free copy of our partner and affiliate marketing research in PDF, click here.
Note: Partnerize is the new trading name for Performance Horizon. Visit our homepage for more information about our services and company. Contact us for information on the survey and our services.
