R.O.EYE E-consultancy Affiliate Marketing Report 2008

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R.O.EYE are proudly sponsoring the 2008 E-consultancy Affiliate Marketing Report which is widely regarded as the official health-check for the industry.

As the leading affiliate marketing agency in the UK, we feel that it is important to bring this level of professional research to market and continue to underline and promote its significance within online advertising. Its independent nature and its year on year increase in levels of response from all areas of affiliate marketing underpins its significance. The report is widely referred to by agencies, affiliates, networks and merchants throughout the year of release allowing for affiliate marketing’s position to be identified in relation to both online and offline marketing.

The report’s release today brings mixed news for the industry. On the one hand there has been a reported drop in the portion of marketing spend ascribed to affiliate marketing from marketing budgets, with sales volumes dropping too as an overall portion. On the other hand both merchants and agencies are seeing the channel as more efficient than ever, even with the fall in reliance on ppc affiliates.

Some highlights include:

• Merchants continue to regard affiliate marketing as a cost-effective channel for driving customer acquisition. Some 46% of merchant respondents now say that the channel is very cost-effective compared to 44% last year.

• According to merchants, the most valuable affiliates – as a group - are SEO / content publishers, deemed to be driving a major contribution by 42%. This compares to 36% for paid search affiliates, 26% for loyalty / cashback sites, 20% for price comparison sites / aggregators, 17% for email affiliates and 10% for affinity sites.

• The three biggest barriers to successful affiliate marketing, from the perspective of merchants, are lack of internal resource (47%), restricted budget (29%) and difficulty in attracting affiliates (28%).

• A third of merchants (34%) say that five or fewer affiliates are driving 80% of their affiliate sales or sign-ups. A further 23% say that between six and 10 affiliates account for 80% of sales.

• Since the 2007 merchants’ survey, the average proportion of online marketing budget designated to affiliate marketing dropped from 18% to 14%, while the proportion of sales ascribed by merchants to affiliate activity has decreased from 16% in 2007 to 12% in 2008.

• Communication between merchants and affiliates has not improved since 2007. The proportion of merchants reporting good direct communication with all affiliates has fallen from 13% to 12%. The percentage of those with good direct communication with top-tier affiliates has also dropped, from 29% to 25%.

• More than a quarter of merchants (28%) say their organisations are poor at managing networks and policing and monitoring affiliate activity (26%).

Throughout the last year, we have developed as the industry has evolved. Changes in affiliate models, search marketing as a whole and the economic situation have given us all challenges and will continue to do so. We feel that our continued application of diverse thinking and encouragement of traffic monetistion across various affiliate genres will continue to see our model strengthen within the affiliate landscape.

Click here to obtain the full copy of the report.

[swifty7]

This is a brilliant report, well worth a read!!!

Hannah

[hpops]

Many thanks for that Colin, an excellent report with some very interesting findings.

[3wdl]

A good read - thanks to R.O.Eye for this.

[cat]

I echo the above.

I was supprised by some of the findings in this report.
Is the industry in decline?
This useful report is also worth reading by Affiliates.

[microhunter]

e-consultancy reports are always good - is this the same one as paid subscribers to e-consultancy, or a summarised version?