Wednesday, February 17, 2010

UK affiliate marketing sector now worth more than £4bn

The UK affiliate marketing sector will be worth more than £4bn in online retail sales in 2009, according to a new report from Econsultancy.

According to the Affiliate Marketing Buyer’s Guide 2009, the market grew by 22% in 2008 to a value of £3.82bn and an estimated £227m was paid in commissions and fees to affiliate publishers and networks. Comparing those figures with IMRG and Capgemini figures for the overall UK internet retailing market, Econsultancy calculates that the affiliate marketing industry was responsible for nearly a tenth of all online sales during 2008.

“Because it is rooted in performance, affiliate marketing is continuing to prosper as an industry and we believe the affiliate sector will remain at the forefront of ecommerce as it continues to drive a high proportion of online sales,” says Econsultancy’s research director, Linus Gregoriadis. “Although the slashing of marketing budgets and well-documented collapse of companies such as Woolworths has had a negative impact, the increased appetite for performance-based advertising is making up for some of that downside.”

Key market trends identified by the authors include:

* The CPA (cost per acquisition) model goes from strength to strength
* Consumers turn to voucher code and cash-back websites
* Issues surrounding “last-click-wins” become more apparent
* Affiliates call for a greater emphasis on transparency and communication across the sector
* Publishers develop innovative media methods
* More agencies offer affiliate marketing services to clients

The Affiliate Marketing Buyer’s Guide 2009 includes profiles on the leading affiliate marketing networks as well as agencies involved in the field. The full report is available free to members of Econsultancy or can be purchased by non-members for £150.

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