Affiliate marketing set to surpass $10 billion in the US in 2024

Affiliate marketing is quietly becoming a powerhouse in the media and advertising world, even though it often flies under the radar. According to a recent forecast by eMarketer, affiliate marketing spend in the US is expected to hit $10.72 billion this year, fueling an estimated $307.27 billion in ecommerce sales. This growing trend is driven by several key factors, including the rise of value-driven consumers, the expanding creator economy, and a shift toward publishers leveraging first-party data.

In today’s economic climate, consumers are increasingly looking for value in every purchase they make. With inflation concerns and economic uncertainty, people are hunting for discounts, offers, and deals more than ever. Data from Antavo reveals that 79% of shoppers are going out of their way to purchase discounted or on-sale items, and 61% are more inclined to shop at discount retailers. Additionally, 55% of consumers are joining more loyalty programs to take advantage of perks and savings.

Affiliate marketing thrives in this environment, offering personalized deals, loyalty offers, and discounts that resonate with today’s savvy shoppers. “Affiliate marketing excels in these areas,” notes Max Willens, an eMarketer analyst. With consumers expecting lower prices and better deals, affiliates are perfectly positioned to meet these demands, making this strategy increasingly relevant.

Affiliate marketers have faced growing challenges from search engine changes, particularly Google’s Helpful Content Update and site reputation policies. These shifts, aimed at minimizing AI-generated content spam, have made it harder for affiliate marketers to rely on Google for visibility. As Google continues to prioritize AI overviews in search results, affiliate content often gets buried, reducing traffic to affiliate sites.

However, this has forced publishers and advertisers to innovate and diversify their strategies. Willens believes that the future of affiliate marketing lies in moving away from dependence on Google. Instead, publishers with access to rich first-party data are thriving, as they can reach consumers directly without relying on search engines. This shift benefits both creators and publishers who can tap into more personalized and targeted marketing approaches.

The creator economy has become a vital player in driving affiliate marketing’s success. Social media influencers and content creators are proving to be more effective at driving sales than traditional brand or retailer accounts. According to a March 2024 survey, creators are now a significant force in generating purchases through social platforms.

Platforms like Awin have seen an 80% year-over-year increase in the number of creators joining their affiliate networks. However, this surge in creators has also led to greater competition, with revenue per creator dropping by 40%. Despite this challenge, the influx of creators provides advertisers with a wider pool of potential partners, expanding the opportunities for affiliate marketing collaborations.

Trust in affiliate marketing is growing, especially among younger consumers. According to a survey by eMarketer, 55.1% of US consumers trust affiliate marketing to some extent. This trust is particularly strong among Gen Z, with nearly 40% of this demographic reporting that affiliate marketing influences their purchasing decisions. Millennials are close behind, with 35.2% saying affiliate marketing affects their buying behavior, compared to 24.5% of Gen Xers and 16.1% of baby boomers.

The growing trust in affiliate marketing highlights the increasing role of this strategy in consumer purchasing decisions, further cementing its place in the marketing ecosystem.

As third-party cookies become less reliable, first-party data is becoming the key to effective marketing. Retailers, financial institutions, and other commerce media players are now leveraging first-party data to deliver more personalized and targeted affiliate marketing campaigns. This data allows affiliate marketers to match consumers with the right products and deals, driving higher conversion rates.

Affiliate marketing strategies tied to loyalty programs, credit card rewards, and buy now, pay later (BNPL) services are particularly effective in this regard. These approaches help marketers tailor offers to consumers who are ready to buy, often reducing the need for heavy discounting. By using first-party data, affiliate marketers can strike the right balance between offering deals and maintaining profitability.