CONTRIBUTION OF AFFILIATE MARKETING TOWARDS MULTIPLE INCOME GENERATION: A SURVEY OF BOTSWANA TERITORY

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1 CONTRIBUTION OF AFFILIATE MARKETING TOWARDS MULTIPLE INCOME GENERATION: A SURVEY OF BOTSWANA TERITORY Presented by Samuel Chingoiro (PhD-Economics Candidate; ICSA and CIMA) Robert P. Machera ( MBA; ICSA; FSAAA; MIPMZ; MZIM; ICM-HRD)

2 INTRODUCTION Affiliate marketing is a mutual agreement between the affiliate and the online merchant, whereby the affiliate is paid either a fixed percentage of money or a commission for selling the merchant s products or services online. Affiliate marketing is a recent discipline that has gained momentum in the field of marketing and it has managed to uplift the standards of living of many individuals across the world as it facilitates multiple income generation. Income from multiple sources such as affiliate marketing is one of the most attractive trends of present day lifestyle. In the process of globalization, companies on the other hand, are finding it imperative to market their products and services through online marketing as they put up great effort to reach all corners of the world markets including developing countries like Botswana.

3 Background of affiliate marketing Affiliate marketing worldwide has been recognized as engines of growth and development (Harper, 2002:11 etal, 2004:15; Ba-el and Felsenstein, 2005:28) and in many countries there has been some considerable effort to support its strategy so as to create the necessary employment opportunities, income generating and productivity capacity building. Recently developing economies in Asia, and Africa clearly shows that online marketing has a high propensity to apply technology and training

4 Problem statement In most instances individuals rely on a single source of income, which could mainly be earned from employment or a private business. The problem that arise is that single source income in most of the case fail to generate enough money to sustain all the needs and wants of individuals. Therefore it is encouraged to implement multiple incomes through affiliate marketing. This study investigates the importance of affiliate marketing that can boost more income to individuals and hence reduce financial stress.

5 Aim of the study The main aim of this study is to investigate the importance of affiliate marketing in order to diversify the sources of income for households in Botswana.

6 LITERATURE REVIEW Affiliate marketing can be defined as the strategic process of creating, distributing, promoting and pricing products for targeted customers in the virtual environment of the internet. E- Marketing is emerging as a very powerful means of communication and marketers are increasingly adopting it as part of their promotional activity. Marketers welcome e-marketing because of the ability to target individuals rather than using mass media approaches.

7 lit.continued Technology in this area is developing rapidly as more and more users get connected, as band with increases and technologies become more integrated, whether they are TV, computer or mobile based. All this provides exciting opportunities and challenges for marketers. Afuah and Tucci (2001) suggested that the purpose of affiliate marketing is to cater for the following components of business fitness: Creating customer value: by marketing its products through the internet, a firm offers more value to its customers by attempting to differentiate its services from its competitors. Scope: Internet marketing can easily indicate which markets a firm has been serving the most, which markets are growing, and which new markets is higher risk. Price: Internet can reveal through customer response rate whether the firm s products are priced to appeal to markets and also achieve company share and profit objectives. Revenue sources: it becomes ease to identify the greater source of revenue and determine whether it is plentiful enough to sustain growth and profit objectives overtime. Connected activities: Adopting affiliate marketing implies that the firm should have the capabilities of engaging onto connected services, which may include a 24/7 customer service.

8 Multiple income streams Multiple-income-stream is a term that is coined to imply instances where individuals enjoy more than one or two sources of income. There are many sources that people across the globe can turn to in order to enjoy multiple-income-streams. For example, a person can both run a small business whilst at the same time is employed. One of the most recent developments on the global markets that have presented an opportunity to individuals for earning multiple-income-streams is through affiliate marketing.

9 multi continued Knox (2011) suggested that internet entrepreneurship is one of the easy ways of earning multiple-income-streams. Internet entrepreneurship encompasses coming up with new ideas or products that can be marketed online or even finding new ways to promote an existing product or joining a new affiliate program or pursue an online joint venture. When an individual has multiple streams of income, the loss of one income stream will not devastate the entrepreneur. Conversely, when an individual relies only on one source of income and that single income source goes away, then the entrepreneur would be broke. Knox (2011) further argues that most successful internet entrepreneurs have multiple income streams.

10 RESEARCH METHODOLOGY For the purposes of this paper a qualitative approach was conducted. The research process explains the manner in which the research instrument was utilized in the whole process of primary data collection. The objective of the researchers was to gain access to the sample and attempt to maximize the response rate.

11 TARGET POPULATION According to Goddard and Melville (2001:34) a population is any group that is the subject of research interest. Furthermore, Utts and Heckard (2007:72) refer a population as the entire group of units about which inferences will be made. However, for the purposes of this paper, the target population was based on the BTC employees, which stand at 20 technical and trained internet specialists.

12 SAMPLING Terre Blanche et al. (2006:49) define sampling as the selection of a few from a population and involve decisions about which people, settings, events and behaviours to observe. It is not possible to experiment on whole population hence it is imperative to target a subset which is commonly referred to as a sample.

13 Sample procedures Questionnaires, interviews and observations are the most commonly used methods of collecting data. The researchers used the questionnaire and interviews as the method of collecting data for this paper. The researchers distributed questionnaires to fifteen (15) BTC employees with a cover letter that stated the purpose for the paper. The executive management and technical staff were asked to complete the questionnaires and inform the researchers when they were ready for collection.

14 Sample procedures continued The researchers selected a sample as follows: BTC Employees Employees Sector Telecommuni cations N (Population of technical staff at BTC) n Sample size % Percentage Total %

15 Sample procedure -Continued A sample (n) of 75% was acceptable and this gave a true representative of the total population. These fifteen (15) employees were convenient to the researchers and it was easier to use the convenient sampling method. As mentioned earlier the researchers used the convenient sampling in order to include and exclude other persons in the overall population.

16 THE RESEARCH INSTRUMENTS According to Goddard and Melville (2001:41), the fundamental criteria for data collection instruments are that they must be reliable and valid. Terra Blanche et al. (2006:286), state that data represents bits of discrete information that can be extracted from their context and analyzed as numbers. Keller (2005:19) describes three types of data. These are interval, nominal and ordinal data. Interval data are real numbers such as weights, incomes and distance. The study adopted questionnaires as the research instruments. A research instrument titled: Management and Staff on affiliate marketing in Botswana was used to gather data for the study. Furthermore, the questionnaire was structured according to five (5) point Likert Scale (Strongly Agree, Agree, Neutral, Disagree and Strongly Disagree). The questionnaire consisted of three sections. The sections were as follows:

17 THE RESEARCH INSTRUMENTS CONT... Section A personal information about the respondents Section B affiliate marketing as a strategy to the general public Section C affiliate marketing as a strategy to firms in Botswana

18 ADMINISTRATION OF QUESTIONNAIRES The questionnaires were distributed to the sampled employees of BTC. The respondents were given two weeks to complete the questionnaires. The researcher collected the questionnaires in person. The questionnaires were very easy to administer, since all the completed questionnaires were submitted at central place, where the researcher would collect them.

19 DATA ANALYSIS The data from questionnaires was analysed as the questionnaires were being received. The data was then entered into spreadsheets. Then, the data was analyzed using the Microsoft Excel; lastly the research findings were presented, combined and categorized to the objectives of this study. The use of tables, graphs and pie charts were employed during the analysis procedures.

20 ANALYSIS, INTERPRETATION AND DISCUSSION I believe that affiliate marketing will uplift the standard of living Neutral 5 Strongly Agree 8 Agree

21 The results reflected that the majority of the respondents agreed that affiliate marketing uplift the standard of living, the results were that 53% agreed with the believe and 34 % strongly agreed with the phenomenon of affiliate marketing. This shows that the study agreed with the objectives of the researcher that states that affiliate marketing creates multiple incomes for the general public as well as firms or corporations.

22 12 Affiliate marketing can create employment to the general public Agree strongly agree 2 Neutral 0 Disagree strongly Disagree

23 The graph 2. above indicated that affiliate marketing create employment to the general public. This was as a result from the findings that showed a respond of 67% and 20% of the respondents agreed and strongly agreed with the statement. This means that in Botswana the government should encourage the public and firms to use affiliate marketing as a strategy to generate multiple income.

24 12 Affiliate marketing reduces household financial stress Agree Strongly Agree 2 Neutral 2 Disagree Strongly Disagree

25 The results indicated that 74% of the respondents agreed that affiliate marketing reduces household financial stress. It is true that affiliate marketing reduces household financial stress because the housewives will earn extra income through different projects using internet marketing.

26 Affiliate marketing reduces the level of poverty 2 Strongly Agree 9 Neutral 4 Agree

27 The results indicated that 60% of the respondents were neutral to the statement and this reflected that the level of understanding affiliate marketing in Botswana is still very low. Some people are too sceptical about affiliate marketing and hence they lack confidence in regards to this concept.

28 Firms in Botswana use affiliate marketing 3 Disagree 2 Strongly Agree 4 Neutral 6 Agree

29 The results indicated that 53% of the respondents agreed that firms in Botswana use affiliate marketing. The results show that affiliate is known in the firms in Botswana and what is needed is to strengthen the strategy and concept.

30 SUMMARY The main aim of the study was to investigate the importance of affiliate marketing as a means of increase income and wealth in Botswana. The study also attempted to establish whether there is a relationship between affiliate marketing and increase in wealth. The methodology used was a survey study of the BTC technical staff in Botswana. Data was collected using the questionnaires and interviews. The data was analyzed in chapter four and in this chapter the research will draw conclusions and recommendations.

31 KEY FINDINGS The study established that affiliate marketing and internet marketing assist individuals and firms in generating multiple incomes. Therefore, affiliate marketing and internet marketing enhances the country in improving the gross domestic product. Furthermore, affiliate marketing creates more employment opportunities. From the study affiliate marketing is a source of extra income for house wives and hence reduces the levels of financial stress in the household. It was established that firms improve their market share as well as productivity if they use affiliate marketing and internet marketing in their businesses. This study focused out that there is a strong relationship between affiliate marketing and standard of livings. Individuals and that use affiliate marketing and internet marketing benefits in terms of multiple source of income. The research also indicated that the study established that affiliate marketing and income generation plays a pivotal role in enhancing the growth of the economy. Affiliate marketing and internet marketing have been established as key to organizational performance. The study also reveals that the market share of firms in Botswana can grow if there is diversification in terms of products or services. The study also established that firms and individuals in Botswana must appreciate the use affiliate marketing strategy. Despite the general understanding of principles of affiliate marketing, the study reveals that there is a serious gap in the firms and general public as far as training intervention is concerned. The study also established that firms take great exception to affiliate marketing strategies and issues. Investors want to invest in well managed companies that generate multiple incomes so that they can maximize their returns. Furthermore, very little investment from external investors is coming through into the Affiliate marketing in Botswana. This could be attributed to lack marketing techniques and performance as evidenced in chapter four of this study.

32 CONCLUSION Most studies carried out on affiliate marketing strategies are aimed at enhancing company performance and customer requirements. From the descriptive data in this study, it is established that affiliate marketing strategies affect performance and growth of firms and individuals in Botswana. Research findings revealed that most firms are strategically positioned but they fail to use that competitive advantage in their businesses and households. It was also revealed that most firms and households are failing to penetrate regional and global market. The research also revealed that firms were not aware of the main purpose of multiple incomes. The individuals and firms in Botswana must adapt the affiliate marketing strategies so that they will be growth in the country and hence reduce the level of poverty as well as the unemployment rate.

33 RECOMMENDATIONS This study revealed that affiliate marketing strategies are important to households and firms in Botswana hence are a key to the success of the economy. In order to see the importance of affiliate marketing strategy in Botswana one should consider the following: Strategies to support affiliate marketing should be developed and targeted to households and firms. Full time house wives should be involved in affiliate marketing strategies so that they can earn whilst at home. The government should promote affiliate marketing strategies in order to reduce the level of poverty. The cost of internet marketing should be subsidized by the government to cushion the firms and households. Training and development on affiliate marketing should be instituted by the government of Botswana. The government should inject funds into firms and households who adapt to affiliate marketing strategies.

34 RECOMMENDATION CONT.. The study also shown that programmes on youth participation in affiliate marketing strategies have not yet borne the desired outcomes. This calls for a holistic approach to be taken regarding youth entrepreneurship development in order to strengthen their participation in business and income generating. This can be done by strengthening training, mentoring and benchmarking of business owners in order to assist them to acquire requisite business skills. Further, it is now widely recognized that the education system should incorporate affiliate marketing programmes as part of the curriculum in order to inculcate entrepreneurship in youth at an early stage of their development. It is also recommended that the work of Junior Achievement Botswana, which focuses on these issues, should be extended to cover the whole country. The government should take initiatives in the provisions of computers and internet throughout the country so they the whole population of Botswana will benefit from affiliate marketing and internet marketing. House wives should be educated in terms of the benefits of affiliate marketing in order reduce the financial households stress. The larger corporations should initiate in developing small firms and households in terms of affiliate marketing as part of their social corporate responsibility.

35 RECOM. If firms and households adapt to some of the above recommendations they will be able to generate multiple incomes and hence accomplish their intended goals. Furthermore, they will lure both local and foreign investors hence gaining a bigger market share. This research proves that affiliate marketing promotes multiple incomes and improves the standards of living of people in Botswana. Firms and households in Botswana should adapt affiliate marketing because the research proved that there is a corelationship between affiliate marketing strategies and the growth of the economy.