CAPITALIZING ON THE MOBILE OPPORTUNITY IN AFFILIATE MARKETING

Transcription

1 CAPITALIZING ON THE MOBILE OPPORTUNITY IN AFFILIATE MARKETING June 2015

2 Contents Understanding the Biggest Opportunities in Mobile 4 Mobile Commerce (mcommerce) 4 Location-Based Mobile Tracking 5 Cross-Device Tracking 5 In-App Events 6 Google s Algorithm Update (and What It Means for Affiliate Marketers) 7 The Big Impact of Big Data on Mobile Marketing 8 Is Your Organization Positioned for Mobile Domination? 9 2

3 Mobile is no longer a nice-to-have component of performance marketing it s a critical ingredient of success. Discover the trends defining mobile, and find out how your business can leverage this massive digital marketing opportunity. When Apple first launched the iphone in January of 2007, even visionary CEO Steve Jobs couldn t have anticipated the enormous impact the device would have on the world. Within a year, the company had sold nearly 10 million phones. By 2011, iphone sales totaled more than 100 million. And, as of early 2015, the tech company s total mobile device sales including ipads exceeded 1 billion. While those numbers may seem staggering, the truth is that they are actually dwarfed by the broader mobile market Apple spawned. For instance, more than a billion Android devices had been shipped worldwide in 2014 alone. 1 And by the end of 2015, Cisco s recent Global Mobile Data Traffic Forecast suggests that the number of mobile-connected devices will exceed the number of people on earth. 2 Simply put, the relatively small mobile fire Apple started in 2007 has officially turned into a full-blown conflagration. Many industries have already successfully leveraged this mobile revolution by building entire business models and go-to-market strategies around the mobile ecosystem. But one channel brimming with enormous opportunities to capitalize on this trend is affiliate and performance marketing. Consider these statistics: By 2016, emarketer predicts mobile advertising spending will top $100 billion and will nearly double to $195 billion by By 2018, investment bank Digi-Capital projects the mobile internet sector alone (mcommerce, mobile advertising, consumer apps, etc.) will be worth more than $850 billion $100 billion more than Apple s current market capitalization. 4 Translation: The future of affiliate marketing is mobile and the collective trend suggests 1 CNET, Android shipments in 2014 exceed 1 billion for first time, Cisco, Cisco Visual Networking Index: Global Mobile Data Traffic Forecast Update, emarketer, Mobile Ad Spend to Top $100 Billion Worldwide in 2016, 51% of Digital Market, Digi-Capital, Mobile Internet Report,

4 that the most successful affiliate marketers over the next decade will be those who successfully leverage this new frontier. That said, the question affiliate and performance marketers need to ask first is whether they re fully prepared to capture those opportunities. In the coming pages, we will help affiliate marketers understand the biggest trends and opportunities in mobile, followed by an exploration of how mobile tracking and Big Data can dramatically improve affiliate and performance marketers ROI across a variety of mobile channels. Understanding the Biggest Opportunities in Mobile One of the key challenges for affiliate and performance marketers and digital marketers, in general is grappling with the nebulous nature of mobile. Focus on the wrong opportunities, and your overall ROI will be negatively impacted. To avoid that, there are a few key questions affiliate and performance marketers must consider before launching a mobile strategy: Is it better to invest in mobile apps or the mobile web? Does mobile follow similar conversion patterns to traditional digital traffic (i.e., how are affiliate marketers compensated on mobile)? How important is mobile commerce? Why is location-based and cross-device tracking so valuable? What role does Big Data play in mobile marketing and how can I use it to improve ROI? We re here to answer those questions for you. In the sections below, we ll explore the key trends in mobile commerce, mobile tracking, mobile apps, and Big Data analytics, and provide practical advice designed to set affiliate and performance marketers on the path to mobile success. Mobile Commerce (mcommerce) As recently as a few years ago, traffic and sales originating from mobile devices represented a very small piece of the broader ecommerce pie. Today, mobile s slice of that pie is growing at an exponential rate. According to a 2014 report by ecommerce platform Shopify, mobile devices now account for more than 50% of all ecommerce traffic. 5 While conversion rates from mobile traffic remain lower than non-mobile channels, numerous studies show that those numbers are on the rise. And as more people become comfortable with making purchases on their mobile devices and more apps and platforms are designed to empower mobile commerce it s likely that mobile conversion rates will continue to rise. In fact, by 2018, Goldman Sachs estimates that mcommerce will account for nearly half of all ecommerce sales (which itself is a market Goldman Sachs predicts will then exceed $1 trillion). 6 What this means for affiliate marketers: What those numbers (and buyer behavior research) make very clear is that consumers are no longer relying only on desktops to make purchases. For affiliate and performance marketers, it will 5 Shopify, Mobile Now Accounts for 50.3% of All ecommerce Traffic, InternetRetailer, Mobile commerce will be nearly half of e-commerce by 2018,

5 become increasingly critical to ensure every aspect of their marketing efforts websites, mobile apps, advertising campaigns, etc. are fully optimized for the modern mobile experience. When this happens, ExactTarget s 2014 Mobile Behavior Report suggests that consumers are 37% more likely to make a purchase. 7 Location-Based Mobile Tracking Thanks to GPS, Near Field Communication (NFC), and, most recently, Bluetooth Low Energy (the technology that powers Apple s ibeacon), smartphones have turned consumers into walking transmitters of buying information. As a result, retailers and affiliate marketers can now create and execute hyper-relevant, locationbased marketing campaigns in near real-time a possibility that marketers only dreamed of 10 years ago. have closed a frictionless sale; and the affiliate partner is satisfied because they received a commission for their role in the transaction. What this means for affiliate marketers: The ability to create, track, and retarget mobile marketing campaigns based on a customer s location and activity allows affiliate and performance marketers to achieve two key goals. First, this technology unlocks key demographic and behavioral customer data, which can lead to more targeted and successful campaigns. And second, it opens the door to helping affiliate and performance marketers dominate online-tooffline mobile marketing opportunities. In fact, it s not unrealistic to think that, within the next decade, retailers will be able to fully track nearly all offline conversions back to corresponding online affiliates. Retailers and affiliate marketers can now create and execute hyperrelevant, location-based marketing campaigns in near real-time. What does location-based mobile tracking look like? Imagine that a consumer enters a shoe store that s equipped with Apple s ibeacon technology. This technology allows affiliate marketers to deploy a variety of campaigns such as marketing, SMS, and push notifications that automatically send a coupon for a pair of shoes. If the customer redeems that coupon at the pointof-sale, everyone wins: the customer is happy to have saved money; the retailer is thrilled to Cross-Device Tracking According to Google, 67% of consumers now conduct ecommerce journeys on more than one device. 8 In the context of your own product research and purchasing habits, that number might seem low. However, in the context of the broader ecommerce market (which exceeded $300 billion in sales in the U.S. alone in 2014), 9 it represents a significant marketing opportunity for affiliate and performance marketers. This is where cross-device tracking the process of following a specific customer s behavior and activity across all screens can be hugely powerful. Already available as a feature on forward-thinking affiliate marketing platforms, cross- device tracking drives powerful insight that facilitates more programmatic marketing 7 ExactTarget, 2014 Mobile Behavior Report, Internet Retailer, Affiliate Window launches cross-device tracking, Internet Retailer, U.S. annual e-retail sales surpass $300 billion for the first time,

6 campaigns. This information gives affiliate marketers a more robust view of user behavior and, more importantly, allows them a deep dive into the data to deliver offers and ads that are tailored to the mobile channel and device a customer uses. The resulting personalization leads to deeper customer engagement, higher conversion, and better ROI. Currently, the trifecta of tech giants dominating cross-device tracking include Google, Facebook, and Apple, all of which leverage unique variations of Single-Sign-On (SSO) technology to assemble extensive profiles of each user across multiple devices. For instance, when a Google user leverages the company s SSO option to log on to different platforms (YouTube, Gmail, Search, Google Wallet, etc.), Google can use cross-device identification rules to track users and improve the tracking accuracy of its various ad delivery services. For affiliate and performance marketers, this capability along with Facebook s and Apple s own technologies can be very powerful. Cross-device tracking automatically pulls data from every step of the customer s journey across all devices and issues appropriate attribution to each partner. What this means for affiliate marketers: One of the biggest benefits of cross-device tracking is that it dramatically improves the attribution process. As a result, affiliate marketers will not have to wonder whether an ad served on one device is attributed to a sale completed on another. Instead, cross-device tracking automatically pulls data from every step of the customer s journey across all devices and issues appropriate attribution to each partner. In-App Events Most affiliate and performance marketers recognize that mobile apps are a powerful medium for reaching customers and personalizing user experiences. The challenge, however, is that deciding to go forward with a mobile app strategy and efficiently executing one are two very different beasts. One very big challenge for affiliate marketers is that, in order to fully tap into the potential of mobile apps, they must develop versions for different operating systems and devices the big three being ios, Android, and Windows Phone. Even if they choose to focus only on ios and Android, there are still difficulties pursuing and scaling mobile app development. And then there s the challenge of measuring and tracking in-app events (such as installs, updates, opens, searches, shares, and purchases) across those devices and operating systems. The good news? Technology now exists that allows affiliate marketers to speed up the app development process by easily leveraging unique SDKs (software development kits) for each operating system. And once those apps have been deployed, marketers can integrate mobile app tracking technology that delivers real-time performance data on website conversions, mobile installs, and in-app events. Combined, these technologies empower marketers to more efficiently optimize the functionality of their app and the relevancy of their advertising campaigns. 6

7 What this means for affiliate marketers: With mobile app tracking technology, affiliate and performance marketers can more accurately determine the return on ad spend (ROAS) from different marketing campaigns and track inapp events to the referral source. This insight takes the pain out of deciding where to allocate marketing spend and unlocks serious potential in scalability. What s More Valuable: An App Install or an In-App Event? There s little doubt that mobile apps can be an incredibly powerful medium for building deeper relationships with customers, but studies show most apps fall woefully short of expectations. One reason for this is that many marketers place too much value on app installs. 10 While installs are the key first step toward capturing customers through a mobile app, in-app events often provide greater opportunities for engagement and conversion, and these events are often indicative of adoption and higher lifetime values. These events could include app opens, registrations, searches, or any number of user activities, but they generally provide rich insight into a user s true value and give affiliate marketers contextually relevant opportunities to drive conversion. With one simple interaction (e.g., a push notification or an in-app ad), customers can be pushed toward specific activities that help marketers directly measure and improve mobile app engagement and ROI. Google s Algorithm Update (and What It Means for Affiliate Marketers) If this paper hasn t already made it clear that mobile should be a top priority for affiliate and performance marketers, Google s recent algorithm update should serve as the tipping point. Designed to provide a better search experience for mobile users, Google s update termed Mobilegeddon by marketers worried that their lack of mobile prowess would negatively impact web and mobile traffic moved mobile optimization to the forefront of the digital marketing conversation. Very simply, if your business relies on mobile traffic to drive engagement and transactions (and what affiliate marketer s doesn t?), then Google s mobile emphasis could present either a significant challenge or opportunity. For marketers whose platforms and campaigns are fully optimized for mobile, Google s algorithm update was likely a blessing in disguise for searchability and conversion. Because the algorithm rewards mobile-friendly websites with higher mobile search rankings, this gives mobilefocused affiliate and performance marketers a significant advantage over their non-mobilefriendly competition. For marketers whose website content and ads are not optimized for mobile, the algorithm update may have caused significant short-term damage. After all, with smartphone and tablet usage on the rise, lower mobile search rankings will equate to a significant dip in overall traffic and conversions. 10 Google, Mobile App Marketing Insights: How Consumers Really Find and Use Your Apps,

8 If you re concerned your operation falls into that category, there are a few simple steps you can take: 1. Perform Google s mobile-friendly test. This tool delivers clear insight into how your website content ranks against a number of key criteria. creates a greater sense of urgency around making sure all of your mobile ducks are in a row. If affiliate and performance marketers take or have already taken the steps above, then they ll benefit from the algorithm change. The Big Impact of Big Data on Mobile Marketing 2. Put some thought into button design and CTA placement. Your goal should be to include high-value, converting messages at the top of pages and ensure all CTAs or ads are large enough to be easily tapped on a mobile device. 3. Pare down content on your mobile site. When it comes to mobile, less is more. Remember, the amount of space available for content on a mobile device is often significantly smaller than the space available on a desktop browser. Be sure to include only messaging that s most likely to convert and, whenever possible, reduce a visitor s need to scroll or zoom. 4. Think cross-device. As we ve already mentioned, studies show mobile customers journeys tend to span a number of different devices and screens. It s critical to ensure your mobile content from text to images to videos is capable of responsively scaling to those screen sizes and device types. Truthfully, Google s mobile-focused algorithm changes haven t created the apocalyptic scenario many marketers feared, largely because responsive mobile design has been important for years. Google s most recent update simply By now, it should be clear that mobile presents immense opportunities for affiliate and performance marketers to build deeper, more personalized relationships with customers. The challenge for affiliate marketers, however, is converting those opportunities into intelligent, data-driven mobile strategies. It should be clear that mobile presents immense opportunities for affiliate and performance marketers to build deeper, more personalized relationships with customers. That s no small feat, particularly when you consider that affiliate and performance marketers often rely on multiple third-party reporting solutions and internal databases to measure marketing efforts. Add in the ever-expanding mobile marketing ecosystem (new channels, tools, tactics, and platforms are emerging all the time), and the process of deriving truly actionable insight to inform mobile campaigns can feel overwhelming. So, how exactly can affiliate and performance marketers go about turning the incredible volume of data that mobile marketing creates into intelligence that helps them optimize their efforts? 8

9 The simple answer is that data isn t enough. In order to make the most of mobile, marketers must leverage tools and new technology that s capable of ingesting Big Data and churning out real-time advanced analytics that make the data useful. Thankfully, these platforms already exist and, used properly, they can open the door to a number of capabilities, including: Integrated Mobile Tracking: With a Big Data platform designed for affiliate and performance marketing, marketers can track app-to-app, app-to-web, and webto-app conversions on all mobile devices, including smartphones and tablets. This insight allows mobile marketers to automate campaign optimization as well as deliver contextually relevant messaging. ROAS/ROI Insights: With this technology, marketers can automatically import cost data from third party vendors to understand true return on advertising spend (ROAS) without having to log in to multiple systems. Real-Time Reporting: The best affiliate marketing platforms feature mobile app dashboards that provide insight into the performance and value of a variety of mobile activities. Marketers can assess clicks, installs, in-app events, total revenue, costs, device type, and a number of other key metrics. Simply put, these platforms free affiliate and performance marketers from the shackles of fractured or siloed data (as well as the dreaded flood of spreadsheets). Rather than having to leverage disparate solutions to piece together data, marketers can now generate the kind of real-time insight that leads to smarter mobile marketing decisions and full maximization of mobile ROI. Is Your Organization Positioned for Mobile Domination? Clearly mobile is here to stay, and its influence will only grow over the next several years. What may be less obvious for many marketers is how exactly to go about investing in mobile in ways that maximize ROAS and ROI. Since there s no one-size-fits-all mobile strategy for all affiliate marketers, there s no easy way to answer that question. However, the opportunities covered in this paper provide a sensible starting point. As your strategy progresses, consider leveraging a Big Data analytics tool to help you better understand where, when, and how customers are engaging with your mobile campaigns. The right technology will help you tap into the kind of multidimensional insight that informs smarter decisions and higher returns. Instead of blindly throwing darts and hoping for the best (the approach many marketers take with mobile), the right technology will help you tap into the kind of multidimensional insight that informs smarter decisions and higher returns. In an ultra-competitive race for mobile dominance, that level of analytical capability could make all the difference. 9

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