Nearly 48.4% of the internet users in the world belong to Asia. India stands 3rd among the countries with maximum internet users. Moreover India still has the lowest internet penetration but with the highest growth rate Year on Year.
The above data is the clear indicator that industries which are dependent onInternet have a tremendous growth potential in years to come. One such industry is affiliate marketing industry. An industry can only be successful when the best global practices are followed. Indian Affiliate Industry just like e-commerce industry is still in thenascent stage.
Following are a couple of best practices which I feel are missing from the Affiliate Industry in India:
1. Well Defined Payment Cycle: This is one of the biggest hindrances for the growth of affiliate industry in India. Internationally there is a well-defined payment cycle, the payment to the publisher from the ad network and from the merchant to ad-network is done anywhere within 15 to 30 days. But in India the merchants make the payment to ad-network and ad-network to publishers anywhere between 60 to 120 days.
Delay in payment creates a situation for publishers where they cannot plough back the same money in the system. If the payment was made within 15-20 days the publisher would have then been in the position to scale up the operations and thus send more transactions to the merchants.
2. Absence of Regulatory body: In India, there isn’t any regulatory body to govern the industry. The functioning of the industry works more on Ad hoc basis. But In the UK, IAB-Internet Advertising Bureau governs the industry and set guidelines for all stakeholders- Merchants, Adnetworks, and Publishers. Regulatory body helps to also keep checks and balances of the industry.
3. Open platform for merchants: Ad networks in India do not have the technology to facilitate the direct coordination between publishers and merchants. In India, Merchants communicate first with the Ad-networks who have to manually then communicate to publishers. International players like Commission Junction, ShareASale etc. are more like an open platform where merchant can directly communicate with the publisher through the dashboard.
4. Integral component of Online Marketing: In India, merchants still do not consider Affiliate Marketing as one of the key components of digital marketing. According to industry estimates Affiliate Marketing in India contributes to about 10%-15% of the overall revenue of e-commerce portals.
Thus, it is high time that merchants take affiliate marketing a lot more seriously.
5. Transparency in the process: There is a lack of transparency in the industry. A publisher is clueless as to how many sales were invalidated or rejected and for what reasons.
6. Functioning on Ad hoc basis: In India merchants abruptly end the campaign by sending a mail to Ad networks. This leads to lots of confusion among publishers on which campaign is currently active. Globally merchants inform ad networks 10-12 days in advance before stopping a campaign.
It is a just a matter of time that India overtakes China as the country with the highest number of internet users. But before that happens, it is imperative that the Affiliate Industry becomes more of an organized sector.
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