Affiliate marketing drove £14bn sales to UK retailers in 2013 and constitutes 16% of UK eCommerce market. If talked about the returns in this space, then with £1billion spent on affiliates, advertisers in return are earning £14bn sales.
In India, however, affiliate marketing is still in its niche. We reach out to Jochem Vroom, Managing Director at Flipit.com to understand his outlook on the Indian affiliate marketing ecosystem and eCommerce as a whole.
Flipit is an online coupon portal which currently provides discounts in 21 countries and is expanding at a rapid pace.
1) What is your outlook towards eCommerce in India? Many are of the view that Indian market is still in its niche while others consider it capable of offering large opportunities. What’s your say on this?
India definitely has a lot of potential in eCommerce and I have high expectations for the Indian market, especially when I read about how fast it is blooming. People in India are excited and enthusiastic about eCommerce which has a very positive outlook. If I compare its niche to those of other European markets for example, I see a difference in how it operates, but once you get a grasp of what works and what doesn’t, it becomes clear that the Indian market is capable of offering large opportunities in the long run.
2) eCommerce in India is largely a marketplace driven game. Also, there are not many companies who are making money. Is there enough room for affiliate companies in this ecosystem?
We like to consider ourselves more of a performance based company, rather than an affiliate company that is driven mainly by money although entering the affiliate marketplace in India is how to start the game. As a performance based marketing company, I’m more interested in seeing how well we perform in a marketplace organically.
Affiliate companies are slowly dying out because they realise more and more that their methods of making money will not thrive in an ecosystem that is still developing, so I don’t believe that there is enough room for too many more affiliate companies that share the same methods. However, I do believe that there is room for performance-based companies to do well.
3) What role do affiliate marketing plays in process of evolution of eCommerce industry, in lieu of the growth curve of a company (seed, early stage, growth stage, Maturity)?
Affiliate marketing helps in exposing e-commerce companies more in the industry. In the early stages of any company, planting the right seed to grow depends a lot on how campaign management is setup. You need to find the right advertisers to work with and build those relationships. Your marketing strategy should be in line with that of your partners, and this takes time to realize.
This part of the growth stage involves trial and error until you find the right balance between organization, delivering unique affiliate marketing campaigns, creative content and securing partnerships. When the company begins to grow and implement its campaign management goals effectively with various advertisers and partners, results start to show. Consistent and reliable results over time reveals a company’s maturity.
4) What is your outlook for affiliate marketing in India? What are the gaps which prevail?
Affiliate marketing is still not advanced in India as it is in other countries. Some companies still prefer to use more traditional methods for their campaigns. But, those companies who are using affiliate marketing certainly do take a competitive stance, and because they all work (or want to work) with the same big names, you’ll rarely ever read about how they actually use affiliate marketing. So the gaps are actually largely undefined due to this lack of transparency, but one gap that I see is that there is not as much variety in the types of affiliate markets people end up working with in India. There are a lot of deals and discount portals obviously promoting the same products, so the key (or gap) here is in offering the best content.
5) What are the various opportunities you find in the affiliate marketing ecosystem?
That you can work with multiple merchants, that you can work with huge merchants in an easy way (without the need to communicate a lot) and that you can get it all tracked and paid by a third party. For example-we work with over 7000 merchants. It would be quite some work to invoice all these merchants / webshops. (or to even get them working with you. ) Through affiliate marketing it’s the only way possible to get this done.
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