Interview – Affiliate marketing is financial freedom
Kipp talks to Director of Performance Advertising - ikoo, Mohammad Khartabil about the raw benefits of Affiliate Marketing and Middle East’s potential for catching up…
September 27, 2012 11:24 by Muhammad Aldalou
One of the many doubts constantly gnawing at the sanity of a business is the struggle to fully optimize its advertising potential, effectively creating a strong brand image while simultaneously spreading constant awareness. Do we go for traditional advertising, radio time, social network interaction, paid posts on Facebook or Twitter? Is online advertising as effective as the portals make it out to be?
Affiliate Marketing may seem ‘undiscovered’ in this region but according to Khartabil, it has a mountain of potential.
For those who aren’t too familiar with the process, describe Affiliate Marketing in a nutshell.
In a nutshell, the affiliate marketing ecosystem comprises of affiliates or publishers, networks, and merchants or advertisers. These components of the system interact to increase the conversions a merchant or an advertiser makes online for a product, whether it is a sale or a newsletter sign-up.
In layman’s terms, Danny is an affiliate who owns a financial website, with traffic from users interested in financial products. John is the marketing manager of a regional bank and always on the lookout on how to reach customers online interested in their credit cards. The network plays the middleman who connects both, where Danny gets paid an agreed upon amount every time John gets an interested customer online.
Which countries in the world are the leading users of Affiliate Marketing?
As with other digital channels, the US & Europe (predominantly the UK) are the leading economies in Affiliate Marketing. Despite the increasingly global nature of affiliate marketing, there are some apparent differences between the US and UK markets, as well as some similarities.
Is it a well recognized form of marketing in the Middle East/Dubai or still in the introduction phase?
In the Middle East, affiliate marketing is still at its early stages, but with huge promise. As per the 2011 Forester report, affiliate channels had the third largest allocation in online marketing budgets in the United States, while the 2011 IAB Internet Advertising Revenue Report noted that 4.8 percent of online ad spend in the United States was towards generating leads.
Some early adopters of affiliate marketing in the Middle East include the likes of Bayt.com, which is one of the few merchants with an in-house program. Other advertisers, such as Emirates Airlines and Etihad Airways, have opted to use bigger international networks to manage their affiliate programs. New models are also emerging regionally for affiliates, which are monetizing their sites and utilizing their expertise in online marketing by adopting affiliate marketing programs. Examples include the coupon site VoucherCodesUAE, the price comparison site Meefind, and Pay per click (PPC) expert Zalds.com.
Journalists and media publications unintentionally provide promotion for products and services all the time, but naturally most of them don’t get paid for it. Is that not called Affiliate Marketing?
No it is not, because the main concept in Affiliate Marketing is when the advertiser agrees to pay the Affiliate, which is the media publication or the journalist in this case, an amount for any customer that is referred. So actually, there is an opportunity here for media publications and journalists, to actually monetize their efforts, through simply using, if available, affiliate links where appropriate to generate earnings out of it.
There is a lot of negative talk about corporate hesitancy towards online marketing and advertising in the Arab region. Do you see that changing soon?
Regardless of the current share of online advertising from overall marketing budgets, the answer is yes. There are reasons for the hesitation raised in the question, which is understood yet this could easily be changed, since company culture plays a major role in preventing further investments in the digital front. But education is key, through agency efforts and the growing talented digital teams. As marketers continue to measure the return on investment and effectiveness, investment in digital will be rapidly growing in the Middle East.
What makes Affiliate Marketing stronger than traditional online advertising? Is there a guaranteed return on investment?
Affiliate marketing’s key advantage is that it is not based on estimates. Rather, it quantifies actual results, which means that a marketing program’s effectiveness is accurately determined and advertisers get exactly what they pay for. It is important for an advertiser to have an affiliate marketing strategy in place, whether it is geared towards more leads or sales. Advertisers only pay for results, hence guaranteeing ROI with very little risk.
What are the main benefits gained through Affiliate Marketing that you wouldn’t get from other advertising methods?
As an advertiser with no startup costs, Affiliate Marketing is cost-effective and has zero risk. In addition, having the ability to increase customer base by paying only for those you gain is a major benefit, backed up by powerful and transparent affiliate tracking software which offers quality and control.
As an affiliate, gaining financial freedom is a core benefit of engaging in affiliate marketing. This requires patience through opting to start affiliate marketing in a certain niche that works well for you as an affiliate. This can also act as a source of earning higher income, not as an alternative to other streams, but as an additional stream.
How do you begin to find “Affiliates”?
There are different ways to find, or what is called in affiliate marketing terms, “recruit” affiliates. Reaching out to affiliate differs from one type to another, but in general the ways are, though not limited to; forum announcements, the use of SEO, running PPC (Pay per Click) campaigns, Twitter, Facebook, links, conferences, referrals, and most importantly word of mouth.