Australians lagging behind in affiliate marketing adoption – that’s about to change
Affiliate marketing has grown into a multi-billion dollar global industry – but in Australia the concept remains shrouded in suspicion, largely misunderstood by consumers. Its share of the larger e-commerce market is only a fraction of that of China or the United States.
Affiliate marketing is a system in which a business or person can earn a commission or reward for marketing another person’s product or service. Spending in the United States alone is expected to reach over $ 8 billion by the end of next year, Statista says, three times the rate of a decade ago when it started to take off. .
Findstack records that affiliate marketing now accounts for over 16% of digital media revenue in the US and Canada, and about 80% of brands have affiliate programs. About a quarter of affiliate marketers work in the fashion industry.
So, with such adoption in markets like North America and mainland China, why is the industry still in its infancy in Australia?
Nicole Gassett, marketing manager at Australian affiliate marketing startup BuyersCircle, thinks it’s because Australians are a little more cautious. âWe need more time to trust. I’m from the United States, so I see both sides of the coin, but in terms of the affiliate marketing landscape, in Australia it’s still a bit of a taboo subject.
She thinks a lot of people confuse the concept with multilevel marketing, but the two concepts are totally different business models. With multilevel marketing, people buy products from a supplier and resell them, creating a chain of people often relying on friends and family to maintain steady sales. Affiliate marketing offers a lot more product diversity and is about recommending a product on their website, blog, or social media platform. People can order the product from a brand or a wholesaler, the recommender gets a commission.
âSo this kind of buying-sharing concept is pretty amazing, because we’re finally at a point where it’s socially acceptable to be rewarded for giving great product recommendations. We want to make shopping a more social experience, not just a transactional one. ”
The key to successful affiliate marketing is that all sellers recommend or review a product. A mother in suburban Sydney could share a new infant food product with her parenting support group, including a link to purchase the product. Its role in the transaction is simply to share information. With her own credibility on the line, she’s unlikely to recommend a bad product to friends or coworkers. The sourcing, warehousing, shipping and transactional stages of sale are all handled by a third party.
How Affiliate Marketing Can Benefit Existing Retailers
As BuyersCircle continues to grow as quickly as it has, the company hopes to attract existing retailers who want to expand their product offering. Gassett says there is a huge opportunity for brands and retailers to get involved in affiliate marketing because it saves them the trouble of running their own ecommerce store.
âIt’s really disheartening for me to see so many ecommerce startups fail, to see people sell all their inventory and give up because they’re too stressed out and the whole process is just too long. At BuyersCircle, we also make it easy to start a business. They don’t have to worry about the overhead costs of transporting inventory.
âIf you take that overhead off and just let them do what they do best – network and share products they love and products they are passionate about – they can better maintain a successful side business through the affiliate commission. “
In Australia, it takes less than five minutes to open an online affiliate store on BuyersCircle by simply downloading an app through Google Play or the Apple Store. Store owners manage what they store virtually (from BuyersCircle inventory), link to their store, recommend, and share as they see fit. There is no minimum turnover to maintain the store, and no registration fees as multinationals generally impose. Payment, delivery, and logistics are handled by BuyersCircle, and the store owner receives a commission on sales – or they can have their commissions paid to a charity of their choice.
BuyersCircle offers around 4000 products through its dropshipping suppliers, two warehouses in Sydney and Melbourne, as well as their warehouses located in the Melbourne and Sydney markets to supply fresh produce. Its offering ranges from fresh food, alcoholic beverages and groceries to electronics, clothing and household items.
Early next year, BuyersCircle will be live on Shopify, so any retailer with an existing store on the platform will be able to sell products from BuyersCircle inventory as well.
An influencer of influencers?
In the long term, BuyersCircle aims to establish itself as an influencer in its own right. He analyzes industry trends, changing product demand and changing categories to determine which products to add to his inventory, taking into account recommendations from retailers and buyers.
âI think people look to companies like us to be the thought leaders in what they should buy what they should be doing. So it’s important for us to always do a lot of research on global trends and people’s needs and look at environmental factors.
Gassett says affiliate marketing isn’t really new and offers a simple challenge. Think about it: what’s the last product or service you recommended to someone? We’re all affiliate marketers – it’s just that most of us don’t get any rewards.
- Learn more about BuyersCircle – Australia’s leading social ecommerce platform that connects the community in the most convenient way to shop, share and earn money.