According to an IBEF report, India's e-commerce industry is growing rapidly and is expected to reach $111 billion by 2024. From groceries to furniture, online shopping is becoming increasingly popular among Indian consumers, mainly in tier 2 and tier 3 cities.
India already has 125 million online shoppers and is expected to reach another 80 million by 2025. This growth is driven by affordable smartphones and data plans, encouraging increased investment from retail. Driven by improved customer experience and wider access, online retail is projected to account for 10.7% of India's total retail market by 2024.
As the new e-commerce sector continues to grow steadily, it faces challenges in the competitive landscape and marketing strategies. Going beyond mere promotion, new e-commerce platforms seek engagement and ROI to succeed in the increasingly competitive Indian market. Often, without a dedicated marketing department or adequate budget, they opt for the ineffective “shotgun and prayer” approach, wasting resources. Amid evolving trends, e-commerce platforms need to constantly choose the best marketing solution. Among them, affiliate marketing stands out as the preferred choice for new online businesses.
Affiliate marketing is a strategy whereby a company pays affiliates for attracting customers through their promotional activities. Affiliates promote products or services to their followers and receive a commission for successful sales. A commission is earned when a customer purchases a product through an affiliate link. Thus, affiliates act as agents of the company and earn a share of the revenue.
Affiliate marketing's performance-driven approach has brought it great success across a variety of industries, from subscriptions to products. It's especially attractive for small businesses and online businesses, serving as a valuable outsourced marketing channel. Leveraging our expertise, companies can reach their target market efficiently and save resources. This cost-effective strategy increases traffic and effectively boosts profits.
How can affiliate marketing be an effective solution for new ecommerce businesses?
Genuine Recommendations: In today's digital environment, consumers rely heavily on social proof when making purchasing decisions. Publishers with engaged followings have a lot of influence over their audience. Therefore, recommending an affiliate product gives credibility to both the product and the brand, which ultimately influences purchasing decisions.
Increased ROI: Affiliate marketing, unlike traditional marketing, offers a higher ROI by paying commission only on sales. Determining ROI is often uncertain. But affiliate marketing's performance-based model ensures profitability. Small and new online businesses prefer affiliates because they pay only for closed sales, not for clicks or impressions. This gives them direct access to a receptive audience, resulting in more sales.
Brand awareness and reach: online Businesses want broad recognition. Affiliates increase brand awareness and reach by driving traffic to their websites. Affiliates earn revenue share, become loyal advocates, and build trust with potential customers. Advertisers can reach new markets because each affiliate already has an audience. This effectively expands brand reach.
Data Tracking: Affiliate marketing tracking provides important insights into customer origins and purchasing behavior that can be easily accessed through affiliate tracking. This data helps businesses optimize their websites to increase conversion rates and work efficiently with top publishers.
Improve your SEO: Affiliate publishers link to brand websites to increase business visibility and improve SEO and organic rankings. Quality content from top publishers boosts SEO and sharing engaging content benefits both. Websites like LinkMyDeals facilitate this by publishing e-commerce offers on numerous coupon platforms, generating backlinks to increase domain authority and brand awareness.
Affiliate marketing significantly impacts brand awareness and sales, increasing product exposure. A strong affiliate network is beneficial for new online businesses, but carefulness in choosing a partner is essential. This is where affiliate marketing agencies come in, helping new e-commerce platforms make informed decisions within their budget. Additionally, to enhance their affiliate marketing efforts, new e-commerce platforms have access to tracking and optimization tools to monitor and analyze campaign performance in real-time.
(The author is Chief Technology Officer and Director at Sellergize)
Published: Monday, June 03, 2024 10:55 AM IST
