E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
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At Internet speed, generations can turn over in as little as months. The first generation of affiliate marketing programs offered merchants the technology to blast their offers out in a little-differentiated cyberspace. The benefit was that unlike CPM advertising, it offered the first opportunity to track any results. The next generation narrowed the field with more active management that helped e-retailers better hit the target and lifted more of the load of back-end management off their shoulders. Now, affiliate marketing service providers are branching out into expanded services that drive new accountability from a broader array of online tactics.
And that means that just as Internet retailing is more about retailing and less about the Internet, online marketing will focus more on marketing and less on the fact that it takes place online. “We started as a traditional affiliate marketer but now we look at ourselves as more of a marketing platform,” Hoffstein says. “Affiliate marketing is just one of the tools we use. We put links in e-mails, we track portal deals and we do search optimization. At the end of the day, what we do is use the tools we’ve developed to help the merchant find the right customer and convert that traffic into sales.”