According to the annoual Affiliate Marketing Buyer’s Guide from e-Consultancy, the affiliate marketing industry in the UK generated more than £3 billion in sales last year. The industry is reported to have grown by about 45% . The commisions and fees paid out by merchants [to networks and affiliates] also grew 40% in 2007 to about £186 million compared to £133 million in 2006. Effectively, the commisions and fees account for a little over 6% of sales generated by the affiliate channel.
Four vertical segments drive the affiliate marketing channel- financial services, retail, telecoms and mobile phones and travel. Hardly surprising, since these are among the most active verticals where e-commerce is quite common. One of the trends noticed in 2007 that the report points out is that cashback and reward sites have tended to be more effective for affiliate marketers compared to “paid search” affiliates.
The growth in affiliate marketing is in line with the growth overall in e-commerce in the UK. Online sales in 2007 were over £46 billion, a whopping 54% more than in 2006, according to stats from IMRG. If we were to look at these two sets of stats which have come from different sources and put the two together, it looks like the affiliate channel is still a very small piece of the online sales pie. Question is, can affiliate marketing begin to take a bigger share?
I saw another news report that is already projecting another 50% growth in online sales in the UK next Christmas. Too early to make such a forecast, isn’t it? While I’d love for that to be the case, I prefer to be conservative for 2008. There are a bit too many dark clouds looming over the global economy this year to be overly bullish at this time….





Affiliate marketing generated over £3 billion in sales in 2007 - Read More...