Why Affiliate Marketing is poised to grow significantly in Canada

Why Affiliate Marketing is poised to grow significantly in Canada

As ecommerce continues to grow and as competition for consumers becomes increasingly expensive, brands, retailers and online businesses are constantly in the hunt for more effective and affordable ways to reach consumers. Other methods of marketing besides search marketing, online advertising or social media marketing are being sought after to determine if reaching consumers can be done with less cost or better effectiveness. Affiliate Marketing is one of those methods.

More and more Retailers are seeing Affiliate Marketing as a viable marketing channel given that it can represent anywhere from 10-20% of online sales and the cost to support a successful Affiliate Marketing program is more manageable in comparison to other forms of Marketing. In Canada, however, Affiliate Marketing is not as well known, as used or does not receive the same attention as it does in the USA or the UK. The reasons why are many and beyond the scope of this article. However, what follows are some of the reasons why Affiliate Marketing is poised to break out in Canada.

1. Continued growth in eCommerce in Canada
The $21.61 Billion generated from ecommerce in Canada last year is only 4.5% of total retail sales. In comparison, US eCommerce runs at 5.8% of total Retail sales and the UK at 11.7%. Canada has a lot of room to grow. As ecommerce grows, not just in dollar volume but in percentage of overall sales, so does Affiliate Marketing.

2. More eCommerce selection in Canada.
The majority of ecommerce purchases in Canada are derived from only a handful of well known retailers. Thus limiting consumer selection and retailers to promote for affiliate publishers. However, a number of online ecommerce platforms are enabling thousands of independent ecommerce stores to launch with more ease and less cost in Canada. Many of which have Affiliate Marketing in mind from the beginning.

3. Continued growth in mCommerce
There’s no stopping the mCommerce train. Given that over 60% of Canadians have a smart phone (higher than the global average), over 60% access the internet regularly using their mobile device and that some eCommerce sites have shown mobile purchases surpassing 40% of sales, then it is inevitable that more and more mobile affiliate publishers and technologies are created in order to benefit and leverage all this mobile activity.

4. Growth in the supply of Affiliate Publishers
Publishers are the ones with the connection to the consumer and what enables Affiliate Marketing to be a powerful marketing vehicle. However, there simply aren’t enough of them in Canada. As more affiliate revenue opportunities emerge, potential publishers are realizing that there needs to be a larger supply of quality content or niche publishers that Retailers can count on.

5. The continued growth of the Deal & Coupon industry
Many in the retailing industry simply do not realize the powerful impact Deal & Coupon providers have at reaching consumers. That industry collectively reaches about 7 million consumers in Canada or about 30% of Canadian consumers. Consumer reach is outstanding. It is no wonder that some of the top Affiliate publishers in Canada are Deal & Coupon providers and they continue to expand and grow as consumers continue to seek them out demanding even more deals and coupons.

6. International Brands expanding into Canada.
As international retailers continue to enter Canada, more are doing so through affiliate channels to support their marketing efforts.  This model allows access to local knowledge, analytics and buying behavior and acts as a test before committing further resources.

7. More Affiliate Marketing events, services, consulting and initiatives in Canada
The more events, advice and services that are produced in Canada that promote the concept of Affiliate Marketing, the more attention the concept will garner from the retailing and publishing community. Presently, there are only a handful of Affiliate consultant services in Canada and very few online resources on Affiliate Marketing specific to Canada. However, most retail or ecommerce conferences in Canada have finally started to include Affiliate Marketing into their content/speakers/panelist/partners, although there isn’t an event dedicated to Affiliate Marketing in Canada; we, along with the Affiliate Marketing Association of Canada and others in the Canadian Retail industry are trying to determine if a Canadian Affiliate Marketing Event can be produced. Initiatives like Canada’s National Deals & Coupons Month also help to provide even more attention to the affiliate marketing industry.

At the moment, Affiliate marketing is one of the fastest growing online marketing strategies. More online businesses are attracted by the fact that 10-20% of their online revenues can come from a performance based model like Affiliate Marketing. As more online businesses grow and launch in Canada, also look for healthy growth in Affiliate Marketing in the country in the upcoming years.

For further details on Affiliate Marketing, please contact the Affiliate Marketing Association of Canada.