The affiliate marketing industry is undergoing some of the biggest changes in its history. Revolutionary advances in digital technology and unprecedented regulatory changes are touching the lives of affiliate marketers and advertisers in ways we could never have seen just a few short years ago.
Finding new applications of artificial intelligence and the implementation of the EU’s new GDPR guidelines are expected to turn the industry on its head. A new model that focuses on decentralization will also impact the profession. Here is an overview of these jolting changes that marketers must be prepared for in 2018 and beyond.
The use of decentralized data in online marketing
Blockchain was developed to authenticate bitcoin transactions. The technology is being used increasingly in other industries as well, including affiliate marketing.
Attrace is the first affiliate network to find an application for this technology. Attrace uses blockchain to prevent fraud, improve transparency, minimize the bureaucratic infrastructure of their network and process payments in real-time. Their decentralized, blockchain-based solution is able to deliver services at a 95 percent lower cost than other networks.
Once we see one organization start to take advantage of what blockchain and decentralized technology can bring to the world of online marketing and lead generation tracking, it will only be a matter of time before this spreads across the industry.
Artificial intelligence provides fascinating new insights
Newbies and intermediate affiliate marketers tend to be too detail oriented. They spend countless hours testing new offers, creating content and looking for new traffic sources. More experienced marketers understand importance of looking at the bigger picture. They must observe trends to anticipate new changes, such as the types of offers that will be profitable in the future and which traffic sources will be most profitable in the future.
Artificial intelligence has given birth to a new field known as predictive analytics. A number of affiliate marketing experts are using predictive analytics to bolster their profitability.
Performance Horizon is a pioneer in this area. Last year, they announced that they were building a new AI platform to help brand’s forecast future changes. The new platform will also simplify tracking, optimizing and brokering traffic.
ContentSquare is another company that has started using AI to understand customer behavior for digital marketing. They received $20 million in seed funding a couple of years ago.
It is still too early to understand the final impact artificial intelligence will have on the affiliate marketing industry, because the technology is evolving at a very rapid pace. However, it is clear that it will change the industry in surprising ways.
Last month, the European Union finally enacted the GDPR. This is a new data protection framework that officially replaces the Data Protection Directive that was adopted back in 1995.
The new law has a number of data protection guidelines that affiliate marketers must be aware of. Payoneer published a blog post that provides an overview of the policies that affiliate marketers must understand regarding this new law. These changes include the following:
More limited targeting capabilities
The GDPR places strict limitations on how much marketers can personalize their ads. Facebook and Google have already introduced new policy changes to compliance. In March, Google announced that it will limit processing of any personal information about minors, as required under the GDPR Age of Consent requirements. They also released a new solution for publishers that only want to display ads that do not include personalized information on customers who didn’t consent to data collection for targeting. Facebook has stopped processing newsfeed posts for targeting ads, except when the ads are marked for the general public or friends of friends. The company made this change because those types of ads usually depend on demographic data that is included in the “special categories of data” provision under the GDPR.
Other advertising networks are still implementing new changes in response to the legislation. Some advertising networks that affiliate marketers use most heavily have stopped serving ads to EU countries altogether.
Direct marketing strategies require clear consent
The GDPR has strengthened the rules of consent for marketers reaching EU customers. Any marketers that intend to deliver personalized ads must get explicit permission from their customers ahead of time.
Data transparency and opt-out requirements
In the past, marketers didn’t need to spend too much time focusing on the location of customers that shared personal data with them. They simply provided a standard consent form to customers that visited their webpage. Policies are much stricter under the GDPR.
Organizations that collect data must explicitly tell customers what data they are requesting and how they intend to use it. Customers must provide clear consent before the data can be collected. The brand must also provide an option for customers to opt out, receive copies of their data or have records of the data destroyed at their request.
Affiliate marketers cannot assume that they are immune from these new standards, even though they are not the final brand the customer is interacting with. They must be transparent about using any third-party tracking software to collect personally identifiable information on customers, including IP addresses. They need to be required to delete these entries from CPVLab, Prosper or other third-party tracking solutions they use.
Meeting the standard can be complicated enough if you are running direct linking campaigns as an affiliate. It becomes even more complex if you are building an email list or running another complex funnel that requires you to collect personal information. Make sure you have a simple way of collecting data reports and deletion requests so you can respond in a timely manner.
Affiliate marketers are embracing the tides of change in 2018
The affiliate marketing profession is facing some of the biggest changes in 2018. New digital technology and the EU’s revolutionary data protection guidelines will have a tremendous impact on the future of the profession. Savvy marketers must take the time to research the implications of these changes and respond accordingly.