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Resilience in Affiliate Marketing During COVID-19: Letter From Gen3

Mar 24, 2020

The following letter is from Co-CEOs Mike Tabasso and Andy Cantos detailing the performance of Affiliate Marketing strategies today during the COVID-19 virus pandemic.

We hope that you, your staff, families, friends and neighbors are all healthy and doing well during this unprecedented time. We work in a relationship business and do not take for granted the strong partnerships and sincere friendships we have built with each of you over the past 13+ years.

As we learned firsthand during the financial crisis of ’08, the affiliate marketing channel is a resilient one and can be leveraged to cost-effectively help companies successfully navigate times such as these. In the spirit of transparency, we wanted to share some initial data regarding how companies in various verticals have fared thus far this month in order to provide a barometer for your business.

“…sales rebounded and were up nearly 30% for trailing 7 days ending March 22.”
A large network partner of ours, Pepperjam, has analyzed performance in 10 retail categories comprised of 685 retail brands for the month of March and across all retail categories, affiliate gross merchandise sales are up 11% YOY. While sales declined -21% for the 4 day period ending March 13, sales rebounded and were up nearly 30% for the trailing 7 days ending March 22. Breaking these results down by category for March month to date versus the comparable prior-year period:
  • Clothing & Apparel +3%
  • Home & Garden +29%
  • Health & Beauty +58%
  • Sports & Fitness +8%
  • Travel –62%
  • Accessories & Jewelry –26%
  • Food & Drinks +107%
  • Art, Photo & Music +16%
  • Gifts +76%
  • Electronics +58%

Using a more granular view, Gen3 performed a similar exercise with nearly 100 of our retail clients comparing week over week statistics and the data aligns with Pepperjam’s analysis above.

Given our experience of ’08, the data is not surprising. While certain industries are less immune to the current market environment, the affiliate channel has proven to be successful during times of economic uncertainty for at least three reasons.

3 Reasons Why Affiliate Marketing is Resilient

First, the affiliate channel is purely pay-for-performance and the advertiser determines in real time what they are willing to pay for a sale; you have total control over channel ROI.

Second, as consumers become more cost-conscious, many companies will become promotional and will need to rely on large affiliates that are very adept at getting promotional messages out.

Finally, as companies will need to broadcast messages out to the largest number of potential shoppers, they benefit from leveraging the expansive models that affiliates use to promote their advertisers, from on-site promotion to email, social media, paid search, shopping feeds and more.

Given our experience of ’08, the data is not surprising.

We appreciate our partnership with each of you and will continue to provide transparency as more data becomes available. We pledge to work tirelessly to continue to successfully promote your business through the affiliate channel.

Wishing you good health and much success,

Mike and Andy

 If your business is among the many experiencing hardships and considering Affiliate Marketing to help rebound performance, reach out to start a conversation with us today.

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