The impact of COVID-19 on affiliate marketing

2020 has been one of the worst years when it comes to businesses as everything around the globe was affected by it. Because of the ways the disease spreads, it has left no such business that did not have a negative impact on it.

Businesses like hotels, restaurants, airlines, theatres, malls, etc. have all been closed due to COVID-19 and could not be left open for the public. Every industry is experiencing its own unique set of challenges. 

Since everything is being affected by the enormous pressure of COVID-19 there is one industry that is taking quite the hit for it and that is the affiliate marketing industry. As everyone is quarantined in their homes, affiliate marketing is dealing with disruptions to their businesses.

Many affiliate programs are cut and in many programs, the commission rates were also lowered due to loss in manufacturing and decrease in profit. Workers were getting infected with the disease and could not come for work which caused some businesses to even shut down. While some companies were shutting down, others took advantage of this as they would face less competition and risked a lot to increase the profits of their company.

Yes, surely it has had its negative effects but there have been a lot of positive effects as well. So, let’s talk about all the negative and positive impacts of COVID-19 on affiliate marketing.

If looked at statically 2020 brought growth to some companies while others suffered and saw a decrease in sales. In general affiliate marketing has grown about 20% more than it had in 2019 due to networks.

Negative impacts

We’ll be starting with the negative impacts first considering 2020 wasn’t really the brightest of years.

Although everything was mainly affected by the pandemic but out of all the categories, the most damage has happened to the categories such as Travelling and Hotels as due to lockdown no one could access it or use it. These companies would struggle to make any sales, about 90% of their bookings were lost.

Now, these companies are slowly recovering from the damage, but we can see the amount of loss they had to bear in worldwide sales. Airbnb performed much better than its competitors but according to a study, the hotel industry’s performance went downhill by about 65% at the end of June. This also affected the revenue per every available room in the hotels.

Another thing was the issue of mixed traffic on the web. Traffic is key and is basically what every affiliate marketer aims for while selling their product, they need it on their links so they can get a commission. Since COVID-19 shocked everyone and created a mess, people on the web out of fear and shock, started searching and tried their best to get any information related to the ongoing pandemic all around the world.

This created a loop for traffic and hence people avoided going to sites they would normally go to. Businesses like Uber suffered the most with about 75-80% loss as people avoided going outside and spent their time in quarantine. There was no way anyone could survive in a pandemic with such a situation.

Longer shipping times due to COVID-19 was a very big problem these e-commerce markets faced. Big companies like Amazon faced prolonged shipping times, Amazon started stopping shipments on non-essential goods for third party sellers, these delivery times started to take months which shows that everything was on survival mode.

Affiliates of amazon could not really earn any money as there was nothing to sell that could be instantly delivered. People used to avoid ordering as they could not wait for months for a single product.

Commissions were reduced and affiliate programs that were joined by thousands of people were all suspended (programs being suspended meant you as an affiliate now could not earn anything at all). As for commissions people would workday and night but would barely make enough to survive a month. 

The budgets of these many companies were cut short and since the budget was set low, salaries automatically were decreased, and some staff was removed as the company could not risk of paying so many employees. The impact of advertisements has been drastic for real estate, short term rental companies, healthcare etc. This led to a case of increasing financial uncertainty and higher unemployment.

Positive impact:

Now since we talked about all the negative aspects, we are sure you would want to know about the positive impacts too and there were quite a lot as a matter a fact.  As time spent consumers started looking for places to buy needed products without having any contact or leaving their homes. Hence something like affiliate marketing which is mainly online was the way to go.

People could order and find discounts all over provided by some companies as shipping was quite expensive due to certain limitations, they ordered stacks on things to store and not worry about it for a while. Companies often provide their affiliates coupon codes so people often used those, and the affiliates used to benefit off from them as they would be able to earn a bit of commission.

The pandemic did increase the need for economical online shopping worldwide. There was a demand and the e-commerce companies fulfilled those hence a major rise in sales could be seen and this helped the companies remain stable. 

Affiliate marketing was the one thing that helped affiliates survive in the pandemic as people did not have to go outside to earn money unlike the majority of people who were now suffering the consequences. 

The one thing that was seen a growth in were health orientated items such as immunity boosting vitamins, cough syrups and much more were seen to the have the biggest conversion rates during the first month of COVID-19. For such thing’s companies like Amazon, OnlineRxMaster started putting offers for such products to increase sales.

Indoleads helped a lot by giving many people the chance to become affiliates and earn some money through these hard times. It provided with the best affiliate programs with a wide range of categories that one could pick from and join according to their audiences.

Due to people not wanting hand to hand shopping, people were actually recommended to use online digital markets as it was easier and could be accessed even by mobile phones. About 45% of all digital shopping is done through mobile phones as everyone has access to them and it has become super-fast and reliable.

At one point due to the pandemic a lot of people did riots and a catastrophe  was all around the country where people would loot and take all the essentials that were needed to survive, this made it harder for other people to get these products which devasted the consumers, hence affiliate marketing gave consumers hope by introducing these products in acceptable prices.

Let’s talk about stats a bit so we can decide if the impact of COVID-19 on affiliate marketing was good or bad. 

According to Bazaarvoice which surveyed over 5000+ consumers in various countries across the globe to learn more about shopping statistics found out that 62% of the US shoppers now shop way more than they did during Pre-COVID, Canada a rough estimate of 59%, Mexico 70%, United Kingdom 58%, France 41%, Germany and other countries around 49%. 

Affiliate marketers are the first one to go when it comes to crisis situations as internet usage is about 50-70% although people might not buy, at least they are engaging and as long as they are engaging you have the opportunity to change their minds into getting something. 

Online sales jumped 15.1%- and third-party sellers working for Amazon grew their sales by 60% on Black Friday. Amazon surpassed $4.8 billion in worldwide sales from Black Friday through Cyber Monday.

When it came to things like fastest growing categories and fastest declining categories, we have a list made:

TOP 10 FASTEST GROWING CATEGORIES

• Disposable gloves.
• Sanitizers and hygiene.
• Cough and cold.
• Soups.
• Rice and Dried grains.
• Weight training.
• Packaged foods.
• Fruit cups.
• Milk and cream.
• Dishwashing supplies.

TOP 10 FASTEST DECLINING CATEGORIES

• Luggage and suitcases.
• Briefcase.
• Cameras.
• Men’s swimwear.
• Bridal Clothing.
• Men’s formal wear.
• Women’s swimwear.
• Rash guards.
• Boy athletic shoes.
• Gym bags.

Markets really had to really look into how they would manage to continue their businesses as there was no saving from the virus. Everything needed to be planned otherwise it could go horribly wrong for the company. (This was for all companies except for companies that produce essential goods such as food, hygiene etc.)

A survey was made which surveyed a network of 30,000 businesses throughout the COVID-19 crisis and the results were rather optimistic as it was seen that an astonishing number of businesses still had optimistic sales forecasts. Almost 28% of these businesses still say that the sales have been growing. Most of these businesses invested in essential items.

During the corona virus period, searches to Buy Online had reached a rough total of 27000+ searches per month. At the start of the year this was about 15000. Just seeing this shows the profit affiliate marketing has made this year apart from some of the downsides that were also seen this year.

Influencers which are somewhat of affiliates themselves had an overall engagement on their posts which exceed 2.9 billion interactions. This also led to some brands spending more on ads this year, others have lowered their spending on ads and some just let it remain the same as previous years.

COVID-19 has definitely raised the standards of online shopping in the views of the people and also raised the sales of such companies. Active affiliates and networks and brands started to work together and claim the benefits in order to survive in such harsh times. In conclusion COVID-19 has had both good and bad impacts to affiliate marketing.

Ecommerce Affiliate Networks like Indoleads.com have also experienced growth in the year as the increase in ecommerce spending has increased with more people ordering from their homes

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