Affiliate marketing has been around for a considerable time now and its impact shows no signs of abating. The main reason for its enduring appeal is the sheer simplicity of this business model, coupled with the fact it is mutually beneficial to the two parties involved. A retailer will offer affiliate programs to marketers to sell on their behalf in exchange for generous commission rates, while the retailer gains access to products to promote minus the headache of stock control or inventory management.
Across the globe, blockchain technology is being used ever more extensively to streamline e-commerce transactions. It is inevitable this will have an impact on affiliate marketing, particularly when the products in question are affected by international trade. So how will blockchain systems alter the way affiliate marketing is conducted?
Firstly, it would be worth underscoring how blockchain technology actually interacts in electronic transactions. It is deployed across a range of applications, particularly in terms of keeping track of ownership. In a climate where software can be reverse-engineered and the hefty cost of patenting means many innovations are rushed onto the market while their true origin is under debate, blockchain technology is used to establish ownership.
This concept was initially popularized by the digital currency scheme, bitcoin. Blockchain has arisen from this and evolved into an ever-specialized database. Far more powerful than the average databases employed by most corporate bodies, it can be used for multiple functions.
How this chimes with affiliate marketing
Affiliate marketing has been a fairly ‘closed shop’ in terms of reacting to other influences, purely because of how successful it has proved to be in its own right. The growth of online retailing has led to an exponential rise in the amount of affiliate marketing programs being offered by retail organizations. But it has been inevitable that the forces of affiliate marketing and blockchain technology will overlap at some point.
The global marketplace operated by both is never static. Just as e-commerce experts and commentators will cast their eye on how well certain affiliate programs are faring across international boundaries, they will study the fluctuations in worldwide currency performance. Serious affiliate marketers, especially those who are managing multiple income streams focusing on different markets, will keep a close eye on these same trends.
The beauty of bitcoins is the way they can be exchanged for a variety of diverse currencies or products, making them an enticing commodity for international trade. In fact, it has been estimated the number of merchants trading in virtual currency is somewhere in the region of 3-5 million.
How will affiliate marketing change?
The nature of affiliate marketing is the small traders who promote products and services on behalf of retailers are always seeking ways to improve the service they provide to their customer base. What better way to make a site like this more enticing to potential customers than making their pricing scheme more competitive?
Blockchain technology could well bring down the price of transactions. One huge inhibitor with actual currency in international e-commerce is the cost involved in converting from one nation’s denomination of choice to another’s. Virtual currency has the potent ability to circumvent these exchange rates, allowing business to be conducted much more seamlessly.
One area of blockchain technology which is being embraced by more and more affiliate marketers is its potency in digital marketing, primarily in fraud detection. Virtual systems will allow the tracking of the sources of clicks. As well as deterring illegal transacting, this will assist affiliate marketers in assessing aspects of their customer base, allowing them to tell the difference between automatic traffic and genuinely engaged site visitors.