By Chris Lee

The practice of affiliate marketing has gained traction in recent years as Web publishers look for new revenue streams from their content beyond banner ads, and brands look for more subtle ways to reach consumers. Some estimates put the value of the UK affiliate marketing arena at £4 billion in 2009.

UK-based affiliate market platform Skimlinks recently demonstrated the growing confidence in this field by announcing it had received a new round of investment to the tune of $1.5 million. The company’s CEO and co-founder is Alicia Navarro, and NMK’s Chris Lee caught up with her to find out why affiliate marketing is so popular.

Skimming the Surface

Skimlinks emerged from a previous business-to-consumer online shopping portal, when the company realised it had retailer links which it could automatically convert into affiliate links. Originally an internal programme, it is now a widely available platform which supports 7,000 merchants globally.

“[Skimlinks] is a little bit of code which an online publisher adds to their site that will find any retailer links on that site whether they’re by editors or other users, and when the user clicks on those links at that time it will check whether they can be turned into an affiliate link,” Navarro explained. “There’s no difference from the user experience but the publisher is able to earn money without having to do the hard work of building and maintaining those affiliate links.”

Why Affiliate Marketing?

Navarro believes that advertisers have become disillusioned with banner advertising and text ads as it is difficult to measure return on investment over those mediums, whereas affiliate schemes help them control costs and target audiences that much better.

“It’s a step closer to what [marketers] need,” Navarro said. “You can link your marketing spend completely to the revenue you make from a sale. They know exactly what they’re going to spend on every customer. For publishers it’s a nice additional revenue stream without taking up too much screen real estate.”

Affiliate marketing is linked to editorial content, Navarro argues, which brings benefits for search engine optimisation (SEO) reasons as well as a providing long-term, on-going visibility.

Best Practice

Despite the apparent benefits for publishers and marketers, what impact will affiliate marketing have on the integrity of content if it’s geared towards creating a sale? Is editorial discretion threatened?

“We’re very adamant on publishers retaining their editorial integrity. Very quickly users will pick up if something has an editorial bias,” Navarro told NMK. “You should write as fair and objective a review as possible because in the long run your readers will trust you more and return more.”

Other best practice tips include linking directly to the product in question, not simply the store homepage, as that will increase the chances of making a sale, she concluded.

To hear the complete podcast with Alicia Navarro, CEO of Skimlinks, please visit the author’s blog.