Affiliate marketing ≠ word of mouth
The future of affiliate marketing will be on the blockchain
Affiliate marketing is the practice or strategy where an individual partners with a business in order to make a commission by referring readers or visitors to a business’s particular product or service.
A micro influencer on Instagram or YouTube mentioning or wearing a product could be such an example, however, that’s not how word of mouth marketing works. In 2019, affiliate marketing involves creating links that at first appears like the logical solution to underperforming ads / banner blindness / brand fatigue, but in a world of authentic word-of-mouth on the blockchain, affiliate marketing may be more of the past than the future.
What is affiliate marketing?
- It’s a way of generating third-party endorsements through influencers and even customers
- It’s a strategy where an individual partners with a business in order to make a commission by way of referrals
- In affiliate marketing you promote other people’s products, often through an affiliate network, earning a commission
Affiliate marketing fails in building and maintaining trust
As popular as affiliate marketing is as a first channel for influencers or bloggers, it doesn’t exactly feel authentic and can actually diminish trust with your direct audience.
While sponsored content is at an all-time high on Instagram & YouTube, as influencer marketing moves to the blockchain, how personal brands augment trust in how they relate to their target audience and customers will also change.
- Blockchain will replace how consumers perceive trust of a personal brand
- Affiliate marketing fails compared to pure-play word-of-mouth since it’s sponsored and not organic, authentic and based on honest referrals or product recommendations
- As influencer marketing scales to the blockchain internet, it’s highly possible old-school affiliate marketing will sync less with consumer values and the Gen Z cohort in particular
Affiliate marketing ≠ word of mouth
The difference between affiliate and word of mouth is also in how the audience interacts with the content. True word of mouth is an honest peer-to-peer mechanism that’s spontaneous and is now often occurring in micro video apps, such as for lifestyle products on the YEAY app and many others.
Affiliate marketing tends to resort to clickbait tactics of link-clicking that was more prevalent before video traffic took over the internet.
Now with video-centric apps trending and stories taking over news feeds, the entire practice of ads and affiliate marketing mechanisms needs to evolve with blockchain, true word of mouth and ecosystems that are more trustworthy.
This is the rationale behind the WOM Protocol, an ad-free ecosystem for apps, consumers and creators.
Brands too are starting to realize the difference between affiliate marketing and sponsored content vs. more organic peer-to-peer word of mouth and how they can impact brand trust.
Affiliate marketing is a poor substitute for word of mouth traffic, because it’s forced, inauthentic and too tethered to ad-based practices that annoy consumers, like interruptions, pop-ups, clicking things and orchestrated product placement in visual storytelling.
Affiliate works by first getting the brands involved to let people pick products to promote out of existing catalogs — it’s a monetization model that doesn’t require the recommendations to be genuine or motivated by anything other than the reward for sharing the link. This is problematic for Gen Z consumers, since they are more trust-sensitive.
Gen Z are starting to view affiliate marketing as a form of misinformation on the internet because it’s not based on honesty, it’s not true.
Authentic word of mouth promotes a new kind of ecosystem
The key value proposition of word-of-mouth content is that they are actually honest recommendations.
Honest recommendations that for brands, creators and audiences have greater value and create a win-win scenario because they are true. They are not leveraging followers for clicks in a numbers game, they are not gaming an audience for profit.
Word of mouth based on honest recommendations therefore, holds values that have a home and apex in trust. Brand trust that chimera of reputation which supports brand-building and purchase considerations that lead to sales — long tail and a more genuine connection with their target audience.
Affiliate marketing has the unfortunate consequence of feeling like an artificial scheme. When influencers and creators are simply motivated to share an affiliate link to get a cut, then it makes the creator/recommender or source too “salesy” and immediately creates a hurdle in the trust-building process. This in a nutshell is the main difference between word-of-mouth content and affiliate marketing content, and in an era of blockchain’s adoption and influencer marketing’s rise, it’s important we can tell the difference.
Building a better internet
Apps, trust, attention, consumer interactions, and product recommendations as a whole will change as the internet continues to grow up and mature.
We believe there’s ample need for an ecosystem built on honest recommendations, blockchain and word of mouth as opposed to more scammy and aggressive ad-mechanisms that are closer to monetization pyramids and attention-manipulation than pure play peer-to-peer referral ecosystems.
Building a better internet requires a more trustworthy ecosystem, where it’s not just about sponsored content, how many followers you have or which affiliate marketing strategy to pick. Instead, it’s about how do you monetize authenticity and genuine recommendations. The WOM Protocol is the solution to this problem and this need for a better internet built on trust, rather than ad-spam.
So how could this work better?
In short, freedom: a better ecosystem with honest incentives on the blockchain.
An ecosystem built on honesty would be like the next-gen of affiliate marketing where young creators could thrive together instead of learn to coerce an exploitative market. Such an ecosystem requires its own unique call-to-action and technology that supports the shift to a better internet.
- Give people the freedom to recommend the products they actually feel compelled to recommend — not products selected from a catalogue
- Create a mechanism that rewards their recommendations — providing they have successfully passed a quality check from validators who believe the recommendation is trustworthy
- Reward the validators (curators) for their effort too
- Invite brands to place affiliate links behind existing recommendations — but only with the consent of the recommender — and ensuring the recommender is rewarded fairly for this
Lastly we know that Gen Z have grown adept at filtering out irrelevant ads, either skimming over or actively using ad-blocking tools. Affiliate marketing as we once knew it probably doesn’t have a great future, but while it’s still not clear what’s next, word of mouth on the blockchain is definitely a promising solution.
The future of marketing is always influenced by how young people consume content, products and interact with brands and this has become much more sophisticated in recent years. A growing number of influencers too are starting to have higher standards of how to interact with their native and organic audiences.
If the micro influencers of today have a personal brand built on authenticity, it’s important find ecosystems that cater to their values and the same goes for app partners and brands. Cryptoeconomic incentives that foster honest word-of-mouth recommendations could go a long way to upgrading how referral traffic works on the future web.
