In 2008, online marketers have spent $2.1 billion on affiliate marketing fees, with US online affiliate marketing spending reaching $3.3 billion in 2012, as indicated in a new report US Online Affiliate Marketing Forecast, 2007-2012, published by JupiterResearch.

According to the report, affiliate marketing remains a highly attractive endeavor because it is performance based, presenting low risk and requiring low initial investment. Over time, marketers tend to work with affiliates that drive the most traffic to their sites, resulting in a small number of affiliates driving the majority of traffic and sales.

Because affiliate marketing is so heavily intertwined with the search engine marketing industry, Google is the one wild card that might affect the overall growth of the industry. Google’s dominance over SEM forces affiliates to be sensitive to Google’s Quality Score, which prevents lower-quality affiliates from buying paid search.

“Strong affiliates that have quality content and responsible marketing practices succeed within the changing search environment and reap the benefits of a growing ad arena,” explained Patti Freeman Evans, Online Retail Analyst and lead author of the report for JupiterResearch.

According to David Schatsky, President of JupiterResearch, “To date, an alternate way to generate traffic from search has not materialized. However, the development of niche outlets such as blogs and social networking sites does provide balance to the consolidation of top affiliates.”

JupiterResearch provides unbiased research, analysis and advice, backed by proprietary data, to help companies profit from the impact of the Internet and emerging consumer technologies on their business. www.jupiterresearch.com.

Copyright 2007 by My Personal CMO .com. All Rights Reserved.

US online retail sales this holiday season will reach $44 billion, a 12 percent increase over last year and the slowest growth rate to date, according to Forrester Research, Inc. (Nasdaq: FORR). This year’s weakened growth is indicative of the difficult economic environment catching up with formerly resilient Web buyers.

Although US consumers are pessimistic about the health of the economy, they expressed a marked interest in the ability of the Web to save them money. Forty-eight percent of consumers surveyed, compared with 41 percent in 2007, said that they can find the best values and deals online. Additionally, 36 percent of consumers said that they would be more likely to shop online due to high gas prices, compared with 22 percent who expressed the same sentiment last year. Forrester expects that the majority of holiday online sales will be driven by shoppers who have previously purchased online, rather than first time online buyers.

“While eCommerce has traditionally been resistant to negative offline trends, growing concerns about the stability of the economy are finally affecting consumers’ online shopping decisions,” said Forrester Research Principal Analyst Sucharita Mulpuru. “This is going to be a very competitive online shopping season, so retailers should take immediate steps to bolster their customer retention strategies in order to ensure repeat purchases.”

More than two-thirds of consumers surveyed said that they are planning to spend more or about the same online as they did last year. Core holiday product categories such as clothing will remain top choices for online buyers, as well as books, DVDs/videos, music, gift certificates, and toys. Respondents also indicated that they will be seeking free shipping offers more often this year than last.

“A main attraction of the online shopping environment is the breadth of information that it offers,” said Patti Freeman Evans, Forrester Research Vice President and Research Director. “Retailers should expand their use of online marketing tactics on search engines and comparison-shopping sites since shoppers are likely to be researching the Web more thoroughly when deciding on this year’s holiday gifts.”

This year’s annual holiday forecast was a collaboration between Forrester Research and JupiterResearch, now a Forrester Research company. Two surveys were conducted to measure the attitudes and expectations of online consumers during the upcoming holiday shopping season, which was defined as the months of November and December. The first survey was fielded in September 2008 and received 2,153 individual responses. The second survey was fielded in early October 2008 and received 1,042 individual responses.

Forrester Research, Inc. is an independent research company that provides pragmatic and forward-thinking advice to global leaders in business and technology. www.forrester.com.

Copyright 2007 by My Personal CMO .com. All Rights Reserved.

A rich data asset for Consumer Market Research professionals’ product planning and go-to-market strategy assessments, the 11th annual Benchmark includes responses to more than 100 questions covering 1,500 elements and more than 450 brands. It is the largest ongoing survey in the world to explore consumer attitudes, ownership, and use of technology.

A generational analysis of the survey results is available in the new report, “The State Of Consumers And Technology: Benchmark 2008.” By examining the unique technology profile of each generation, Consumer Market Research professionals can gain critical insight into future buying and adoption trends for their target demographic and set their product strategies for the next five years.

“Gen Y is the audience that most companies are struggling to understand right now because it’s key to their future revenue growth,” said Charles Golvin, principal analyst at Forrester Research. “One of the questions we’re asked most frequently is the difference between Gen Y and Gen X, and this year’s data clearly shows the distinction. Gen Xers use technology when it supports a lifestyle need, while technology is so deeply embedded into everything Gen Yers do that they are truly the first native online population.”

According to the report, although Gen Y is a small generation of 18- to 28-year-olds, comprising only 38 million US adults, it sets the pace for technology adoption. Nine in 10 Gen Yers own a PC, and 82 percent own a mobile phone. But it’s technology use that sets this generation apart: Gen Y spends more time online — for leisure or work — than watching TV. Seventy-two percent of Gen Y mobile phone owners send or receive text messages, and 42 percent of online Gen Yers watch Internet video at least monthly.

In contrast, Gen X, which is comprised of 29- to 42-year-olds — 63 million US adults — uses technology when it intersects with a personal need or fulfills a desire. For example, 32 percent of Gen X households own an HDTV, and 29 percent have a DVR. In the past three months, 69 percent of online Gen Xers shopped online, and 65 percent banked online, higher percentages than any other generation. Gen X is also ramping up its Internet and mobile activities, including reading blogs (21 percent of online Gen Xers do it at least monthly, up from 15 percent in 2007) and texting (61 percent of Gen X mobile subscribers do it today, up from 49 percent in 2007).

Forrester Research, Inc. is an independent research company that provides pragmatic and forward-thinking advice to global leaders in business and technology.www.forrester.com.

Copyright 2007 by My Personal CMO .com. All Rights Reserved.

Whether we actually enter a recession or not is still up for debate. However, it does bring up a prickly subject for many businesses. Should you continue investing in marketing or defer those expenditures until the economy picks up?

Let Your Brand Do Your Selling

When the stability of the economy is in question, the knee-jerk reaction for many businesses is to pull back on their marketing efforts until a bull market returns. In reality, there isn’t a better time to market than during a recession – whether real or imagined. As John Vanderzee, former advertising manager for the Ford division of the Ford Motor Company, said during the 1990-91 economic slump, “Anybody who retrenches because of the recession has really got his head in the sand.” Vanderzee then added that spending money on marketing during a recession is a must.

An economic downturn can be an opportunity rather than a death sentence. If your product or service is synonymous with value, then you’re already ahead of the curve. With closer attention to spending, customers are carefully evaluating their options and will continue to look for high-quality, affordable products and services.

What’s more, it’s likely that your competition will be less visible, since many companies fail to recognize the opportunity and instead reign in their marketing expenses. As a result, they leave potential market share on the table. Consequently, your continued marketing efforts stand out and are more likely to be heard with less chatter in the marketplace.

A strong brand can pay big dividends during a recession, enhancing the success of your marketing efforts tremendously. If your brand clearly demonstrates value to your audience, is managed well, connects with your target on an emotional level and instills loyalty, you are likely to fair well during any perceived recession. Prudential’s Retirement Red Zone campaign is one example. It taps into the retirement concerns of consumers and reassures the audience that, despite the current economy, they can achieve their retirement goals. The campaign uses television, radio and print ads, to drive consumers to the Prudential website. Once there, they can engage with personal advisors and access various educational tools, resources and information on their website.

If your brand doesn’t meet the criteria above, do not panic. Now is a great time to heighten your visibility (often amid less competition). Take the time to perfect your brand and then reach out to your audience to underscore your brand’s value.

Conversely, you may have a well-known brand but a premium product or service. You may wonder if your audience will continue to “indulge” when times are tight. If you’ve done a good job of defining and strengthening your brand, your core loyalists will continue to buy. Take Tiffany’s, for example.

Regardless of economic downturns, Tiffany’s continues to thrive. People continue to buy, despite the cost because the brand has reinforced its quality and timeless appeal. The robin’s-egg blue packaging is easily recognizable – even without the name people know it’s Tiffany’s. It conveys the brand without saying a word.

See the Tiffany’s envelope or box and you think: Hope. Promise. Something of value and elegance. Tiffany’s products may be premium but they convey quality and elicit strong, positive emotions within its audience.

Click here for part 2 of the article.

Copyright 2007 by My Personal CMO .com. All Rights Reserved.

Last week, Forrester Research fielded an exciting report ‘The Emerging Green Technology Consumer’ which concluded that “Consumer Electronics Companies Should Design And Market Environmentally Responsible Products And Services”.

The Forrester survey (of 5,000 adults) identified 3 distinct segments of US technology consumers: