The Growth of Affiliate Marketing [2024 Update]

The growth of affiliate marketing has helped creators, publishers, and businesses to earn more. Surprisingly, this form of marketing is only a couple of decades old. But, it’s already established itself as a powerful marketing tool.

How did the growth of affiliate marketing happen so quickly and become a virtually instant success? To understand this, we have to look back at where it originated and the influential and helpful developments it’s seen along the way. We’ll also explain how it’s continuing to adapt to stay relevant and useful.

Origins of Affiliate Marketing

The nature of affiliate marketing is much like referral marketing. In both cases, a person makes a recommendation to another about a business’s products or services and then receives a commission for bringing new customers or clients to the business. It’s something that has been around for centuries and has been more actively rewarded in recent years.

Affiliate marketing takes this referral idea but has modernized it for the online sphere. This modernization includes using a personal code or link for an affiliate (an affiliate could be anyone from a blogger or YouTuber to a news publishing website) to earn a commission. 

Affiliates will share their link with their audience so they can check out the affiliated business or purchase a specific product or service from them.

The commission can come from a specific action relating to the business. It is usually earned when an affiliate link brings a sale. However, depending on the business offering the affiliate program, an affiliate may earn a commission for having someone sign up to learn more about the company or a similar action.

The Advent of Cookies

Internet cookies, also called digital cookies, browser cookies, or just cookies, were invented in 1994 by Lou Montulli. They were a huge component in influencing the growth and effectiveness of online marketing as well as in shaping our online experiences.

Cookies are a piece of code or text that shares information about you with the website host you visit. For example, a cookie can keep you logged into a particular site or remember your login details. 

Cookies do many things to make your online experience enjoyable and personal. They do so by providing content or ads relevant to you and your interests or keeping your cart up to date while shopping through different product pages.

The addition of cookies to online browsing allowed for tracking of affiliate link use. It made it easy to connect an affiliate’s unique link with a specific action like a purchase or email sign-up. 

In the case of an affiliate link, a cookie lets the website host know who sent a new customer to their site. This way, they can be credited for any sales.

The Early Days of Online Shopping & Affiliate Marketing

In the early 1990s, when online shopping started to rise in popularity, affiliate marketing gradually began to form alongside it. The marketing tactic was developed by PC Flowers and Gifts owner William J. Tobin. But, it was made popular by early-day Amazon’s online bookstore in 1996 (long before it became the retail behemoth as we know it today). 

Amazon offered its Amazon Associates platform, which paid people who shared a personalized link to the Amazon store through their website a small commission for every sale made using the link.

The First Affiliate Networks

As affiliate marketing became more widely available, ways to easily connect businesses with affiliates started to be developed, leading to affiliate networks. 

Affiliate networks provide a platform where potential affiliates and companies can connect with one another. They can also track their links and commissions (though the full function of each network will vary from network to network).

One of the first of these affiliate networks to enter the scene was LinkShare (today known as Rakuten LinkShare) in 1996.

Social Media & Affiliate Marketing

In the early 2000s, social media debuted, with MySpace and Facebook leading the way. Though new to the world, these platforms showed social media’s potential for affiliate marketing. 

Social media platforms meant that affiliates didn’t need a website or blog to share their links with their audience. They could use social media instead.

The concept of affiliate marketing for influencers caught on. Today, many influencers use the platforms to share affiliate links or codes with their audiences.

Affiliate Marketing Today

In 2024, the affiliate marketing model is highly valuable, with a worth exceeding $17 billion. It’s responsible for 16% of online purchases. It’s used by small and large businesses for a wide range of products and services, ranging from European apparel companies to Canadian slot sites with over 4000 games.

It’s become a trendy marketing style in everything from personal finance, wellness, and travel to beauty and pet products. Social media platforms, blogs, and websites are some of the top places where links are shared. However, we can also find them in other corners of the internet, like our inboxes. 

It has developed to have three different types of marketing: unattached affiliate marketing, related affiliate marketing, and involved affiliate marketing. These indicate the various levels of connection or use an affiliate may have with the product or service they’re sharing a link to.

The success this marketing has seen, for both affiliates and businesses, is only expected to continue being a strong revenue driver. It’s estimated to grow to almost $27 billion by the end of the decade.

The development of tools like AI is helping to enhance affiliate marketing efforts with AI-powered campaigns and performance analysis, while the use of existing tools, like cookies, is ever-changing and shifting. These changes mean that the affiliate marketing world constantly shifts and evolves to keep up with the market.

Final Words

In just under 30 years, the growth of affiliate marketing made it become a marketing powerhouse. It allows creators, publishers, and businesses to enjoy a win through a new sale or commission.

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