Let me preface this post by saying that I'm probably not qualified to even write it. I'm not an industry expert, nor a "thought leader", and yet there's been a thought turning it over in my head for a while and I thought I'd write it out and try to make sense of it.

Every year, figures come out showing us that loads more people are online and using the web for their shopping. I imagine there can only be a few years of this frenetic growth before the figures plateau and the numbers of new online purchases decreases, and buying online becomes even more widespread, accepted and normal than it already is now.

So as e-commerce matures, I'd expect shoppers to become increasingly net savvy and demanding. Obviously lots of people already use price comparison sites, especially for financial products, but in the future, will shoppers buy anything without first wanting to undertake a price comparison? Will price comparison become a standard part of buying online? The web has the power to ensure customers always get the best price and I think that will be essential.

Now, running a large scale price comparison operation is surely a difficult job. Books have unique identifiers (ISBN etc) which mean you can easily price check various merchants, but in other retail sectors, I don't think anything like that exists and product titles can sometimes vary slightly which means there's a fair amount of work, maybe with manual data input, involved in properly comparing products. Also, for a large scale price comparison site, that's potentially a huge amount of data which needs to be stored and accessed efficiently. This requires significant resources.

It occurs to me that running a price comparison operation of the type required by shoppers in the future will be beyond small time affiliates.

Presently, there are merchants, and affiliates, and the affiliate networks are the glue in the middle which help make it all happen. They meet the requirement as it now between publishers and vendors. But in the future, when shoppers demand price comparison and affiliates need to be able to offer it, it seems to me that a different service will be required from the "glue in the middle" in order to justify their role.

If affiliates all need to be able to offer price comparison, then they might as well all sign up as affiliates of price comparison sites, and they could effectively take on the role of the affiliate network. So basically I think there will be a time when affiliate networks need to offer what is now being offers by large price comparison outfits, or large price comparison outfits will become the new affiliate networks.

A similar argument can be made for cash back sites. They are another "killer app" for consumers which eventually might become an essential part of the online shopping experience. Small time affiliates would find it hard to compete with the logistics of a large cash back operations so it might be a case of "if you can't beat 'em, join 'em".

In the future, becoming an affiliate of a large cashback site with full price comparison tools would probably satisfy the requirements of many small affiliates. This would allow small time affiliates to concentrate on what they can do best - creating useful new web content - and let the middle man - connecting publisher with merchant - to take care of creating and maintaining the tools which affiliates (and their users) demand.

Labels: affiliate marketing