How Affiliate Marketing Changed Digital Marketing in 1999
A look back at what shifted in affiliate marketing over 1999: the networks that launched, the merchants that joined and what it meant for businesses watching.
Looking back at the year so far, 1999 is the year affiliate marketing stopped being a novelty a handful of retailers experimented with and became something most online businesses at least considered. A few specific shifts explain why.
The networks matured fast
At the start of the year, running an affiliate program mostly meant either joining Amazon’s or building your own tracking from scratch, an option realistically limited to companies with in-house engineering to spare. By mid-1999, Commission Junction and LinkShare have both scaled up considerably, giving small and mid-sized merchants a way to launch a program without writing a line of tracking code themselves. That single change opened affiliate marketing to a much larger set of businesses than could have accessed it in 1997 or 1998.
Commission rates got competitive
As more merchants joined the same networks, affiliates gained something they didn’t have before: the ability to compare offers side by side and choose where to put their limited site space. That competition pushed commission rates up across categories through the year, particularly for digital goods and subscription services, where merchants had more margin to work with and felt the pressure to stand out.
Affiliates got more selective
Early in the affiliate model’s history, most affiliates would run banners for almost any program that accepted them, since there weren’t many options to choose from. By this year, the affiliates earning real money have shifted toward running fewer programs, chosen more carefully, with actual content built around them rather than banner placements alone. Sites that write genuine reviews and comparisons are consistently outperforming sites that just stack ad banners, and other affiliates have noticed and adjusted.
What this means if you haven’t set up a program yet
The window to be first is closing in most categories, several retailers in books, software and consumer electronics already have established programs with loyal affiliates. That doesn’t mean it’s too late, general retail and most services remain wide open, but it does mean the “just set up a program and affiliates will show up” approach that worked in 1997 requires more effort now: clear terms, competitive commission and some outreach to affiliates who’d be a good fit for your product.
The bigger shift
What changed this year isn’t about affiliate marketing’s mechanics, those are largely settled. It’s that enough merchants now run programs, and enough affiliates now depend on the income, that a genuine ecosystem exists where none did two years ago. That’s a different thing than a clever growth tactic. It’s infrastructure, and infrastructure tends to stick around.
More on Paid Advertising, or browse everything from 1999.
