The right way to think about in-app affiliate marketing

Editor's Corner
Shane Schick

When you're deeply immersed in a mobile game or app, what would you rather see, an ad that pops up and blocks your view of the app's main interface, or some URLs that run somewhere on the periphery? Perhaps more importantly, if you're a developer, which would you rather your users see?

The gut-instinct answer to both questions might be "neither," but for anyone who's serious about generating revenue from an app, the choice between mobile ads versus mobile affiliate marketing could become very important. Though affiliate marketing has existed across other channels for a long time, it's still an area that's relatively new to apps, where developers or publishers get paid for inserting links that drive consumers to various Web sites and services. There are already a number of companies offering app-specific mobile affiliate marketing services, such as MobyAffiliates, Bellboon and others. About two weeks ago the CEO of another such firm, VigLink, wrote a guest post on VentureBeat encouraging developers to think about affiliate marketing as one of three possible business models (freemium and in-app purchases being the other two). Oliver Roup, who also co-founded Viglink, suggested that the future may lie not merely with broad-based affiliate marketing programs but with those that create de-facto partnerships among developers:

Another form of affiliate marketing for apps is to promote other mobile apps with the goal of earning commissions when the app is purchased and downloaded. These types of ads typically have a more integrated and natural feel within the app, especially if the content or style (for example a skiing game referring a mountain weather application) of both applications are natural complements."

This reminded me of an old adage I heard once from someone who specialized in this kind of thing: If the content is valuable to me, I don't think of it as "marketing." As developers simultaneously attempt to grow their installed base and monetize their offerings, this may be the best approach to ensuring that an app or game's audience isn't turned off by their business model.

Of course, as numerous people have pointed out, affiliate marketing within mobile apps is not without its challenges. In the desktop Web world, affiliate marketing was largely enabled through the use of cookies. This isn't always an option in mobile browsers that don't support them. At one point there was a hope that unique device identifiers (UDIDs) would be a way for developers and ad networks to get around the difficulties of sharing information between apps, even if a user consents to its use. However, Apple's decision to effectively ban UDIDs means tracking will have to take another tack. In theory, the firm handling the affiliate marketing program could offer developers an SDK to be added to their app that handles tracking, but deciding the parameters of what's measured, as I wrote about recently, is an ongoing debate, even within the more traditional mobile ad space.

Expect to hear a lot more about the in-app affiliate marketing opportunity over the next six months and beyond. It may just end up being one option among many, but if it becomes largely about developers promoting each other, I'm all for it. So much time is spent talking about the overwhelming competition in the app space, and affiliate marketing might be a way to start talking more about "coopetition" instead.--Shane