Many people don't know that behind Amazon's brilliant marketplace is an army of affiliate links from websites all over the world. It is a key pillar in how they drive traffic and sales.
If you don't know what an affiliate link is, it's a link that tracks where the traffic is coming from and rewards the traffic sender with a small percentage of any sales that occur on the other end. For example: If you are reading a blog about cleaning products free of harmful chemicals, the blogger may suggest that you check out a certain product on Amazon they really like. They will then link to that product, the link being an affiliate link, which they have access to by signing up for Amazon's affiliate program. Amazon then rewards the blogger (the person sending the traffic) with a small percentage of the sale, assuming the person buys something on the other end. Think of it like a finder's fee.
Now, that's not to say that every single person is an Amazon affiliate. There are a lot of people who link to Amazon products just because they want to point people to a helpful resource. But there are also others who make their entire living off driving traffic to Amazon and making money as an affiliate. It's a powerful system, to say the least.
But according to TechCrunch, Amazon is quietly beta testing a much more targeted and finely tuned version of their affiliate program, designed specifically for influencers.
What does this mean?
Well, right now the biggest issue powerful influencers face is figuring out how to monetize their influence. Some settle for doing promoted posts for brands or companies, taking photos of themselves holding a branded shaker bottle or doing an "unboxing" video on YouTube. Others become entrepreneurs our of necessity and start their own clothing lines or develop products that they can sell to their target audience. But that sort of thing is few and far between--and definitely not the majority.
So what about all the other influencers out there, who have built sizable and highly targeted audiences for themselves?
That's the problem Amazon is looking to solve. It also has the potential to be extremely lucrative for both parties: the influencer, and Amazon's marketplace.
The reason influencers are going to want to get on board is because they can essentially set up their own store on Amazon. They can pull together products that make sense for their target audience. Using their "influencer affiliate" link, all they have to worry about then is driving traffic. They don't have to go through all the pains that another influencer would go through trying to launch their own store on their own website with their own products.
Now, an influencer who is successful at doing things their own way has the potential for a bigger upside, but they also face many more risks. But an influencer pointing to Amazon can mitigate those risks by sacrificing a bigger upside for a more modest percentage of sales.
What's interesting though is why Amazon wants to enter this space. In many ways, it is the next logical step after seeing the success of their affiliate network. But the fact that they've pinpointed an issue and an opportunity with influencers only confirms much larger speculations: people buy from people they trust. And today, influencers are the ones driving purchasing decisions.
The program is still in its beta phase, but it will be interesting to watch how this unfolds--and how the influencer marketing space changes as a result.