Performance Marketing in US Retail - eMarketer
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Performance Marketing in US Retail

eMarketer Report

By: eMarketer

Published: November 17, 2016

Jump to: Executive Summary | Table of Contents | List of Charts

Executive Summary

Performance marketing uses clearly defined and measurable business objectives as the basis of payment or optimization. This includes cost-per-action (CPA) models, such as affiliate marketing, and programmatic ads that optimize based on real-time performance metrics.

  • Affiliate marketing accounts for 7.5% of total digital spend among retailers. Pay-for-performance marketing in general, which includes search, classifieds, app install ads and email, accounts for nearly half of digital retail ad spend.
  • Affiliate marketing is growing for several reasons: It’s highly measurable, it can scale easily, and more premium and social content publishers are opening up their inventory to it.
  • Better attribution techniques have also enabled the rise of programmatic marketing, much of it billed on CPM impressions but optimized for CPA or other performance metrics.
  • Performance marketing in general has grown in the retail marketplace because retailers are under fierce pressure for efficiency due to Amazon.com and their falling foot traffic.
  • A better understanding of the consumer journey has enabled a more nuanced use of multichannel marketing with appropriate attribution.
  • Online-to-offline (O2O) goals have proliferated. Facebook and Google have led with new O2O ad products and measurement tools, but they are far from alone.
  • Lifetime value is giving media buyers a better understanding of the long-term value of new customers acquired with performance marketing.

"Affiliate marketing will account for nearly $5 billion in digital ad spend in 2016, according to Rakuten, a figure that is growing more than 10% per year."

Table of Contents

Performance Marketing Defined

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Performance Marketing’s Role in Retail

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Better Understanding of the Consumer Journey Increases Value of Performance Ads

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Factors that Will Help to Drive Pay-for-Performance Growth

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9 charts are included in the full report:

Performance Marketing in US Retail

US Affiliate Marketing Spending, 2015-2020 (billions)

Performance Marketing’s Role in Retail

US Affiliate Marketing Spending, 2015-2020 (billions)

US Affiliate Marketing Spending Share, by Industry, 2016 (billions and % of total)

Share of US Ecommerce Orders Attributed to Select Ad Formats, 2015 (% of total)

US Digital Ad Spending, by Format, 2015-2020 (billions)

US Mobile App Install Ad Spending, 2014-2016 (billions, % change and % of total mobile ad spending)

Performance Beyond Pure Pay-for-Performance Marketing

US Programmatic Digital Display Ad Spending, by Transaction Method, 2014-2018 (billions, % change and % of total programmatic digital display ad spending)

Better Understanding of the Consumer Journey Increases Value of Performance Ads

US Companies Using Multichannel Attribution Models, 2014-2018

O2O Goals Move to Center of Performance Marketing

Digital-* vs. Mobile-Influenced** US In-Store Retail Sales, 2013-2016 (trillions, % of total in-store sales and % change)

Targeting People, Not Channels

Importance of People-Based Marketing According to US B2C Marketers, Sep 2016 (% of respondents)