When Amazon announced in 2014 that it will acquire gaming focused video service Twitch, it left many bewildered as to why Amazon would acquire a gaming focused video service in an all cash acquisition. Even to this date, there are many theories going around as to why Amazon acquired Twitch. But one thing certain from Amazon’s effort is that this was meant to give a push to the sales of its retail unit.
At the PAX West Video Conference, Twitch announced that it will allow a program that will allow users to feature products of Amazon and get entitled for a commission from any sales that comes through affiliate links. Amazon confirmed that users can get up to 10% commission from sales that come through their affiliate links.
With over 100 million monthly visitors and a forecast to reach almost half of all US millennial males, Twitch is bullish about its future. Out of the 10 million active daily users, 2 million users are content creators and broadcast their own streams. Twitch users are crunching close to 20 hours of content every week. The community is highly engaged and has lot influencers and Amazon wants to make use of this and ramp up its retail sales through the affiliate program.
The Amazon program will be open to thousands of content creators who are creating content and streaming it on Twitch. It’s a sort of reward program for content creators. Amazon is betting big on influencer marketing. The affiliate program is very lucrative for content creators and will add up to revenue far more quickly than ad revenue.
Twitch allows creators to curate their favorite products and this also offers a better browsing experience. This is great for influencers with a large following and ones who have high frequency of posts.
It’s not sure if Amazon will benefit from such a move but this is certainly a big step towards performance marketing and will play a very important role in influencer marketing. The reasons are:
- To calculate the ROI from influencer marketing is a big challenge
- Top influencers’ fees have gone up and in some cases there is no justification for such high fees
- Platforms like Facebook can possibly tax influencer marketing which will result in increase of costs
Hence compensating influencers from the sales achieved through their influence can address many problems faced in influencer marketing.
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