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Growth of E-Commerce in Malaysia and How Does Affiliate Marketing Help

by Eric

In recent years, digital marketing has been a trending topic in Malaysia. The growth of e-commerce in Malaysia is one of the biggest drivers for this trend. The fact that e-commerce makes up a significant portion of the country’s GDP is a strong indicator of millions of online shoppers taking advantage of most selling items in Malaysia and discounts available online.

The popularity can be associated with several factors, one being the rise in internet penetration from 75 percent in 2014 to 88 percent in 2018 across the country. Notably, young Malaysians aged 18-24 dominate the digital landscape, with 84 percent having visited online shopping sites.

Affiliate Marketing and E-commerce – A Match Made in Heaven:

According to statistics, e-commerce revenue in Malaysia is projected to reach a total of $4,179 million in 2020 and is forecast to grow at an annual growth rate of 17.8 percent (CAGR 2020-2024). There is no doubt that e-commerce and affiliate marketing go hand in hand, especially in marketplaces like Malaysia.

Online marketplaces also help keep track of stock levels, ensuring enough supplies for purchases, especially of most selling items in Malaysia, as they are able to draw a generalized analysis of the prevailing market trend. Affiliate marketers help bring in traffic to marketplaces, while the latter helps affiliate marketers monetize this traffic. Marketplaces allow people to discover products, and affiliate marketers make it easy for consumers to click on referral links and purchase.

Here are four main types of marketplaces in Malaysia.

E-commerce Platforms:

E-commerce platforms are websites where people can both buy and sell products quickly. Popular ones are 11street, Mudah. my, Carigold, and TheGemHorse. Marketplace commissions are calculated based on the commission rate set by the merchant, with e-commerce platforms taking a small cut before passing it to affiliate marketers.

E-commerce Stores:

E-commerce stores are websites that sell products under one brand. It is sometimes referred to as a “one-stop-shop” where buyers can purchase goods from different categories all in one place. Merchants are charged a monthly subscription fee to list products on the platform, while affiliate marketers are rewarded with a commission of up to five percent for every sale made. Read more about How is PPC Beneficial For Ecommerce Businesses?

SNS Media Sites:

Social media sites are widely used these days as they allow people to connect and share information through groups or their profiles. These websites do not charge merchants any fees, but affiliate marketers only get paid when sales are made. Popular social media sites include Facebook and Instagram.

E-commerce Search Sites:

E-commerce search sites are the ones that generate online revenue for Google. They work by allowing consumers to search for products they need on these websites while clicking on an ad or text link to visit an online store. Companies pay Google a certain amount of money if their ads are clicked on, but affiliate marketers get paid from the commission from every successful sale made.

Growth in Affiliate Marketing in Malaysia:

Online marketplaces allow merchants to expand their reach and increase sales exponentially, while affiliate marketers earn more for every referral made. Affiliate marketing helps e-commerce businesses grow, especially when it comes to online marketplaces.

Merchants are given more exposure on these websites since affiliate marketers help bring in traffic by sharing links to consumers. At the same time, they can even expand their brand reach by being listed across different accounts belonging to the same marketplaces.

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