Getting Rich from
Affiliate Programs
Affiliate programs (also called Referral Programs or
Partnership Programs) are essentially commission-based sales
schemes. You recommend a site to your users and pick up a percentage
of any sales those users generate. You benefit from the commission
and the site benefits from sales it wouldn’t otherwise have made. If
you’ve ever gone to a website and seen links to Amazon, those were
affiliate links.
You can run an affiliate program from a site you’ve already
set up, or create a site specially to promote a product or service.
As long as it brings in more cash than you spend on building it and
buying traffic, you’re laughing.
Affiliate ads work two ways: you can join them to make money,
or you can run one to attract users.
As with any marketing venture, you need to be careful in the
selection of an affiliate program. The benefit of an affiliate
program is that it gives you another way to make money from your
users. Instead of selling them a product yourself, you send them to
a partner and take a cut.
On the downside though, your affiliate ads will take the place
of a different ad that you could have put in that same spot. You
have to make sure that each advertising position on your site is
bringing in the maximum revenue possible. If you’re not getting the
most from your site, you’re tossing money away.
The key to success is to choose the right program, right from
the beginning.
Now, a lot of commercial sites run affiliate programs. That’s
because they know that they only have to pay a commission if a sale
is actually made; it’s a proven way to generate revenue without
risk. What that means for you is that when it comes to choosing an
affiliate program, you’re going to have a huge range to choose from.
What it all boils down to though is product and price.
While it might be tempting to go for the program that pays the
highest commissions, the program won’t pay you a penny if your users
won’t go there or won’t buy once they get there. You have to be
certain that the service you’re promoting is of genuine interest to
the kind of users you buy, whether you’re buying them from search
engines or anywhere else.
Sure, you can work backwards: You find a high-paying affiliate
program and create a small site to send users to it, but do you know
where to buy users for a program like that? You’re going to have to
research the field, check out the most popular sites, and negotiate
banner campaigns and link exchanges.
That’s fine if you want to invest the time and the effort. But
it’s much easier to find an affiliate program operating in a field
you’re familiar with, and use that program to earn extra cash.
For example, suppose you had set up a dating site. You might
make bit of money selling subscriptions, but you might make even
more by joining Match.com’s affiliate program and selling them your
users. Unless you’re planning to be the Internet’s biggest dating
site, you’re not going to be able to compete directly and beat them,
but you can join them—and earn money.
Or rather than sell your users directly to a ‘competitor’, you
can look for services that complement your own. Visitors to your
dating site, for example, might be interested in buying flowers,
books on relationships or tickets on singles cruises. Instead of
selling just one product—membership subscriptions—you’d be selling a
whole range of different goods to the same people, and increasing
the sources of your income.
Here are some tips to selecting an affiliate program that is
lucrative and right for you:
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Don’t accept less than 25% commission. You can find
affiliate programs with great payment structures and high
percentages of the purchase price in just about every field.
-
Look for comprehensive statistics pages that list the
number of click-throughs, sales and earnings so you can see how
you’re doing. The information should be broken down by month.
-
Look for programs that offer a wide variety of promotional
tools to put on your Web page, including text links, banners
and graphics.
-
Find out how often you will be paid and make sure that the
payment schedule meets your expectations. Some programs pay
monthly, others quarterly; which is best for you?
-
Look for examples of marketing methods that successful
affiliates are using to get the best results.
-
Make sure that top level support is given. If they can’t
answer your questions promptly and intelligently, you don’t want
to work with them.
Joining an affiliate program is a neat way to make money from
your users. But just as you can join someone else’s affiliate
program, so you can set up your own program and invite webmasters to
sign up.
What would that bring you? The same as you’re bringing your
affiliate partners: deals. Every time someone sends you a user who
gives you money, you give a portion of that money to your affiliate.
It’s an easy way to generate traffic and earn cash.
And you don’t need to be a programming genius to set up an
affiliate program. There are a whole bunch of companies out there
that offer entire affiliate kits right off the shelf.
Ultimate Affiliate lets you run a fully featured affiliate
program from your website. It integrates with virtually every
payment method, awards down-line commissions, and can handle
high-traffic websites. You can edit the sign-up form to match the
"look and feel” of your site as well as delete some of the optional
fields. The administration area allows you to edit affiliates and
commissions, create printable reports of money due, export the data
to a text file, view the traffic through your affiliate program, and
much more. Your affiliates can log in at any time and see their
traffic and commission statistics as well as change their
information and get links and banner code.
Once the program is set up you'll only need to log in once a month
to print out a list of the affiliates, their addresses, and the
money owed. You can do this quarterly if you wish. You can export
the payments owed to a text file in PayPal's "mass pay" format and
then just upload it to your PayPal account to pay everyone
automatically. Or, you can simply write your own checks. If you have
to pay a lot of commissions, there is a check printing service
called qchex.com. Upload the file and they’ll print and mail your
checks for a fee of about 80 cents each.
Alternatively, Locked Area Pro is an advanced member's area
management system offering very good security that’s easy to
maintain. The system provides a huge list of useful features
including automated sign-up, user account validation, optional
random password generation and an administration approve/decline
account feature. It also comes with an extremely powerful control
panel with an online administration of users, backup, and full
customization facilities from the browser. A statistics system is
also in built in. What more could you want?
Any time you run a program where your affiliates rely on other
signups to generate profits, you will eventually have a problem with
spam. One of your affiliates will inevitably get it into their head
to blitz the Web with unwanted garbage.
When this happens you need to be ready to take
action—otherwise it will cost you! Your Internet company can boot
you off your server and you can find yourself blacklisted. Not good
for business. If you get an email from someone claiming they
received spam with your URL, then take it as an early warning. I am
not advising you to immediately terminate the affiliate’s account,
but be sure to contact them to follow up on the complaint. Let your
affiliate know you received a complaint and advise them to remove
this person from their list.
If you only get one or two complaints, it’s probably not
spam—the complainants might simply have signed up for an email list
and forgotten all about it. You will know when one of your
affiliates is spamming, because you will get anywhere from 10 to 100
complaints in the same day all regarding the same URL. The best
thing to do in this case is to immediately terminate or disable the
account of the affiliate URL that was spammed.
The key to any business is to promote your products and
services to people who need them. Your affiliate business is no
different. In order to earn commissions you must put your products
in front of the people who need them. The beauty of marketing
affiliate programs is that it is anybody’s ball game. This is the
one place you can burrow deep into your own niche and stick it to
the so-called 'big wigs'.
You may create your own affiliate program or you may promote
other popular affiliate programs that are related to your product or
service. The best way to manage and track affiliate programs is by
creating your own affiliate program website. This is where you can
list all your affiliate programs.
Staying Organized
There are many affiliate networks that provide multiple
affiliate programs and merchants. Keeping a track of all affiliate
programs in a single network is easy. You would generally be given
one username and password as well as a single interface that
controls all the programs. However, if you have many of your own
affiliate programs or you promote several stand-alone affiliate
programs from your website, the task of staying organized becomes a
bit more complex.
There are many software programs available on the Internet
that organize and keep track of all data associated with affiliate
programs. Some of these are My Affiliate Program 2000 and Affiliate
Assistant 1.0. These programs maintain databases pertaining to
information about all your affiliate programs. A typical database
would consist of the following fields:
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Program Name
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Date joined or created
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Contact Name
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URL
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Email Address
-
ID
-
Password
-
1st Tier Percent
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1st Tier Sale
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2nd Tier Percent
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2nd Tier Sale
-
Total Income
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Additional comments
Once the program information has been entered, you can add
information about individual sales made and checks received. The
program then keeps track of sales to date, amount collected and
receivables. Besides, some of the advanced software programs also
provide analysis and comparison tools for all affiliate programs. If
you take the time to input collected data about clicks, sales, and
page views, impressions, emails sent etc. from your various
campaigns and enter all of it into the program, it will show you:
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Click to Sale Ratios
-
Impression to Sale Ratios
-
Amount Earned Per Impression
-
Amount Earned Per Click
Apart from these are a few other tips that might help you
manage your affiliate programs.
-
Always ensure that your website is up and running. On a Daily
basis type your URL into your browser's address bar, refresh the
page and find out. The danger in not knowing that your site is
down comes when you are running a pay per click advertising
campaign. The click costs add up whether your site is functional
or not. If your site is down, you are paying for advertising, but
no one is buying.
-
Check your statistics daily, maybe even twice a day. This will
give you a better idea of your income trends and also highlight
affiliate programs that bring your business. Visit the statistics
interface for each network and individual affiliate partner and
input your total revenues into any accounting software. Using such
software frequently will also keep you informed as to whether
certain checks have become overdue.
-
Be prompt in answering any queries from affiliate partners or
customers, especially when these are about your products or
services. This probably means that the customer trusts your site
and is thinking of buying your product.
-
One of the main aspects of any affiliate program is residual
income. You've got to make the most of each and every customer you
receive. The best way to do this is by promoting affiliate
programs that offer residual commission.
-
This allows you to repeatedly get paid for work you do once. For
example, if a visitor arrives at your site and purchases auto
responder services, newsletter subscriptions, ISP/hosting
services, you will collect a portion of the monthly fees for as
long as they remain a paying customer. Membership sites are a good
way to collect residual commissions and are steadily growing in
popularity. There are many affiliate programs that offer residual
commission.
-
A well placed recommendation placed at the end of an outgoing
email can bring in extra sales. Target your audience, what are
their specific needs? If you can offer them a product they
need/want, often times the end result will be a sale.
-
Finally, track all your affiliate links. The best way to
accomplish this is by setting up tracking software for your
affiliate links. There are a number of scripts that will do the
job. Most tracking programs typically allow you to setup tracking
links for any product you promote, telling you how many hits each
product has received, and where the hits are coming from. A more
detailed view of tracking and analysis is given in the section
below.
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It is not enough to have a few banners and classified ads. You
must provide as much help as possible for your associates if you
want them to be successful. You should have tested and proven
endorsements, testimonials, sig files, ezine ads, and other unique
tools and techniques. You must also make yourself available,
either through email or the phone, to help your affiliates
implement these tools and to answer any questions they may have.
-
Whether you run your own or participate in an affiliate program,
you must be able to determine what methods work best in a
particular medium. For instance, which ezine ads work best and in
what ezine; which banner ads produce the greatest clickthroughs
and from which sites or banner exchanges; and where on your
website is the most effective spot to include a testimonial.
-
Some affiliate programs, have implemented unique payment
procedures to get affiliates their commission checks on a timely
basis. Some of these procedures include: online electronic payment
services, direct bank deposits and checks by fax. If you can
solidify your payment procedures from the start, you will save
yourself an administrative headache and more importantly, keep
your affiliates happy and working to promote your program.
Website statistics and affiliate sales figures are essential
for evaluating the effectiveness of your affiliate programs. Before
you start recording and analyzing data, it's worthwhile to know what
statistics you're trying to calculate - and why. Following are some
of the key questions that need to be answered periodically to ensure
the success of affiliate programs.
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What percentage of the website visitors become customers through
affiliate programs?
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What percentages of sales are new or renewals?
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What is the average revenue per visitor?
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What is the average revenue per sale?
The most important figure you need to keep track of is the visitor
to customer conversion. It tells you exactly how well you convince
your visitors to buy your affiliate products. Average conversion
ratios for affiliate programs range between .5 and 1.5 percent.
Anything above 1.5% is really good. This figure, however, indicates
the total conversion for all the affiliate programs. If you promote
more than one affiliate program you need to also calculate the
conversion rate for each of the programs.
Knowing how conversion rates compare between programs is
useful when deciding how to direct your promotional efforts. For
example, if you discover that Program 'A' converts at 1% and Program
'B' converts at 2%, it might be time to spend more time and effort
to promote Program 'A'. Most tracking software would give you
detailed information about each of the affiliate programs promoted
on your website.
All affiliate programs that have a low conversion rate should be
dropped. While this may seem like a lot of work to go through to
track your site's performance, it really is a worthwhile endeavor.
Once your tracking mechanism is set, and you've done the inputs a
few times, you'll be surprised at how simple it becomes. In fact,
you may find that eventually you look forward to 'adding things up'
at the end of the month to get a clear picture of where your
affiliate business stands.
One of the biggest fears new Affiliate managers have is in
finding new affiliates. This fear is a stumbling block that stops
many site owners from getting started with affiliate marketing.
Interestingly, with a proper marketing strategy, getting affiliates
may not be very difficult. Given below are some tips that may help
in attracting new affiliates.
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Find complimentary sites - "Complementary" sites are a sites that
sell products or services that compliment your offerings. If you
sell "gardening tools", a site that sells books on "gardening
tips" would be a perfect affiliate. If you sell software, try
looking for sites that sell computers or computer parts. Finding
sites that already attract your target market, and can benefit
from recommending your product or service to their visitors, is
the goal.
-
Find content sites – There are many sites that do not sell any
kind of product or service but are mainly content-oriented sites.
Such sites promote an idea, concept, study or belief. Content
sites that are used as a resource for your target market are ideal
affiliates.
-
Finally, there are several sites on the Internet dedicated to
listing affiliate Programs. Get your program listed in these
directories.
The hardest part of administrating an Affiliate Program is
deciding what your affiliates need to help make the sale. But, by
carefully categorizing your affiliates, you can easily determine
what their needs are and how to accurately meet them. The plan given
below helps in categorizing affiliates in order to manage your
affiliate program better.
The first step is to pick at least three types of
affiliates. Take a look at your affiliates and try to determine one
outstanding characteristic that can easily be compared across the
board and choose at least three types of the characteristic. Here
are some examples:
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Level of Sales - You may find that your affiliates are so
completely different that it's hard to find something to classify
them by. Try classifying them by the level of sales they've
reached with you. You'll most likely find that you have a few
forerunners that lead the pack with a number of sales, quite a few
affiliates that have sporadically made a sale or two and some that
have yet to make a sale. This will help you classify them based on
sales.
-
Products - If you sell a wide variety of products for specific
interests/needs you may be able to classify your affiliates by
product. For instance, a financial site could classify types like
Personal Finance, Small Business Finance, and Corporate Finance.
-
Industry - If you market commodities like office supplies, health
and beauty products, house-wares and so on, you may find that your
affiliates come from a wide variety of industries. You can most
likely classify your affiliates according to their industry.
The Second Step is to determine the needs of each type.
Each of your affiliate types will have different needs; some of
their needs will overlap, but you should find a distinct difference
in many of their needs. If you find that all of them have the same
needs, go back to step one and re-think your types.
Here are some basic things to look for:
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Linking Methods - Different types of affiliates will need
different linking methods. Let's use the example above where we
had different groups based on sales. Your low sales group may be
satisfied with a banner or two to place on their site. Your medium
sales type may be interested in an article or two for added
content on their site. Your high sales group will probably pass up
banners for articles, guestbooks, email ads and signature files.
-
Capturing visitors is what you
want. In order to do so -- you have to know what they want. Visit
your affiliates' sites to see what visitors are looking at and
looking for. Ask yourself, "How does my product relate to what I
am seeing?"
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Different types of affiliates may expect different commissions.
You'll have some Affiliates that have joined your program "on the
side" and others that plan on earning a substantial income from
the program. Determine what effort they are putting into
advertising, how much other programs in your industry are paying,
and the amount of time they devote to your program.
The Third Step involves the process of creating and
compiling linking methods for each group of affiliates. Based on the
needs you identified in Step two, create and compile linking methods
for each type. Here are a few linking methods to think about.
-
Banners - Though they aren't as effective as other linking
methods, banners are still widely used and expected. Make banners
in a variety of sizes to fit tops of pages, bottoms, toolbars,
sidebars and other miscellaneous areas.
-
Articles - These are great for affiliates that need content for
their websites and newsletters. Be sure that your articles are
articles and not ads.
-
Email Ads - Your active affiliates may be interested in placing
ads in e-zines or their own newsletters. Try writing a few ads in
different lengths.
-
Signature Files - Dedicated affiliates may even add your tag to
their signature line. Give them a few witty lines to choose from.
-
Guestbooks: - Let your affiliates help you build your Opt-In email
lists with guestbooks. Offer them a commission for each email
address they send you, or each resulting sale from the subscribers
they send you.
-
Product Images - Give your affiliates images that show and link
directly to specific products. They'll be able to choose an image
specific to their site, or choose several images to display.
-
Review each affiliate Type and match them up with your new linking
methods. You may have some linking methods that overlap Types --
this is okay. Just be sure you are concentrating on the
affiliates' needs.
The Fourth Step is to decide commission levels. Your
first decision will be to determine whether you want to pay a flat
rate or percentage of each sale. Based on the needs you identified
above for each of the affiliate types, decide on a commission amount
for each Type. If you have a two-tier program, consider the
possibility of different second tier rates as well.
The Fifth Step is to devise promotions for affiliate
groups. Once you have your affiliates properly categorized and your
system under control, consider developing promotions for your
affiliate groups. Give them special incentives to sell more during a
certain time frame, move seasonal products, or increase business
during your slow months. Offer them additional commissions, or even
bonuses for reaching a specific amount of sales.
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Many affiliate marketers make a huge mistake of posting their ads
on forums. Forums can be used to promote your affiliate programs
and your website but in a proper manner. Posting banners is very
similar to spamming and may easily upset forum administrators.
-
Always do your research before promoting your affiliate program to
a potential customer. Do not offer affiliate programs to visitors
who are not at all interested in the products associated with the
program. This is a futile endeavor.
-
If you promote affiliate programs offered by other merchants,
ensure that you develop your own advertising copy. Many websites
commit a common mistake of using the same advertising copy as used
by the merchant themselves.
-
Avoid Copyright infringement in all cases. Always use original
content or ask permission to use graphic images or text found on
other websites.
-
Do not submit your programs to free websites. These may be free
but your programs would hardly ever be noticed, especially by
Search Engines. Moreover, your own ranking would get lowered if
you submit your affiliate programs to such websites.
-
Avoid using caps on your web page or email ad. Using caps is
symbolic to shouting, which never goes well with potential
customers. A few words may be written in capital text to give them
additional emphasis. However, such practice should be limited.
-
Always respond to all queries sent by visitors as soon as
possible. A slight delay in your response could easily result in
loss of a potential client.
-
Do not use pop-up ads along with your webpage. Most surfers are
likely to close their browser if they come across pop-ups.
-
Do not host your website on a free server or use free email
accounts. This gives a negative impression to visitors. Using free
hosts and email accounts looks cheesy and loses sales.
-
Many websites do not have an opt-in list. Create an opt-in and
opt-out list for your visitors. Without these, there is no way of
tracking potential customers. Visitors should be allowed to opt-in
at any time as well as opt-out at any time.
-
Most sites have a poor tracking mechanism. It is essential that
you track all business activities. Accurate record keeping is
crucial. There are many software tools, discussed earlier in this
chapter, than can automate your record keeping process with
minimal error.
-
A 'mall' site is best used as a central hub to send visitors to
your other domains. As a main or only site, unfocused mall sites
don't get traffic from the engines, and they don't convert well to
sales. Highly focused theme sites attract traffic and sales.
-
Offline advertising may not be effective. A lot of money and
effort should not be wasted on offline advertising. Most people
rarely check websites that are advertised in local magazines or
newspapers.
-
Avoid focus on animated banner ads. These simply use up bandwidth,
thus making web pages load slower.
-
While advertising do not degrade other competitors. It is
recommended that you highlight your products’ uniqueness and
superiority but never mortify other products.
-
Banners or text links that expire are guaranteed to eventually
send your visitor to a broken link or show a broken graphic on
your page. Time sensitive advertising is best used only in email
advertising campaigns.
-
Never put affiliate links on your homepage. This is similar to
asking your visitors to leave immediately. Give them a chance to
browse, sign up for your newsletter and decide that they'd like to
come back to your place before introducing them to your
affiliates.
-
Technology changes with amazing speed. To keep up with this
rapidly evolving industry, you must invest time and money in
research. The investment is a tax write-off, and will pay you back
many times over in additional revenue.
-
Finally, persist with your plan. It might take you time to get
established even if you have a solid marketing plan. Persistence
is the single most important factor in determining success online
or off.
LinkShare hosts a password-protected website that offers
affiliates a choice of hundreds of merchant programs. On the site,
affiliates can join new programs, get links to put on their sites,
and then see reports about how their links are performing and how
much they have earned.
When a visitor from an affiliate's site clicks on a link and
goes to a merchant's site, LinkShare keeps track of all of the
transactions that the visitor makes. If that visitor buys something
on the merchant's site, you get a commission. In some cases,
affiliates are compensated even if the visitor doesn't buy anything,
just for having driven traffic to the merchant's site.
LinkShare also provides affiliates with customer service, notifies
affiliates about new programs and new opportunities, and offers
resources for affiliates to learn about how to get the most out of
their programs.
ClickBank (http://www.clickbank.com) has a built-in affiliate
program. It offers all features of a good affiliate program. There
is no need to install any expensive scripts on your website. You can
start signing up affiliates right away as soon as you open your
account.
The beauty of ClickBank is that it integrates the affiliate
management program with an in-built payment gateway. ClickBank is
one of the most popular and easiest services to use for payment
processing online. Sign-up is quick and you get approved and running
in one day.
The ClickBank Control Panel is easy to use. You can get
familiar with the whole system in no time. It costs $49 to open a
ClickBank account. This is pretty cheap when compared with other
payment processing systems. Once you open an account, all your
transaction money gets deposited into your account. You are paid the
full balance every two weeks.
I’m a member of probably about dozen different affiliate
programs, and have literally hundreds of webmasters signed up in the
programs I run myself. If you’re serious about earning serious money
on the Web, then you’re going to be spending a lot of time checking
out affiliate programs and tracking your responses. It’s one of the
easiest and most reliable ways to make cash with a website.
So far, we’ve talked about the kind of marketing plans that
work through your website: banners, links, affiliate programs etc.
But the website isn’t the only way to get the traffic you need. In
the next chapter, we’re going to begin talking about how you can use
e-mail to drum up business.
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