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How to Start an Affiliate Program by OSI Affiliate Software How to Start an Affiliate Program

Everything You Need to Know About Creating an Affiliate Program

If you're the owner of a successful ecommerce website you have probably already gone through the labyrinth of SEO, and PPC marketing strategies. But there is one more channel you have probably not explored: . This ever-evolving channel continues to benefit entrepreneurs and because it does not involve any risks.

Affiliate marketing can become an incredibly useful channel for any online retailer, especially when done right. Nevertheless, a lot of your success will rely on the type of products you sell and how well you incentivize your affiliates.

Running an ecommerce affiliate program can be a time-consuming and daunting task. The biggest problem is that most eCommerce owners get into affiliate marketing without understanding what exactly it is they should be doing. They are told that they need to create or expand an existing program, but just as they start getting some traction they hit a growth wall.

In this guide we will take a closer look at affiliate marketing and how it applies to online stores, in which circumstances it should be set-up, how you can create a powerful network of promoters, and much more.

Chapter 1 What is Affiliate Marketing? Connections are the heart of . Affiliate marketing takes this concept to a new level by allowing people to sell their products online through websites and . It is a performance-based model through which businesses reward their affiliates for the traffic and sales they bring to their online stores. Traditional affiliate marketing involves adding banners or contextual links to the eCommerce site. These leads are tracked with a unique affiliate ID and rewarded with a percentage of any sales originated from these leads.

Webmasters who are looking for an easy way to monetize their sites, other than ads, can implement affiliate marketing. If you are a webmaster looking to get into affiliate marketing, you would sign up for affiliate programs and promote products that are within your niche.

Once you find a product that you want to advertise, you will be given an affiliate link. Whenever a visitor clicks your affiliate link and completes a sale, you will receive a commission.

As an owner of an online store your goal is to find affiliates that are ready and willing to promote your products on their website, thus expanding your online reach and increasing sales. At first glance, affiliate marketing sounds like the answer to any retailer’s dreams. However, there are some sticky issues that you need to take into account, like determining the ‘cut’ that you can afford to reward without negatively impacting your bottom line. Chapter 2 IS AFFILIATE MARKETING RIGHT FOR MY ?

To find out if affiliate marketing is the right choice for your eCommerce business you should first answer the following questions:

1. What products/services can I advertise on my affiliate program or affiliate network? 2. What potential affiliates could promote my products? 3. How much will my sales increase? 4. Should I join an existing affiliate network or create my own? All of these questions stem from a simple, yet extremely important, cost/benefit analysis.

You should also check out relevant case-studies for online stores in your niche that have already used affiliate marketing. What were their typical conversion rates? What are the typical revenue shares that ad networks are taking? How did these companies incentivize their affiliate partners to promote their products?

Here are a few case-studies that you should check out:

Case Study #1: Ecommerce Sites Generates 6% more conversions with Affiliate Marketing Case Study #2: 11% Percent of Retailers Revenue Comes from Affiliate Marketing Case Study #3: Five Performance Marketing Case Studies from - See how House of Fraser perfected its affiliate marketing campaign.

Why would a store want to set up affiliate marketing?

Despite the fact that affiliate marketing means that you will have to part with a percentage of your sales, it has innumerable benefits. Here are 5 reasons why you should consider setting up affiliate marketing for your eCommerce store:

1. Extend your Reach The greatest advantage of affiliate marketing is the fact that it enables companies to connect with more potential customers in relevant niches. Furthermore, affiliate marketing programs can significantly boost sales especially during times when they are experiencing slumps. For example, if your Sunday sales are weak, you can offer special coupons to your affiliates to improve your Sunday sales. Of course, this also means that you have to identify your top-selling products and have the margin for a discount that will actually drive sales.

2. Have a Competitive Presence

Affiliate programs will enable you to be present at the actual point of purchase, where your competitors also are. This is a great thing, especially when prospects have to choose between one and another.

3. Pay Affiliates Based on Performance

One of the best things about affiliate marketing is the fact that you compensate your affiliates based on number of sales. This will help you set realistic marketing expenses and attribute them directly to your revenues. With PPC you can never guarantee the success of a campaign and you might end up affecting your bottom line.

4. Easy Tracking

Like most other marketing strategies (SMO, SEO, , etc.), affiliate marketing is also easy to track. As an online store owner you can check how many clicks generated from your platform, and how many purchases were made via affiliate links.

5. Focus on Late Purchase-Process Conversions

As you are probably already aware, the buying process can occur over a longer period of time because many customers need an extra incentive to complete a transaction. Chapter 3 WHAT ARE THINGS TO CONSIDER WHEN SETTING UP AFFILIATE MARKETING? 1. Understand the Costs Involved with Setting up Affiliate Marketing

Cost-wise, there are three things you need to consider when it comes to affiliate marketing:

Platform costs You will need to choose an affiliate marketing platform to run your operations. Management Costs You have the option to bring on an affiliate manager. If you use OSI Affiliate Software, you are not required to have an affiliate manager because we make it easy to setup and manage an affiliate program. However, some companies choose to have an affiliate manager. Design Costs Lastly, you will have to find someone who can design your promotional materials, create videos, and optimize landing pages.

2. Competition is Fierce

Because affiliate marketing is extremely easy to set-up, many people try their luck with it. There are literally thousands of affiliates. This means that competition is very high. To make matters worse, some of your competitors are also skilled SEO experts, social media managers, and internet marketers.

3. You are Forced to Take Risks You have to pay affiliates whenever a sale is completed from a customer responsible for making the referral. For the customer this is great news, but this means that all the marketing costs and risks are placed on your shoulders. Even if your affiliates send massive levels of traffic to your site, this won’t help if people don’t buy. Also, if the product is bad, or your prices are too high, affiliate marketing won’t yield the expected results.

4. Determine the Cut that you can Afford

You will have to do some serious math to figure out the percentage you can afford to give to your affiliates. Can you give up 5% of the revenue that comes from a referral sale? How about 15%? The higher you set the percentage, the higher the chances of attracting relevant affiliates. Chapter 4 HOW TO SET UP AN AFFILIATE MARKETING PROGRAM Affiliate Marketing Software or Affiliate Program Manager?

The simplest and most effective method of starting an affiliate program is by establishing and running it yourself. This will give you more control over who you work with, as well as your commissions. However, if you're a small business, setting up your own affiliate program can prove extremely time consuming. You will have to manage each affiliate account, keep up with agreements, update affiliates about discounts or offers, and ensure that your promotions are not misinterpreted online.

Another option would be to find an agency that can take care of the administrative tasks of an affiliate network. Because most networks specialise in specific sectors you will gain access to a wealth of affiliates. keeps in mind, however, that most networks charge around 30% commission for each sale, so you have to subtract this from your bottom line. This solution is generally recommended to high-volume eCommerce businesses.

How to Set-up your Own Affiliate Program

Your affiliates can become an incredible asset for your eCommerce business. Here are the basic steps to setting up your own affiliate program: Step #1 – Choose the Right

As previously mentioned, the first thing you need to do is to decide on the program that you will be using for your website's needs. What program or script will you be using to manage affiliates and process payments? There are several options, each with its pros and cons, so you have to choose wisely.

Joining an affiliate network. The affiliate network will make it easier for you to get started because it automatically tracks and recruits affiliates for you. Keep in mind that the network will probably also charge a monthly fee or commission for utilizing the service. Running your own program or script. You either have to create your own script or use an affiliate tracking software SaaS solution.

Step #2 – Make Yourself Noticed

The open web is flushed with thousands upon thousands of websites and millions of products. Your goal is to stand out from the rest. The most difficult part of affiliate marketing is attracting customers to your site. To increase your chances of success you must invest in powerful advertising. One of the best way to do this is by providing your affiliates with the great resources, such as:

High quality graphic banners Relevant reviews and articles about your products Product samples or excerpts Solid marketing plans and social media presence Promotional videos and visuals.

Banner Sample

Step #3 – Request Feedback from your Affiliates

No affiliate marketing is perfect from the beginning. To ensure that you’re moving in the right direction you should communicate with your affiliates often. Communication is important, not only when you are experiencing problems, but also when there’s an abundance of sales. Here are a few ways in which you can request feedback from affiliates:

Create online surveys with free services such as SurveyMonkey and send them to your affiliates. Send emails to your affiliates enquiring about their issues or desires. There are many factors that can result in a dip of sales and your affiliates are, undoubtedly, the best people to ask. Set-up forums where your affiliates can discuss and seek advice.

Based on the feedback you receive you should make necessary changes. This will help your program move in the right direction. No matter how busy you are, you should always make time for your affiliates. Otherwise, you run the risk of losing them. Make sure your contact information is displayed so that they can contact you easily.

Step #4 – Experiment & Improve

There's no sure-fire formula for affiliate marketing success. Strategies that work for other companies might not work for you. That's why it's extremely important to talk to your partners and improve your offers. You can experiment with different discounts, ad formats, and strategies. Find out what works for you and repeat it.

You can keep track of your affiliate program through special platforms, or from Google Analytics. Metrics such as bounce rate, traffic, average time spent on site, and conversion rate are strong indicators. Chapter 5 HOW DO I RECRUIT AFFILIATES TO JOIN MY PROGRAM

Affiliate partner recruiting is, arguably, the most important aspect of setting up a successful program. It is extremely important to find partners that are relevant to your business, and will drive targeted traffic to your site.

There are two kinds of affiliate recruitment:

Active – affiliate partners that you reach out to.

Passive – affiliate partners that find you and sign up for your program.

According to a recent study conducted by the Affiliate Summit, there are multiple ways in which you can recruit affiliates. Here’s how recruitment looks like through the eyes of the active affiliate partner: 42.4% direct contact, 36.3% network emails, 29.6% blogs, 17.8% online ads, 8.9% conferences, 4.4% conferences.

Active Affiliate Partner Recruitment

The most common strategies for actively recruiting affiliate partners include, but are not limited to:

Promoting software and tools that your partners need. If you are trying to promote your software or online tool, your most valuable partners may actually be customers who have tested and are satisfied with it. You can reach out to these potential partners via email, or social media. Seeking affiliate partners with the help of online tools. You can use tools such as AffiliateRecruitment.com, SemRush, Ahrefs, Citation Labs, BuzzStream, or SEOQuake to discover good affiliate partners. By using these tools you will be able to find authoritative blogs or industry leaders that can attract new customers to your site. Engaging with potential partners on social media. Sending recruitment emails. Email marketing is another effective strategy for attracting affiliate partners to join your program. Your email should be friendly, concise, and most importantly, personal. It should start with a catchy subject line, a short introduction of your company, an explanation for why you are sending the email, a personalized comment, concrete data about your affiliate program and its competitive advantages, plus information about your CTAs. Here’s a good example:

Attracting potential partners through organic search. Reaching out to potential partners through summits, symposiums, or conferences. Encouraging potential partners to set-up affiliate marketing after reading reviews from satisfied customers. Employed structured-based recruitment strategies. Chapter 6 HOW DO I INCENTIVE AFFILIATES TO PRODUCE MORE REFERRALS

The success of affiliate program is largely determined by how involved the affiliates are in promoting your service or product. There are several strategies and bonus types that you can use to incentivize affiliates, such as higher commission rates, discounts, or cash bonuses. Depending on your business, some strategies will be more successful than others. Regardless of what method you choose to incentivize your affiliates, you should never lose sight of your business goals.

Setting realistic incentive programs will help you keep affiliates happy and increase revenue. A while ago we talked to an affiliate manager who was thinking of changing his approach. In his eagerness to incentivize affiliates, he decided to go for a “one size fits all” mentality.

In other words, he promised his affiliates a 10% commission on their sales, if the total sales would double by the end of the month. For the new affiliate, who only had a couple of sales completed, that was great news. But for top-performing partners, who generated five or six figures every year, the goal was impossible.

The result? The best affiliates felt punished. They realized the bonus was impossible to obtain and decided to focus on other programs that offered more attractive long-term benefits.

As you can see, different types of incentives work for different types of affiliates, and the one-size-fits-all approach is rarely successful. This is why have to mix up different strategies.

Let’s take a closer look at the basic types of affiliate incentives:

#1 Tangible Rewards

Tangible rewards can come under the form of cash, or items/bonuses (e.g. an iPhone, a paid vacation, etc.). While affiliates are not easily swayed by tangible rewards such as gadgets, a recent study conducted by Perks.com revealed that most affiliates love them.

“While the performance of a group of participants rewarded with cash and another group rewarded with tangible incentives improved during the program, the increase shown by those receiving tangible rewards was nearly 50% more than those of the other group.” Source: Perks.com

The explanation behind this is simple: most people spend cash responsibly, but they don’t actually enjoy it.

“Nearly two-thirds of respondents (62%) feel that cash is remembered for the shortest time.” – Incentive Federation Study, 2005

A tangible reward is something that they would, under different circumstances, not spend money on, but that they consider awesome. What’s more, non-cash rewards lead to increased ROI. Three times the ROI, to be more precise.

#2 Short-term incentives

As the name suggests, short-term incentives refer to limited offers.

Example: “Increase sales during December by 30% and you’ll receive *insert reward here*.”

As a general rule, you should set-up short-term incentives to accompany long- term ones. Furthermore, as you set your short-running incentives, make sure to differentiate reward conditions between top-performing affiliates and regular ones.

This will help you avoid the alienation described in the example above. To continue our example, you could ask your regulars to increase sales by 30%, while top performers are asked to increase sales by 10%.

First Sale Bonus. Affiliates who aren’t driving traffic or sales through your program have probably not integrated your program into their sites yet. A great way to encourage them to engage with your affiliate program is to offer them a first sale bonus.

Example: “Win a $10 bonus for driving just one sale between now and the end of the month.”

This should encourage them to at least set-up your banners. Of course, there is always the chance that these affiliates will use their own links to complete a purchase, but even so, this means that they will browse your site to learn more about your brand. Another option would be to offer your partners a bonus on the second or third sale, to minimize the risk of potential abuse.

Example: “Win a $10 bonus for driving your first sale, and an extra $10 for your second and third sales.”

Prize draws are particularly attractive for smaller affiliates. For increased success, you can offer multiple prizes, instead of a big one, to include as many participants as possible. For example, you can offer exclusive tickets to a great play, all-inclusive trips to Venice, etc.

Prize Draw for GameChangerGlobalSummit (screenshot)

Case-study: According to ecoConsultancy, Red Letter Days won the A4U Award for Best Advertiser Incentive because it created very inclusive rewards. The company tiered its volume targets and increased prize values for targets that were able to promote their product to a wide range of affiliates. In return, the affiliates produced a 152% increase in revenue.

#3 Long-term incentives

Long-term incentives give your affiliates something to look forward to at the end of a year.

Example: “Help us sell products worth $10,000 through affiliation and receive an all-expenses paid getaway in Thailand.”

I recommend that you give outstanding rewards to top producers, provided that they maintain a certain volume of sales for a given period of time.

You will have to set these rules yourself.

Here are a few ideas:

HootSuite Affiliate Program on different platforms

Performance based incentives for all affiliates. Rather than hand a hefty prize to your best affiliate, why not offer incentives based on percentage increase in sales, from one month to the other. This will enable you to include all affiliates, re-engage with inactive ones, and keep your overhead under control. Examples of performance-based incentives: bonus payment, discount code, cash reward, increased commissions, etc. Set-up Milestones. Milestones are, and forever will be, the backbone of any affiliate program. Setting up realistic objectives will encourage your affiliates to promote as soon as possible. To scale this type of approach you will have to correlate sales with the effort made to complete them. If you’re not willing to work for a certain bonus, your affiliates probably won’t either. For example, a pat on the back for the associate who earned 500 new customers is not going to cut it. A hefty bonus, on the other hand, might. Gamification (meaning: the use of game thinking & game mechanics in a non- game context to engage users). Believe it or not, some affiliate marketers don’t care about the money. They care about the experience, reputation, and respect of fellow affiliates. If this is your case, you can reward partners by simply offering them badges that they can publish on their social profiles or sites, creating leader-boards, etc.

Affiliate member badge - FireDrop

Increase Commissions on Certain Products

As you probably already know, some products & services sell better than others. If you have excess inventory, or a new type of product, you can draw attention to it by running increased commissions. A plus-side of this strategy is the fact that you don’t necessarily have to limit your promotion to a specific affiliate tier. Increased commissions are flexible and can be applied to all affiliate tiers.

Recommended Read: Multi-Tier Commissions to Affiliates

Fixed Bonuses for Achieving Sales Threshold

We have already mentioned this type of incentive, but we’d like to talk a bit more about it. Generally, affiliates are divided into three groups:

Bottom tier Middle tier Top tier

The secret to a successful rewards program is to make all affiliates happy, especially top-performers. In order to incentivize top-tier affiliates, and encourage bottom & middle tier affiliates to become top-tier ones, you have to differentiate between fixed bonuses.

Take a look at your middle-tier performers to find out how far they are from becoming top-tier. Let’s say your threshold for top-tier is $10,000. If you have 10- 20 middle-tier affiliates that generate around $7,000-$8,000 in sales, it might be worth offering them a $500 cash bonus to encourage them to exceed the $10,000 mark. Sure, you’re giving away a lot of cash, but you will also be increasing sales by at least $2,000/affiliate.

Setting up individual prize thresholds is time-consuming. I know. The only way for this type of incentive to be profitable is if you carefully analyse and calculate feasible sums. One way to save time is by mixing fixed bonuses with percentage- based performance bonuses.

Example: “For every 10% increase in sales, win an extra $100.”

This way, instead of sending specific messages to each affiliate, you can send a blast to your email group.

The 80/20 Rule

Are you familiar with the 80/20 standard in affiliate marketing?

80% of sales come from 20% of your affiliates.

In other words, your top-performing affiliates are the most important ones. Therefore, they should feel the most valued.

The statistics shared by one of our active merchants are incredible. In his case, 76% of sales were driven by 27% of active affiliates, and more than 48% of sales were driven by the top 4% affiliates.

Don’t forget to keep your top performers happy at all times by offering them amazing incentives. If you are still not sure what type of incentive you should use, you can simply ask for their opinion. This will make them feel even more valued.

Affiliate Incentives that Don’t Work

Many ecommerce owners fail with their affiliate program because they use incentives that don’t work. The first example that comes to mind is an incentive that rewards only top-level affiliates. While it is a good thing to reward top- performing affiliates, this might determine smaller ones to feel shut out.

.You have to constantly evaluate strategies that will help you re-engage with your partner base, both big and small. A very simple way of making everyone feel valued is to reward on a percentage increase, rather than a fixed prize.

Wrapping up…

Affiliate marketing is a big deal for eCommerce stores. The industry has grown and affiliates are now fully capable of driving significant sales to your business. Ubiquitous incentive prizes and small cash prizes may no longer work for some affiliates, but items that your partners are interested in will. The key to a successful incentive program lies in knowing the needs and desires of your partners.

There are literally hundreds of incentives that you can use, but you should always remember to keep it simple. Don’t overthink your incentives. Make sure your partners know exactly what they need to do in order to participate and exactly what they are going to win.

It goes without saying that the promises you make must be kept. If you offered to give a reward, make sure you stick to it. Chapter 7 MARKETING YOUR AFFILIATE PROGRAM

The landscape for affiliate marketing has changed tremendously over the last couple of years. At present, Google is breathing down the neck of thin affiliate content, and the competition is becoming increasingly fierce. Despite these obstacles, the potential of adding a few thousand dollars to their income has encouraged many affiliate marketers to get ahead in this game.

Below are several proven affiliate marketing strategies that you should take note of. Some of these strategies will apply to your affiliates, and should be discussed with them beforehand to maximize results, and the others will apply directly to your ecommerce site.

Proven Affiliate Strategies for your Ecommerce site

1. Don’t Lose Focus

One of the biggest mistakes that new affiliate marketers make is that they go one mile wide and one inch deep. In other words, they try to dominate dozens of competitive niches too fast.

It can be very hard to focus on only one niche when your friends are making millions from make-up and fashion products in emerging niches. However, spreading your wings across too many niches will result in an inconsistent strategy, which more often than not, results in pitiful sales.

2. Build a Brand that Adds to the Consumer As we already mentioned, Google’s brand-bias is strengthening. For small eCommerce businesses this is a huge concern. Take a look at the leading sites in huge niches such as property, travel, fashion, or homeware. You will note that many of them, not only have great affiliate programs, but also strong brands.

Sites like Houzz, Compare.com, or LastMinute.com are extremely successful firstly due to the strength of their brand and secondly due to their editorial integrity. Your purpose, as an eCommerce owner, should be to create valuable landing pages with great product descriptions, crisp images, and real reviews. This will improve the experience of the user and lead to better affiliates.

3. Promote Products that Will Raise your Affiliate Income

I cannot stress enough the importance of promoting products that will actually help you grow your affiliate revenue. When I got into affiliate marketing I tried to promote products ranging from $0.50 to $100 commissions. Once I was able to identify the products that added value to my target audience, I focused on promoting it to affiliates. This increased my site’s revenue by an order of magnitude.

Remember, thousands of $1 commissions can drive as much revenue as 10 x $100 ones.

Are you currently generating $3,000/month from affiliate marketing? Try to think about the products that will help you generate $30,000/month. The answer is simple. You have to either add an extra zero to your commission plan, or to increase the amount of traffic that affiliates send to you.

4. Target Topics, Not Keywords

Google hasn’t been subtle about its intention to reduce the SEO community’s focus on keyword targeting. First it removed keyword data from Google Analytics (now displayed as ‘not provided’), then it changed exact-match targeting in Adwords. This has made it more difficult for affiliates and eCommerce owners to focus on individual keywords.

This is actually a blessing in disguise. Since the implementation of Hummingbird, which is capable of understanding the contents of a page and semantic value, and the release of RankBrain, it has become clear that keyword targeting is no longer effective. Instead of over-optimizing your pages for specific key phrases you should focus on capturing long tail traffic and using low-competition words & synonyms that are relevant to your niche.

5. Go Mobile

This tip may seem a bit out-dated, but don’t tell me you weren’t warned. At the end of 2014, mobile accounted for46% of affiliate clicks. Furthermore, mobile traffic has now surpassed that of desktop traffic.

But what does this mean for the individual affiliate or ecommerce business?

If your website is not mobile friendly you are losing a lot of potential customers. As more and more people start purchasing from mobile devices, certain niches (e.g. fashion, apparel, etc.), will become more popular. Crafting a solid affiliate will help you capitalize on these niches.

Google has also made it very clear that mobile-friendliness is paramount for websites to rank well with its Mobilgeddon update and mobile-friendliness checker. In other words, failing to optimize your site for mobile devices will affect, not only your affiliate strategy, but every aspect of your business.

6. Encourage Reviews

Reviews are, arguably, the strongest indicator that your products are valuable. The vast majority of online shoppers will read the reviews of other consumers prior to making a purchase. However, not all of your customers will leave reviews without receiving an incentive.

You can persuade your customers to leave reviews on your products by offering them a discount on their next purchase, or by making their experience unforgettable. Going the extra mile will also help you turn one-time shoppers into returning customers.

Note: Having only positive reviews might do more harm than good. Striving to create a perfect review profile is natural, but it will make your brand seem fake. Recommended Read: Fake Positive Reviews in Affiliate Marketing

Proven Strategies for the Affiliate Partner

7. Create Content that Other Affiliates Can’t Compete with

One of the biggest challenges of affiliate marketers is to prove their value as middlemen in an overcrowded market. The good news is that if you act quickly and create valuable content, you can gain the competitive edge.

By consistently crafting content that identifies the needs of consumers and educates or moves them, you can persuade them to make the right shopping decisions. Many successful marketers create huge guides that educate readers throughout their buying decisions and present both positive and negative aspects of a product.

Samples of great content:

— The Best Scotch Whiskies, by QOSY — 10 Best Perfumes for Women, by Elle Google will always consider that these kinds of posts add value to the internet. After all, someone spent more than 30 hours to create a 5,000+ article that received 10,000+ shares. Affiliate links for these kinds of posts can be included within the article, or as banners on the side.

8. Only Promote Products that You Are Familiar With

The number one rule of affiliate marketing is to recommend products based on your experience. If you’re not confident that a product is worth promoting, or you don’t feel positively about it, it would be better to not deceive your readers. Personal experiences and opinions matter as much as reviews, and promoting services/products that disappoint your target audience might result in your losing their trust. If you have reviewed multiple products you can create a resources page where you share helpful links to websites within your niche.

9. Promote Maximum One or Two Products of the Same Type

There are several reasons why you should never promote more than two products of the same type:

If you keep promoting the same products over and over again your readers will understand that there must be something special about these specific ones that you keep bringing up. The more products you promote the harder it will be for your visitors to choose between them. The more services/products you promote, the less believable you become. For example, if today you recommend product X, and next week you promote product Y, which is very similar to product X, your target audience will realize that there’s nothing special about any of them.

10. Create a Powerful First Impression

First impressions are extremely important in affiliate marketing. They set the tone for a visitor’s experience with the site, including possible transactions that will take place in the future. You don’t want a new visitor to access your site only to be harassed by dozens of advertisements.

Stop for 5 minutes. Relax. Clear your head. Access your site as if it were for the first time. What is the first impression that it gives you?

“Hi, nice to meet you. I write un-biased reviews of tech gadgets.” or “Hi, nice to meet you. Can I have your money?”

Websites that are designed for the sole purpose of generating affiliate sales remind me of cheesy guys selling jewelry from inside their trench coats. I always knew these people had fake products at unfair prices.

As a shopper, I’d much rather buy from someone that I trust or that is genuinely interested in what I need.

Important Tip: Cookie Length

In order to track traffic sources you will have to provide coded links for your affiliates. This can be done with the help of cookies (small text files) that are saved on the visitor’s computer when he/she clicks on the affiliate link.

The length of time during which the cookie is valid may vary from 24 hours to three months (or indefinitely), depending on the affiliate marketer. Some consumers will visit a product link multiple times prior to making a purchase. In other words, the longer the cookie length, the higher the chances for your affiliates to receive payments on future sales. Depending on your business model and product prices, you might want to increase cookie length.

Note: Keep in mind that cookies will be removed from the computer if the user chooses to delete them manually, and the transaction will not be completed successfully.

Popular Affiliate Marketing Implementations

As you have probably realized by now, affiliate marketing is a broad term. The most successful implementation will depend on a number of factors, including your business model and target audience. Here are a few methods that you should consider:

Banner Ads. True, banner ads are boring, but many publishers continue to use them to generate affiliate sales. Banner ads look a lot like regular ads, but they include affiliate links under the form of images. Because to most viewers there is little to no distinction between the two, affiliate banners are only successful when they are used for extremely targeted niches. rolls. I do not recommend this method of affiliate marketing to anyone, mostly because Google disapproves of it. Blog rolls can be successful when they imply direct endorsement from a highly respected industry publication, or when they are used on sites with large audiences. Product Reviews – one of the most successful affiliate marketing methods. It should be used on sites that provide information about a variety of products that visitors are interested in. For maximum success, product reviews should be un-biased and address the pain points of readers. This type of affiliate model works, not only for products, but also for services, tools, and software. There is only one serious conflict where product reviews are concerned: if the product receives a negative review, the visitor will not want to purchase it, which kind of defeats the purpose of setting up affiliate marketing in the first place. If you want to be successful with this model on the long-term, you should demonstrate to your audience that you are transparent & fair in your reviews. 'Ye Auld Coupons. This is a standard affiliate model where the value proposition is clear: to provide easy access to coupons and great deals. When implemented correctly, coupons can drive tremendous sales.

Product Aggregation - sites that aggregate and present & product information in a simple format (example: BabyGizmo).

Powerful Affiliate Marketing Strategies for Social Media

One of my favorite ways to earn traffic with affiliate marketing is through social media. However, simply posting your affiliate links on Facebook or Twitter can be quite the hassle. Here are 5 ideas that will help you add more value to your affiliate campaign with social media: #1 Link Images to the Products that you are Promoting

Images will always attract links on social media. Why not snap a screenshot of the page that you are promoting and linking it to the page with your affiliate link?

#2 Shorten Links Wisely

Link shortening can help you make your content social media-friendly. However, certain link shorteners do not allow you to preserve affiliate links (e.g. bit.ly or goo.gl). I recommend you to use tinyurl.com, as it preserves the initial structure of your URL.

#3 Deliver Value First

This should go without saying, but constantly promoting products and services will never work if you aren’t also sharing great content. Your social media content can come under the form of blog posts, images, email newsletters, YouTube videos, podcats, or infographics. I recommend you to focus on creating a healthy mix of social media posts and affiliate posts. #4 Grow your Email List with Social Media

One of the best ways to use social media for affiliate marketing is to build your email list. This will make it easier for you to send affiliate promotions via email. Because most social networks are interested in promoting their own ads it can be very tricky to promote affiliate links. Building a social media following will help you maximize conversions and mitigate risks.

But how exactly can you attract more email subscribers with social media?

Simple. Offer tons of value for free-to-gain trust. Once your following is large enough, ask your audience to subscribe to your newsletter for more great recommendations. By using Aweber you can get your broadcast emails to also post on Twitter and Facebook.

#5 Create Affiliate Redirect Links As I already mentioned, raw affiliate links are very easy to spot. Most people won’t click on them and some networks might delete them. You can solve this by creating a re-direct on a cleaner link.

For more information on how you can set-up and manage affiliate redirects, please read Simon's Guide to Links, Internal Links, and Redirects..

Reversal Rates & Estimated Earnings

Before we conclude the affiliate marketing guide for eCommerce owners we have to discuss two more things:estimated earnings and reversal rates.

Reversal rates refer to a completed sale, but for which the commission was canceled & returned. There are multiple reasons why this would happen, such as: the order was cancelled by the customer, the affiliate policy was violated, the transaction was fraudulent, the transaction was duplicate, etc.

Reversal rates should be very low. The industry standard is for 1-2% of transactions to be reverse. Therefore,you should always monitor your reversal rates. Of course, high reversal rates don’t necessarily mean a red flag, but they can be a sign of something fishy.

To help affiliates estimate potential earnings, most eCommerce owners provide metrics on the earnings of other affiliates. You should too. The standard metric is EPC (earnings-per-click), which is calculated for every 100 clicks received. For example, an EPC of $57 means that for every 100 clicks, the affiliate is generating $57 in revenue.

While it is a good indicator of potential affiliate offers, EPC is not enough to determine profitability. Once you figure out the EPC you can calculate RPM, as follows:

RPM = (EPC/100) x (CTR x 1,000), where CTR is click-through-rate

With the help of this equation you will be able to summarize conversion rate and commission percentage.