Affiliate Marketing 101

Affiliate marketing is a pay-for-performance model where you pay others a commission when they sell your product. They essentially do all the marketing work for you and you only need to pay them if they are successful in making the sales. Getting into affiliate marketing can be very valuable for your business, but here are some tips to ensure success.

Determine who will be marketing your product

You will want a variety of different channels who will be marketing your product. These can include niche websites, a shopping website, or an email newsletter. Ideally, you want to focus on quality, not quantity. There is no limit to how many you can choose, however. The most effective affiliate marketing campaigns involve recruiting a handful of affiliates that do great work and can generate a lot of traffic through their channels, rather than hundreds of affiliates who do mediocre work.

Figure out the commission rate

Some commissions are 3%. Some are 90%. Most are around 15-20%. It depends on the volume of products expected to move and the cost of them. If you are selling a low-end, high-volume product, your rate will be lower. The commission rate you are willing to give up will determine the quality of affiliates you can expect.

Practice good recruitment

Build relationships with potential affiliates first. Nothing is more annoying to a high-end affiliate than a spammy email asking for their help. Offer value first, then approach them later with the affiliate offer – and be prepared to offer a good rate!

Track your affiliates and commissions

You can have software installed in-house to track them, or you can do it through a third-party. Either way, you need a sophisticated method to track sales and how many of them are coming from which affiliates. If you choose a third-party method, be prepared to pay them a percentage of the sales as well for their efforts.

Beware of fraud

Research your affiliates first. Ensure that they have a reputation for doing good business. Some affiliates will buy the products themselves, pocket the commissions, then return the products. This is a common type of scam. Additionally, make sure they will be using legal methods to sell the products, as you could be held liable for their actions.

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