How to Set Up a Successful
Affiliate Program

• Requirements
  - It is hard for you to lose money with affiliate programs especially if you are running a pay per sale program. However it is important to realize that you must share a large proportion of the profit with the affiliate. Hence you should be selling a product with a relatively high profit margin
  - You must have a high quality product/service. Most of your successful affiliates will only recommend your products once they have tried and tested them
  - You must have a good visitor to sale ratio - it's no good having customers sent to you without being able to convert them into sales. This will also lead to affiliates switching to another program. Check out the internet marketing courses offered by Corey Rudl and Ken Envoy. They offer excellent techniques to help you convert customers to sales.
  
   
• Commissions
  - You must pay out high commissions because you are paying for life long customers. Once you get a customer you can sell other back end products indefinitely. There is growing competition for affiliate programs and there are many affiliates who base their decisions only on the commission structure
  - Make sure that you track all affiliate sales even sales which occur months after the initial customer visit. Some affiliates may even check to see if their sales are tracked by ordering something themselves. Try to also track sales by 1-800, snail mail and fax. Once you establish a system which pays the affiliate for every sale you can start promoting your affiliate program more effectively
  - Give your affiliates a choice of pay per sale, pay per click or pay per lead - each affiliate site has different ways of maximizing affiliate revenue. It is not uncommon to offer a combination of these methods and let the affiliate choose which method they like. With pay per sale it is important to let the affiliate know that any product returns or credit card charge backs will result in a debit to their account.
  - Pay higher commissions to more productive and successful affiliates - structure commission tiers so that affiliates can receive higher commissions after they reach certain pre-determined order levels
  - Set a monthly minimum payment level and automate your check paying process - this will give you more time to concentrate on affiliate support
  - Don't charge an affiliate membership fee - most affiliate programs are free
  
   
• Linking
  - Provide affiliates with all the text and banner links that they need. As soon as they sign up transfer them to a page where they can choose which links they think will work best for them.
  - Don't make all links go to your homepage. The amount of choices may confuse the visitor. Instead let affiliates choose individual products or services from an online catalog and make links for different product pages.
  - Develop co-branding especially with your best affiliates. Give them the opportunity to link to pages on your site which have their logo on the top and include a link back to their own site. This will encourage affiliates to devote whole product pages on their site in order to integrate it with your own.
  - Work on developing shorter affiliate links so that affiliates can use them in their newsletters and when posting to newsgroups. Alternatively show them how they can place a short url in their e-mails which takes them to their web site and then redirects to your company's site.
  
   
• Affiliate support
  - Help affiliates by giving them good training material. The most effective affiliate marketing occurs when affiliates blend in your links with their site's content. Give them ideas on how to write persuasively and increase their sell through rates. Distribute free product reports which they can blend into their sales copy.
  - Help affiliates which devote whole product pages to your site by showing them which keywords to use so that they rank better in the search engines
  - Update your affiliates on program enhancements, provide them with occasional promotion tips and run frequent affiliate special offers.
  - Provide your affiliates with real time tracking. This is important because they will trust your tracking capabiities. It will also help them test their links. They will be able to tell which links are working better than others and which products they should be giving more attention to.
  - Its a good idea to notify the affiliate by e-mail whenever a sale is made. Weekly commission reports should also be e-mailed showing how many visitors the affiliate has sent and what their conversion ratios are. 
  - Publish an affiliate newsletter and send it to your affiliates on a weekly or monthly basis. Let them know how they can communicate with you. Set up discussion boards where they can ask questions and exchange ideas with other affiliates. Be sure to give adequate technical support and service.
  
   
• Affiliate software
  - You must choose you affiliate software wisely because you need to be able to track every single affiliate sale. You also need to be able to track two tier commissions and  sales which occur after the first visit. This is important because most other affiliate programs are already offering these features to their affiliates and you will probably not be able to compete with a simple tracking system. Make sure that the system you choose is fully automated right down to the processing of affiliate checks because you will need all of your time to motivate and support your affiliates. Check out the article on affiliate sales tracking software. You can also review the main features of the major third party networks if you prefer to have your program administered by an independent affiliate network. 
  
   
• Attracting affiliates
  - The success of your affiliate program ultimately depends on your affiliate workforce. However more is not always better. You should concentrate your limited time and effort in attracting only those affiliates which have the ability to generate the most sales and spend most of your time in helping those affiliates generate sales for you. Your affiliate recruitment campaign should be centered around the web sites, newsgroups, mailing lists and discussion forums where your target market is most likely to meet. When you find out where your target market meets e-mail the individual site owners and ask them to become a part of your affiliate program. Advertise through the same channels and help others promote your site as well by offering two tier commissions. Offer a great affiliate compensation package and an exceptional product/service and you will be successful in your recruitment. Read the article on attracting affiliates for a more detailed analysis.
   
• Motivate affiliates
  - Make it easy for affiliates to join your program. Don't charge a set up fee.
  - Guide your affiliates step by step throughout the sign up process and provide a detailed FAQ sheet for new affiliates.
  - Most affiliates don't do anything after the sign up process. Either they don't have the time or they've found another better program. As soon as they sign up show them exactly where to go to get their links so that they can post them immediately. Give them detailed instructions on how they can copy paste their affiliate code into their web pages.
  - Show them where to go to check on their commissions and update their personal information.
  - Just in case they dont have time to do this when they sign up follow up with a few e-mails showing them exactly what to do to get started.
  - Let them know of any promotions you have or any benefits they can get by reaching certain sales quotas. Give successful affiliates personalized entry pages to reward them and motivate them even further.
  
   
• Most successful affiliate programs
  - If you dont have an affiliate program yet and are looking to set one up, these are the most successful categories which affiliates look for: Jobs, hardware, travel, books, marketing, gambling, software, advertising, web hosting and real estate. Other categories which are also worth looking into include: Music, food/gifts, clothing, investments, consumer electronics and auto/accessories. 
  
   
• Pre-screen affiliates
  - Try to pre-screen affiliates. Even though affiliates which are not active can still be used as cutomers they can still sometimes get you into trouble. Some affiliates may not have a site at all and just spam newsgroups with your affiliate links. Others may post your links in sites of questionable nature and put your reputation at risk.
  
   
• Make affiliates your customers
  - Most affiliates do nothing after they sign up. Most don't even set up links. It is a well known fact that only 20% of your affiliates generate most of your sales. It's usually a better idea to concentrate on motivating and helping your active affiliates and converting the rest into customers. Let them know that it is ok for them to buy from their own links and receive a commission. Keep them on your mailing list and keep them updated on any new products you may have in the future.

Webmaster Articles

Affiliate Strategies | What is an affiliate program | How to pick a good program | Affiliate programs to avoid

Merchant Articles

How to attract affiliates | Set up a successful program | Tracking techniques