Reap What You Sow
Smart marketers establish a strong foundation to grow their affiliate programs
April 2008 By Kristin Hall
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Marketers hoping to launch a new affiliate marketing program—or invigorate an existing one—should recognize that the best affiliate marketing programs are built on relationships with clear rules of engagement, strategic planning and a steady stream of compelling consumer promotions.
Attracting Affiliates Is Only Half the Battle
It’s not enough for affiliates to join a program if their marketing partners do little to help them succeed. Affiliates cannot deliver on marketing goals unless the objectives are shared and the right tools and information are made available.
All affiliate programs operate within their networks’ standard affiliate agreements, which outline payment frequency, regulations and standards for fair practices. But each marketer also can establish special terms and conditions. The terms and conditions are established at the onset of a program and must be effectively communicated to all affiliates. Within the terms and conditions, marketers can establish brand requirements, creative placement criteria, search engine marketing policies and more.
One critical component of any successful affiliate marketing program is a competitive payout. The payout is based on the commission rate, generally the percentage of sales the advertiser is willing to pay affiliates; the commission duration, which is the time period allowed for affiliate traffic to convert into a sale the marketer will credit to the affiliate; and the conversion rate. The payout should make a program attractive to affiliates relative to competitors in the advertising category, while helping the marketer achieve its financial goals.
Some marketers offer a tiered commission structure, encouraging affiliates to reach certain monthly sales goals to earn increased commission levels. These can be retroactive, where the increased commission level is applied to the entire month’s sales, or sometimes the higher commission rate is paid on sales beyond the threshold. It is important that marketers establish and communicate the details of a tiered commission structure in advance. Affiliates have to be able to anticipate their marketing ROI.
Commissions should at least be competitive within the industry, and category level commissions can help advertisers normalize product margins. Marketers can communicate their margin goals by offering variable commissions on specific products or lower-margin categories.
Give Affiliates Support
Affiliates need to know a program or promotion exists and that someone is available to work with them. Having a person dedicated to affiliates also makes a program competitive. Whether from the advertiser, the agency’s outsourced program manager or a member of the affiliate network’s account team, contact information for someone who can speak about the affiliate program in detail should be made available. And this point person should be reachable at least during business hours.
Attracting Affiliates Is Only Half the Battle
It’s not enough for affiliates to join a program if their marketing partners do little to help them succeed. Affiliates cannot deliver on marketing goals unless the objectives are shared and the right tools and information are made available.
All affiliate programs operate within their networks’ standard affiliate agreements, which outline payment frequency, regulations and standards for fair practices. But each marketer also can establish special terms and conditions. The terms and conditions are established at the onset of a program and must be effectively communicated to all affiliates. Within the terms and conditions, marketers can establish brand requirements, creative placement criteria, search engine marketing policies and more.
One critical component of any successful affiliate marketing program is a competitive payout. The payout is based on the commission rate, generally the percentage of sales the advertiser is willing to pay affiliates; the commission duration, which is the time period allowed for affiliate traffic to convert into a sale the marketer will credit to the affiliate; and the conversion rate. The payout should make a program attractive to affiliates relative to competitors in the advertising category, while helping the marketer achieve its financial goals.
Some marketers offer a tiered commission structure, encouraging affiliates to reach certain monthly sales goals to earn increased commission levels. These can be retroactive, where the increased commission level is applied to the entire month’s sales, or sometimes the higher commission rate is paid on sales beyond the threshold. It is important that marketers establish and communicate the details of a tiered commission structure in advance. Affiliates have to be able to anticipate their marketing ROI.
Commissions should at least be competitive within the industry, and category level commissions can help advertisers normalize product margins. Marketers can communicate their margin goals by offering variable commissions on specific products or lower-margin categories.
Give Affiliates Support
Affiliates need to know a program or promotion exists and that someone is available to work with them. Having a person dedicated to affiliates also makes a program competitive. Whether from the advertiser, the agency’s outsourced program manager or a member of the affiliate network’s account team, contact information for someone who can speak about the affiliate program in detail should be made available. And this point person should be reachable at least during business hours.
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