Internet Marketing Tools – Setting Up an Affiliate Program
Posted on June 27, 2009 - Filed Under Internet and Businesses Online | Leave a Comment
Setting up an affiliate program so that other people can promote your products is one of the best internet marketing tools you can take advantage of. There are a few things that you really have to keep in mind when you are setting up your affiliate program...and things that you want to avoid doing. Really, setting up an affiliate program is about a business philosophy!
Think of an affiliate program as a vehicle that you can use in order to obtain joint venture partners. I've found that with joint ventures there is a lot less work going into it...and a lot less money too. And I get higher conversions and typically better customers...I mean customers who are going to stick around and buy more from me over the long-run.
Now, it's only a partial vehicle, and the reason I think it's only a partial vehicle is because you need to have a product that converts well, right? You need to have a reason somebody might want to promote you. There is an exchange...and even exchange...when you are creating a successful joint venture. The person who is promoting your product or service is getting money typically, right? And you are getting traffic in exchange. That is what an affiliate program allows you to do. Exchange traffic for money.
One of the things about an affiliate program that everybody should be clear on is that if you set it up right...and it's not hard to set up...then the program does all the calculations for you. An affiliate program gives your affiliates the necessary personalized links to make sure they get credit when they refer a customer to you. When that referral becomes a buying customer they get the credit...they get their commission.
That being said, there are a few things that people can really bang their heads up against the wall when it comes to affiliate programs...a few things to definitely avoid doing.
Don't look at the little picture-don't get greedy! If the industry standard is to give 50% commission then don't get cheap and decide to only give 15-20%...you might make more money in the short-run, but you want to think long-term. I'd rather see you give away more up front and take advantage of big, big traffic from happy affiliates.
Don't forget the back end-have a follow up product to promote to your customers. It might be a continuity program or an upsell or other products in the niche...it can even be products from other people that you are recommending. Remember, it is much cheaper for you to sell an existing customer on additional products than it is to acquire a brand new customer. On your back end sales you might offer less commission to your affiliates...or maybe no commission at all.
Don't go in blind -know what your numbers are. How much does it cost you to acquire a customer, to sell a new product to an existing customer...those sorts of things. What percentage of your existing customers buy additional products from you-yours or products you recommend. Knowing these numbers will really help you determine how much commission you can give to your affiliates.
Understanding the philosophy behind setting up an affiliate program with really help you to use these awesome internet marketing tools. When you do it right, you can make money now and in the future and have great traffic and happy affiliate.
Tellman Knudson is CEO of Overcome Everything. He and his team at The Listbuilding Club are passionate about teaching others the ins and outs of list building and other internet marketing tools, tips and strategies. To learn more from Tellman and the team, visit http://ListSpeed.com/
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