How to Make Affiliate Marketing Work for Your Online Business
If you run an online business and are new to the game, you probably already know that the “build it and they will come” myth has long been busted.
Whether you sell digital products, run a membership site, or offer your services to those who need them, your website needs customers to make money.
In this article, I’ll talk about the ways affiliate marketing can increase the popularity of your online business.
How to grow your online business with affiliate marketing
Groupon is possibly the best example there is of a site that used affiliate marketing to grow exponentially. The site, according to a Huffington Post article, only had an estimated 150,000 subscribers in December 2009. By the end of 2011, its subscriber base was a whopping 50 million in total.
So how did Groupon do it?
In a Quick Sprout article, Neil Patel described the huge turnaround in two words: affiliate marketing.
- Groupon took the middleman, e.g. the Google Affiliate Network and Commission Junction, out of the equation, so income didn’t have to be shared with them. Affiliate networks often take huge cut from sales revenues.
- Groupon launched its own affiliate network and focused on establishing direct relationships with its affiliates.
Replicating Groupon’s remarkable achievement is an ambition not for the faint of heart, but here are a few things to understand about affiliate marketing:
Finding the right affiliates
We all know that quality trumps quantity any day from Monday to Sunday. You don’t need thousands of affiliates to successfully kick off an affiliate program. In fact, you only need those that make sense, those who would do a good job of spreading the word about your online business.
How exactly do you find these types of affiliates?
- Start with your site. If you have an email list of customers, send them an invitation to your affiliate program. Create banners and post them on your site where they will be optimally visible to your visitors. Or write blog posts about your affiliate program and generously distribute them on social media.
- Participate in affiliate communities. There is nothing like the power of a community. Influential affiliate marketers are generally visible in forums or social media groups that exclusively cater to affiliate marketing.
- Identify high-traffic sites in your niche or industry. Compile a list of relevant sites with a huge following. Then, reach out to them via email and invite them to the program.
- Use different affiliate networks. While time-consuming, trying out several affiliate networks can help you figure out which networks and affiliate marketing types work best for you.
Getting to know your affiliate applicants
It makes more sense to manually approve affiliate applications than to auto-approve them. This allows you to perform due diligence and thoroughly examine the personality types you will be dealing with.
You wouldn’t want to deal with affiliates who will likely only waste your time in the long run.
- Ensure their sites are working properly and that they’re not using questionable tactics to drive traffic to their sites.
- Schedule a Skype or chat session with them and gauge their reaction to questions that matter to you, such as how they intend to promote your product or service.
Treating your affiliates well
Your affiliates expend time and energy, and even put their credibility on the line, to market your products and send customers your way. It’s your job, therefore, to ensure they’re paid well and on time for all their trouble.
Depending on how much you’re willing to spend so affiliates enjoy working with you, you can pay them for web traffic, leads, or actual sales. For products that are reasonably priced, a 25% to 30% commission rate is reasonable. If your offering is on the costly side, 5% to 10% is a fair deal.
And just as important, pay them promptly, according to what was agreed at the get-go. For bulk payments, according to Chexx Inc., employ the services of an affiliate commission payment company.
Identifying your competitive advantage
Know your site’s unique selling proposition (USP), so you know how to position it in the market and effectively focus your sales and marketing efforts.
Here are a few examples of USPs, as cited in this Entrepreneur article:
- Instead of makeup, Revlon sells hope.
- Certain airlines offer a friendly service; others, a service that’s always on time.
- Neiman Marcus is all about luxury.
- Wal-Mart is synonymous to bargains.
- More than the products they offer, Zappos.com is about customer experience.
There has to be something about your website to make it stand out.
Does it cater to high-end products or services? Are the products you offer exclusive to your site alone and not available elsewhere? How have your customers’ experiences with the products purchased from your site been so far?
Making it easy for affiliates to work with you
As a consumer, one of the worst possible experiences is buying something you don’t know how to use, and when you dial customer service for help, all you get is a busy line or a customer service representative who doesn’t sound too happy to assist you.
Chances are you’ll write off that brand or company from your radar forever, and nobody can blame you for doing so.
The same is true for affiliate marketing.
To make it easy for affiliates to work with you, consider the following:
- Communication. Ensure there’s an open communication line between you and your affiliates. This is the first step to fostering good relationships with them. Assure your affiliates that you care about their success, as it brings success to you and your business as well. Always be available to address their questions. Besides email, establish a social media presence. Talk with them on the phone or via chat-based applications about new deals, products, and other offerings.
- Content. Provide as much promotional content as you can to make your affiliates’ jobs easier. These include banners, promotional videos, landing pages, email templates, text ads, product images, and so on.
- Clarity. Be very clear about the terms of your affiliate program – minimum cash amount, when to expect payment, commission rates, and so on.
Affiliate marketing can be a profitable way to promote your online business. But just like all other marketing channels, it takes time and effort before you begin to see any noticeable outcome. And generally, the time and effort you invest into it are directly proportional with the results.
Running an online business is no easy feat. You need to continually spread awareness to attract visitors and eventually turn them into paying customers. One online marketing channel that has proven to be a success is affiliate marketing. Groupon, as an example, grew its customer base through affiliate marketing.
From finding the right affiliates to identifying your competitive advantage, this article lists five affiliate marketing principles to live by and get your online business on the right track.
Reda Sedrati is the founder and CEO of Cloudswave. He works on the general strategy of the company and oversees marketing and sales. He develops the strategic plan to advance the company’s mission and objectives and works to promote revenue, profitability and growth. Some of Reda’s favorite hobbies include boxing and cooking. Follow Reda: Twitter | LinkedIn | Email
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