Affiliate marketing has become a rage in the digital world. But when you hear about the term “Affiliate Marketing”, what comes to your mind first? The term refers to the promotion of other businesses or products through online platforms and earning commissions as the reward for promotion, with the amount of commission agreed upon prior between the seller and the one who would be parenting to market the products. But an affiliate program is not this easy, let’s see how an affiliate program works.
How Does Affiliate Marketing For Online Store Work?
Normally, it is performance-based and contains four divisions, namely –
- the merchant whose products would be marketed,
- the affiliate who would promote and earn via the sales happening through their promotion,
- the consumer, i.e. you who is buying and using the product, and
- the network which acts as a mediator between the merchant and the affiliate.
Why Choose Affiliate Marketing For Online Store?
Now let’s see why you should choose an affiliate program to grow your business –
- Affiliate marketing doesn’t require an advertising team or the business/ retailer having to create their visuals, rather it falls on the affiliate who would do the marketing to attract consumers.
- Also, the cost would also be lower because the payment would be based on the sales the affiliate would bring in.
How You Can Create a Step-By-Step Affiliate Program
There are some steps that you have to follow if you want to create an affiliate program. The steps are mentioned below –
1. Choosing to Promote Products That Are of High Average Order Value
Your first step will be choosing the products that you’d like to include in your affiliate program. It is better to choose products that a consumer would be attracted by or has a high order value so that it increases revenue along with earnings of affiliate per click. Along with that, some promotional tips like free shipping above a certain amount, offering discounts for the first-time purchaser, or buying and saving more can also be given for enticing. Promotional tips are given to help have better sales for products, leading to better and more sales for the business.
2. Deciding on the Rate of Commission and Affiliate Pricing
After a choice of products that would be promoted, you’d likely be discussing the commission. Mostly cash is given but you can also offer in-store credits or vouchers of the same value, but it’s better if it’s payment based.
There are usually two ways of setting up the rates –
- percentage commission i.e. percentage of each sale via the affiliate.
- flat rate commission i.e. a set amount for a sale made.
3. Choosing an App for the Management of Affiliates
The first step is to install an app that you’d like to use, an app of your choosing. From there, each app has a process that it’ll take you through to get up and running with your affiliate program for your business.
4. Recruitment of Affiliates
After figuring out how to create an affiliate program, you’ll be needing the right kind of affiliates for recruitment for promotion.
Now, let’s see some ways to attract affiliates to join your program,
- Through Social Media: You must announce the affiliate program across social media platforms, to attract more people to join while learning about your business, so that your policy is clear to them.
- Email Marketing: You can tell your subscribers about the program and encourage them to apply and help spread the word to others who might be interested. You can also email influencers or creators via their official mail id if you want to reach out to a specific set of people who you want to be on your program.
- Through Your Website: It’s the affiliate’s job to promote your products but it’s your job to promote your program to reach the targeted number of affiliates you want in your program. You can promote in the footer, creating a landing page dedicated to the program telling about the policies and benefits so that it’s easier to understand the wants you may have from your affiliates.
- Affiliate Sites: You can also join affiliate sites that can give you access to many established affiliates, while also offering training resources to become an affiliate marketing pro.
5. Managing Affiliates
When the recruitment of affiliates is done, you’d want to keep track of the affiliates and how well their management and promotion are going. Regularly communicating via email is essential so that a strong program is established. Make sure that affiliates are familiar with the brand and are following the rules as well as knowing them well. Creating a kind of map with the necessary information will also help keep all the affiliates on the same board. Also, understanding the effectiveness of the affiliate program is very important to survive sustainably. It’s necessary to identify who among the affiliates are among the ones whose marketing is working for you.
What Are the Things You Should Pay Attention to While Creating Affiliate Program?
1. The Total Amount of Affiliate Sales
You must check, what the sales affiliates are bringing and if the sales happening via non-affiliates ( through an advertisement) are more or not.
2. Sales per Affiliate
If there’s not a satisfactory amount of sales per affiliate or an affiliate has not even made a minimum double-digit sale within a month let’s say, you must check what’s going south!
3. Order Sizes on Average, Especially With Sales Happening via Non-Affiliates
You can also look at the average amount of products ordered via the links of the affiliates and keep track.
4. Track the Payments
You should also track whether the payments are being timely as discussed before, this avoids any discontent.
5. Payout to Sale Ratios
You might want to look at what is working for the affiliate’s consumer base and work accordingly. If you feel the value of the sale is not equivalent to the payment, you can also have a word and help them with some tips.
6. Gross Margin Attained
You might also want to look at the profit you have gained after deducting the total and affiliate payment and tally it with the vision you have in mind.
7. The Number of New Affiliates Versus the Number of Old Affiliates and the Affiliates Who Have Said Bye to the Program
These are managed easily by the affiliate management apps which help you with better affiliate management while you look at the other aspects of your business too.
Final Thoughts
Affiliate marketing for an online store if done correctly can save you a lot of time on being creative, save money for creating visuals, and hiring a permanent graphics team, and have a human touch too, getting to know the pros and cons of your business that your affiliates may forward to you or your team to look upon for future development. Affiliate is the way to go and where you can’t go wrong when you do it right.
