I consider Amazon.com to be the Internet pioneer for
establishing affiliate programs. Their strategy to permit
others to sell their products for a commission on affiliate
websites has single-handedly help them become an Internet
powerhouse and has resulted in Amazon.com becoming a
household name.
As an online business owner, you, too, should be offering
your own affiliate program. Affiliate marketing is so much
less expensive than to take out a banner ad or text ad on
other websites or in email newsletters, and the results
tend to be better. Imagine that you have a staff of people
working for you, and they have agreed to work free of
charge until they successfully make a sale. At that point,
they are paid when their sales reach a predetermined volume
(as outlined in your affiliate agreement) at a certain
interval. You've instantly created a fast and almost free
sales force with very little money.
Even though you may not have the monetary resources
available to Amazon.com, you can create this sales
phenomenon as well for your professional service business.
Here are the steps you need to consider to create your own
affiliate program:
1. Find affiliate tracking software. Trying to manually
track all of the sales of your affiliates is simply too
labor-intensive. Instead, you need to find a software
program that will help you manage your affiliate program.
I recommend the one bundled with my shopping cart,
GetMoreClientsCart.com, which assigns each affiliate a
unique affiliate ID that they can use in their websites to
make referrals back to your website, where the actual sale
occurs. Each affiliate is also assigned a unique log-in and
password so that they can log into their affiliate account
at any time and check on their sales volume. Best of all,
once you've set up your affiliate program, the setup for
each affiliate is completely automated.
2. Determine your level of tiers. Typically an affiliate
program is limited to no more than 2 tiers. After two, it
begins to take on the persona of a pyramid scheme. The
first tier is comprised of the affiliates who are directly
signed up for your affiliate program, and the second tier
are affiliates of your affiliates. For simplicity, I tend
to use the 1-tier affiliate structure.
3. Determine your commission structure and rules. Many
online business owners spend countless hours wringing their
hands over how much to pay in commissions. If you offer too
little, no one is interested in promoting your products and
services because the payoff isn't large enough to motivate
them. If you offer too much, you feel like you're giving
money away. I've discovered that first-tier commission
amounts typically range from 25%-75%, with most in the
35-50% range. Second-tier commissions seem to range
between 10%-30%, with most landing in the 20% range.
You'll also need to determine if you'll pay commissions on
products that people buy for themselves through their
affiliate link. Many people join an affiliate program
solely for that reason. However, if that's the only reason
they've joined your affiliate program, they probably won't
be making additional sales for you.
4. Create your payout schedule. Next you'll need to
determine at what intervals you'll pay your affiliates.
I've seen some programs pay commissions weekly, but monthly
payouts is the most common. Let your affiliates know on
what day you determine the month's commission, what their
minimum earnings must be to get paid (i.e. at least $50 in
earnings, for example), and on what day you send payments.
5. Determine your payment form. For many affiliate
programs to which I belong, I receive a check in the mail
for my payments. However, more companies are transitioning
to PayPal's Mass Pay feature to pay affiliate commissions.
PayPal's Mass Pay feature eliminates most of the paperwork
involved in check writing, and with the upload of a few
files, you can pay your affiliate quickly via their PayPal
email addresses. In order to use this service, you have to
have a PayPal Premier or Business Account and you need to
ask for your affiliate's PayPal email address.
6. Provide marketing assistance. For the greatest success
in your affiliate program, you need to provide your
affiliates with marketing materials to help them promote
yours products and services. Have a graphic designer
create a variety of website banners and buttons they can
use, and you can compose classified ads that they can
place in ezines and sales letters they can use on their
site or as an email marketing tool. You'll need to create
some reminders about ethical email marketing strategies so
that you don't become associated with anyone who is labeled
as a spammer. Lastly, give your affiliates access to a
group of articles that they can use on their site to
promote your programs and services, with directions on how
to insert their affiliate link in the resource box.
7. Educate your affiliates. After joining an affiliate
program, I often receive a phone call from a company's
affiliate manager welcoming me to the affiliate program and
encouraging me to contact him/her with questions. Or, I
get an invitation to special affiliate teleclasses/webinars
to give me strategies on how to be a good affiliate. You
can offer the same amenities to your affiliates by working
with an Online Business Manager/Virtual Assistant to run
this program for you. At a minimum, you can create an
affiliate handbook that your affiliates receive upon
signing up for you program, which will walk them through
the steps of your affiliate program.
8. Market your affiliate program. Once your affiliate
program has been set-up, you'll need to promote it. Have
your OBM/VA seek out strategic alliance opportunities.
Search for websites that permit you to promote your
affiliate program. Send out notice of your affiliate
program to your list, on your blog, and on discussion lists
where this is type of promotion is permitted.
Creating your own affiliate program is a great way for you
to grow your business in a short period of time. You never
know--you may be on your way to creating your own
Amazon.com!
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Online Business Resource Queen (TM) and Online Business
Coach Donna Gunter helps independent service professionals
learn how to automate their businesses, leverage their
expertise on the Internet, and get more clients online. To
claim your FREE gift, TurboCharge Your Online Marketing
Toolkit, visit her site at http://www.OnlineBizU.com . Ask
Donna an Internet Marketing question at
http://www.AskDonnaGunter.com .
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