Affiliate marketing, a marketing program that compensates affiliate third parties for defined actions such as generating leads or sales, can be an amazingly powerful tool for online retailers to increase awareness, reach, and sales on a performance basis. There are a number of companies (affiliate marketing networks) that can help you implement an affiliate program, but there are also a number of reasons why you might want to build your own homegrown affiliate program. One of the biggest reasons to do it yourself is to maintain authenticity. If you create your own program, you build the relationships, set the tone, and have a voice in the process.
Beyond just growing sales, an in-house affiliate marketing program, if done correctly, can help grow a social presence, foster community engagement, increase credibility, provide search engine benefits, and build a brand.
At KontrolFreek, we started our affiliate program with just a few authentic fans of our video game accessories products that had huge followings online through their blogs or video channels on YouTube. In four short years, the affiliate program is now directly responsible for more than 30 percent of our online sales. That's a huge number of sales that would be left sitting on the table if we hadn't created this referral program that allows us to connect with our desired audience.
Here are the areas to consider when deciding if creating and building your own affiliate program is right for you:
Determine if your business is right for an affiliate program
Do you have a niche market or product that can be easily purchased online? Is your product something that can easily be marketed by others? Do you have competitors? What are they doing?
Define the program
Once you have determined that your program is a good fit for an affiliate program, you will need to define the program. What are the terms and conditions? What are the incentives and commissions? How much can you afford to pay per sale or conversion and what's an adequate incentive? Can you afford to pay a 5 percent commission on sales? What about 10 percent? Do these things align? Your offer should be compelling for you and your affiliate partner. Are there tiers or opportunity for upward mobility? What do your prospective affiliates look like?
You will need to identify and reach out to potential affiliate partners who see value in your offer and who already have an audience that aligns with your product. Target partners could be influential bloggers, a popular website, or a business with a large email list. In the best-case scenario your partners will authentically see value in your product and can personally stand behind it. If the partner is an influencer, their personal testimonial can really help with credibility and sales performance.
This is an ongoing exercise. No matter how big or successful your program becomes, you have to continue to infuse it with new partners who have access to new audience to account for the churn in partners and audiences.
Otherwise, sales will become stagnant as you mine the same audiences and partners drop out or burnout. As your products and program become more visible, you might consider creating an inbound partner request form on your website to let your website visitors know that you have an affiliate program and are always interested in meeting potential partners.
You will need to set up a tracking system so you can see how much traffic and sales your partners are generating. There are a number of software programs, such as Post Affiliate Pro or HitPath, that can easily track visits, sales, and clicks generated by affiliates.
Regularly share information about new products, discounts, contests, and best practices that can be used in promotions and seek to build relationships with your best performers. Solicit feedback on what's working and what can be improved and remember to take care of your best performers. They can make or break your program.
Equip your partners for success
Make it easy for your partners by providing them with compelling creative and promotional material (banner ads, emails, videos). The less work they have to do and the more conversions they see, the more likely they are to promote your program.
Develop assets affiliates can use for promotion (images, videos, etc). Pay them on time. Consider contests and additional incentives to keep them motivated.
A successful affiliate program takes time and effort, but it has the ability to increase your sales noticeably and build a community around your company.
On Twitter? Follow iMedia Connection at @iMediaTweet.