What is Affiliate Marketing?
Firstly, we will answer the question, what exactly is affiliate marketing? Then we will help you understand how you can increase your businesses sales through this modern marketing strategy.
Affiliate marketing works on the basis of hiring ‘affiliates’ that are paid to bring you more customers. But, instead of paying these individuals or businesses for driving traffic to your company’s website, you only pay them when a purchase is made from said customer.
Audio 9.37 Minutes
— Affiliate Marketing
effective affiliate marketing system
What aspects do you need to create an effective affiliate marketing system?
Several key aspects are needed in order to ensure your affiliate marketing program will be successful, these include: the merchant; the affiliate; the consumer and the network. Here we will explore these success factors in more detail.
The Merchant: this typically refers to the brand or seller who has developed or owns your product or service. In an affiliate marketing system, anyone can be the merchant, from SMEs to Fortune 500 companies.
The Affiliate: this role is sometimes referred to as the publisher. This role again can be either an individual or an entire company. The job of the affiliate is to gain and convince leads to become paying customers of the merchants products or services.
The Consumer: this is the role of the person doing the buying. If there are no consumers, then there are no sales, which in turn means no revenue. It is the role of the affiliate to attract the attention of the consumer through methods such as blogs or social media.
The Network: a lesser known aspect of the affiliate marketing system is the network. This role acts as an intermediary between the affiliate and the merchant, by handling the payment and product delivery. There will also be a range of products hosted by the network to allow the affiliate to select which products or services suit them best.
Affiliate marketing systems 101
We hope now the basic principles of affiliate marketing systems are a little clearer for you and your business. We have listed some facts and figures below which help highlight the benefits of affiliate marketing programs.
- What % of brands gain potential customer attention and engage existing customers generating more sales through affiliate marketing? 81%
- What % growth rate is expected of affiliate marketing throughout 2020? 10%
- What % of marketers drive increased visibility, conversions and purchases through some form of affiliate marketing? 79%
- What % of marketers use affiliate marketing to increase brand awareness? 83%
- What % of marketers use affiliate marketing to engage existing customers with new content and products? 79%
- By how many billion $’ is the value of affiliate marketing expected to rise by throughout 2020? $6.82 billion
leverage an affiliate marketing system
How to leverage an affiliate marketing system to your businesses advantage.
We hope now you have understood what affiliate marketing is and the benefits it can provide to your business, now and in the future. Following this, we will explain 5 quick wins in affiliate marketing that will help you get step up and increase your affiliate sales as soon as possible.
Top 5 tips:
Connect the dots for your customer
By this we mean creating an ‘in between’ such as a blog post or multimedia content that’s sole purpose is to answer your customers questions. By solving a consumer problem in this valuable piece of content, it can help encourage the customer to take the next step and purchase a product.
Reviewing the product yourself
You can always buy the product yourself and promote it in order to attract a new audience of potential customers. With this, your business could promote the item with a behind the scenes, particularly if the product is informational.
Compare your product to a similar product
This quick win works best if you are an affiliate for both products, but can still work if you’re only an affiliate for one, comparing the item to a market leader for example.
Providing bonuses when a product is purchased
By providing incentives for individuals to purchase your product over others can be as simple as an additional 30 minute webinar. Or, you could provide the buyer with access to blog content or podcasts which you would typically charge for.
Building a wide audience network
This factor is arguably the most important and should not be overlooked. You should regard your businesses as you and your consumers, not you and your affiliate products. By not retaining any of these consumers your business could be losing valuable traffic that should be amongst your audience network.
Your business should work hard on its relationships with your audience. Firstly, focus on building an organic list of customers loyal to your brand, then secondly think of expanding this affiliate purchase. If an audience member doesn’t purchase your product today, whilst they are in your network they could always make this purchase further down the line. If they’re not in your audience network, you will miss out on this opportunity and additional revenue.
These ‘quick’ methods can be very useful in getting your successful affiliate marketing system off the ground to begin increasing sales. However, to secure the longevity of this program it is important to look into additional factors with a deep dive. Here we will look into more long term methods to ensure this strategy’s success.
Deep dive into more important methods of affiliate marketing
Here are the 7 most important factors in creating a successful long term affiliate marketing system.
Incentivise affiliates through discounts
Make it clear to each affiliate that exclusive discounts are on offer. Discount coupons have been well known to improve conversions for both traditional and unique websites. This method helps build loyalty to the affiliate directly.
We would suggest using this method to help re-engage accounts that have been dormant, in addition to those wanting to increase incremental sales leads.
Provide each affiliate with tools and marketing materials
Website promoting tools are useful to affiliates as they can boost traffic and conversions, in turn increasing sales. AdWords and Facebook are the most commonly used methods but SEO or email marketing services should also be considered depending on the brand.
We would suggest using this method to help recruit new affiliates and in turn keep their loyalty. This method is also crucial in increasing incremental sales leads.
Content creation for affiliates
Content is often a neglected resource in terms of affiliate marketing. Both pre-created content in addition to the support necessary for each affiliate to generate content themselves based on your businesses products or services. Content resources such as these could include product reviews, technical information that is not public knowledge providing exclusivity to the affiliate as well as high resolution marketing material and templates.
We would suggest using this method to help maintain engagement with affiliates and well as reenaging previous affiliates. This method is also key in driving sales.
— Affiliate Marketing
important methods of affiliate marketing
The use of your brand logo and trademarks
This approach should be used with caution but a fantastic way to engage your top performers is to allow them the use of your branding throughout sponsored ads. This will work only for some products and certain countries so consider where this extremely beneficial method is best placed.
We would suggest using this method to help your top performers remain engaged in the brand and boost incremental sales.
Carefully consider your commission rate
One way to ensure each affiliate is consistently engaged is to increase commission as a short term initiative. This is most popular in industries with advertisers that have standard commission rates or in highly competitive markets.
We would suggest using this method to help recruit new affiliates and re-establish a relationship with underperforming or inactive affiliates.
Bonuses based on performance or actions
A bonus scheme for affiliates that increase sales the most can benefit the affiliate-merchant relationship strongly. If an affiliate hits a certain level of sales you can reward them with a pre-agreed bonus. This benefits both parties as the affiliate is more motivated therefore selling more products to reach their bonus whilst the merchant is paying a small ‘incentive fee’ to guarantee maximum sales through affiliate marketing.
Fixed bonuses for reaching a certain number of sales or new recruits is also a great way to incentivise your affiliates. In addition to this, it would not be uncommon to give top performers higher rates of commissions once agreed sales thresholds are met.
We would suggest using this method to help engage top performers and existing affiliates in addition to driving incremental sales.
Holding sales focused contests or competitions
One of the most effective ways to incentivise affiliates is through a sales based competition. The crux of a successful affiliate contest is one that engages top performers as well as smaller and newer affiliates. By making a competition accessible for each affiliate you can expect to generate better results and increase sales.
We would suggest using this method to help incentivise and re-engage inactive affiliates as well as boosting sales.
Throughout this page we have discussed over more than 12 ways to increase sales through affiliate marketing for your business. If you don’t take away anything else it is important to remember to motivate each and every affiliate throughout the entire program. In addition to this, your business should be paying special attention to the results you want to achieve through this affiliate system to ensure targets are being met.
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