Affiliate marketing has grown rapidly since its inception and has gained momentum with the growth of social media sites, and the number of blogs and websites owned by individuals. So what is the definition of affiliate marketing? And how to start from the point of view of the advertiser “the producing company”.
Affiliate Marketing Program Definition
It is a results-based marketing channel, in which the company pays a commission (part of the profit) to marketers in exchange for promoting its products and making sales.
It is also an effective marketing strategy in increasing brand awareness at reasonable costs, contributes to building public confidence in the product and leads to increased website traffic, which explains the high demand it is seeing from companies from different fields.
Statistics indicate that the fashion sector is the largest shareholder and pioneer in the field, followed by the sports, health and beauty sectors. The list also includes the travel and household appliances sectors, in addition to publishing, education and finance, retail trade, computers and electronics such as mobile phones and digital games.
The SaaS segment is based on the “subscription” business model; It achieves good results by using it, because the company recovers what it spent in commissions with the growth of sales over time in light of the lower costs of providing the service when compared to the costs of producing physical products.
Parties to the Affiliate Marketing Program Process
the Producing company
Sometimes known as the seller, advertiser, or brand, it is the party that makes the product or provides the service, it may be a large company such as a manufacturer of electrical appliances and it may be a single individual offering an online course.
Anyone, whether he is a single entrepreneur, a startup or a huge company, can be the seller behind the affiliate marketing program, and it is not required that he participate himself in managing the program, but it is enough to have only a product to sell.
Also known as the publisher, again this party could be an individual or an entire company such as recommendations between companies with integrated products (website development company with cyber security company). The affiliate marketer is the party that actually does the marketing, as it promotes one or more products in an attempt to attract the target audience and convince them of the value of the product so that the purchase ends up being completed.
There are different tools that the marketer uses in his work, such as a post to review the product (X), or an entire site specialized in reviewing the products of a sector (for example, the technology sector), or his social accounts on Instagram, Facebook, YouTube, and others.
It is the program’s fuel. Without it, the program’s work system will stop and the balances of revenues and commissions will be zero. The affiliate marketer will try to market to the buyer on the channels he deems appropriate, whether it is social media sites or through a search engine using content marketing on the blog.
The entire buying process may take place without the buyer knowing that he was a part of the process, as the affiliate marketer himself determines that. Some tend to inform the public that they are sharing profits with the producing company as a form of transparency and in order to gain the trust of followers, but others do not let buyers know this.
In any case, the sales tracking system works in the background, as the customer makes the purchase as usual without noticing his presence, the buyer pays the usual price without any visible increase that goes to the marketer’s benefit, while the commission is already included in the base price of the product.
6 Steps to Create Affiliate Marketing Program for Website Owners
If you are a website owner or affiliate marketer, the practice steps for each aspect will be radically different. To learn how to get started as a marketer, you can see this article “Learning Affiliate Marketing”, while we will now talk about the other aspect, which is how to start affiliate marketing Program for website owners:
1- Build a great product and consistent brand
The best way to outperform your competition is to build a great product that solves the problem of a customer who is willing to spend money to buy that solution. The product is the most important factor in the equation of the affiliate marketing program so that it outweighs the value of the commission itself, as it generates more conversions, which means more customers.
The skilled affiliate marketer has made a lot of effort and time to build trust with his audience so that he is achieving high commissions and a good conversion rate, which makes him care about the quality of the product first to maintain this balance of trust before he cares about the value of the commission he will get.
Before launching your affiliate marketing program, you should finish creating a stylish and consistent visual identity for your brand to help marketers properly promote your product or service. Do not forget that customers will go through two stages, the first stage is to learn the product, and the second is to go to the website to make a purchase.
Therefore, it is important to have a coherent brand identity of logo, images, and advertising tone in different platforms so that the brand is easy to recognize and is more refined in the eyes of the audience and buys more smoothly, and when the visitor clicks on the link, he is not surprised by what he sees because of the brand mismatch.
2- Study the competitors
You are not alone in the market, which means it is imperative to take competitors into account, whether to learn from them how to launch the program, commissions and details of the affiliate marketing system, or to make sure that your program is no less powerful than theirs. This means that your CPA is not less than that of your competitors, so that marketers do not turn away from joining your program and instead turn to others.
If the competing business has allocated a large marketing budget to ensure that it is promoted on many relevant websites and marketing channels such as SEO, Pay-per-click ads, product review websites and high commissions, at the same time your small business with a budget cannot With limited marketing to match these practices, the solution is to focus on improving your conversion rate while hiring new affiliate marketers at the start.
3- Determine the objectives of the affiliate marketing program
Before starting the strategy of the affiliate marketing program, the objectives to be achieved should be defined and the frameworks for implementing the strategy should be drawn up. Targets might be to increase sales volume by 6% per year, increase average order value by $6 by the end of the year, or increase the number of active members of the program by 35%.
After setting the goals a strategy will be prepared that includes frameworks such as pay-per-click rules, the way sales will be tracked, and affiliate selection rules. The strategy should also include “Terms and Conditions” explaining how the product is promoted on the Internet, the methods that can be followed, the methods not used in marketing and brand terminology.
To enhance the affiliate marketing program and make the task easier for marketers, it will be useful to create marketing assistance resources before launching the program such as designs, banners and videos to make the task easier for marketers such as the Fiverr Market Strategy for Affiliate Marketing. The strategy may evolve to provide a training course on the affiliate marketing program to deepen the knowledge of the marketers, which represents a beneficial investment for the company and for them.
4- Create your own affiliate marketing program
Affiliate marketing networks provide systems for different businesses to help them in marketing their products so that they act as an intermediary between the advertiser and the marketer, and organize the entire process of payment and billing. Another option in creating the program is to design an affiliate marketing program specifically for the company, which requires some time and the help of a developer but is the most useful and profitable option.
The design of an affiliate marketing program is characterized by saving the cost that commission networks deduct, which may reach 30%. You can also design the program to directly identify the marketers of your products and thus ensure that they have a good understanding of the company’s products and the needs of target customers.
Direct communication with marketers will also allow time-sensitive promotions to be quickly adjusted and notified immediately of new offers. You can design your own program by hiring a professional web developer through an independent platform, the largest Arab platform for freelance work.
5- How to calculate the marketer’s commission
After studying the competitors and getting to know the industry standards in the field of affiliate marketing, you will be able to calculate the commission that the marketer gets. Regardless of the nature of the business that you engage in, there are some important considerations that should be taken into account.
The first consideration is that getting the commission is for purchases only; This means that you do not pay a commission for the number of impressions or clicks on the link. This makes the commission more meaningful and rewarding and is awarded based on results that lead to a real increase in revenue.
The second consideration is that the best way to calculate commission is based on customer retention and CLV with your costs and common sense. For example, the commission is higher in digital products because the cost of copies is little or no, which allows for a higher profit sharing that benefits all of the advertiser and marketer.
6- Find the right affiliate marketers
After completing all the requirements for launching the commission system such as setting the strategy, designing the program and calculating the commission, marketers are not expected to rush to join the program immediately. It takes a few steps to build a list of marketers and prepare them to operate successfully:
- Create a list of potential marketers, whether companies or individuals, whose audience matches the product. It is important to note that attracting a small group of affiliate marketers brings good sales than joining a large group whose audience is different from your target audience and the marketing does not produce actual results.
- The product comparison sites have high credibility, so they are a suitable forum to talk about your product and help the audience to understand the product well, by comparing it with other products without using a direct marketing tone.
- Use tools like SEMRush to find sites with a high DA- Domain Authority, or search on social media platforms for groups that specialize in this type.
- Once the list is created and contact details are collected, send them a message with the goal of getting them to join the program “Hey, we have product(s) with a good conversion rate at Niche that is profitable, and we are willing to pay good commissions on a regular basis. We prefer experienced marketers but everyone is welcome to test achievable results together.”
- Prepare a series of emails (eg 3 messages), to message potential marketers, some may not reply the first time but try again at appropriate intervals.
- Look at your program as a product in itself that needs to be promoted and the affiliate marketers are the customers. Take care of my skills of persuasion and negotiation with marketers during communication and prove to them how they can make profits from it.
- Notice what competitors offer to affiliate members, and offer your affiliate members free products and incentive bonuses.
- Provide marketers with the sponsored materials needed to become your brand ambassadors such as successful videos, review the sponsored content provided by the marketers and give them useful feedback to generate more revenue.
Affiliate marketing is one of the marketing channels that need care, follow-up and improvement. By getting the first sale of your program, this will be the beginning, and you can modify the system details from commissions and others later.