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Tips for starting an affiliate program in eCommerce

This is a guest post from Michael Folling. Michael is the founder of Limitless Designs and author of 101 eCommerce Tips. He enjoys building brands and writing about eCommerce. Follow him on Twitter to chat about eCommerce.

Are you looking to lower your customer acquisition costs?

How would you like to have someone else put in the work to drive visitors to your eCommerce store?

With an affiliate program, you can do both of these things.

To help you figure out if an affiliate program is right for your eCommerce business I’m going to discuss:

  • What an affiliate program is
  • How to find affiliates
  • How to track affiliate performance

Read on to learn more about affiliate programs and how you can use this popular marketing channel to grow your eCommerce business.

What Is An Affiliate Program?

An affiliate program is a marketing channel that leverages other marketers or websites that have existing audiences to refer visitors and customers to your brand.

While there’s no single way of managing an affiliate program, there are a few things that all affiliate programs have in common.

First, all affiliate programs have some type of incentive for affiliates to promote their products. This is usually in the form of a commission that affiliates can earn for customer referrals.A percentage of the sale or a flat rate commission are the most common types of incentives for affiliates.

With a percentage commission or flat rate commission affiliates and store owners can easily calculate their return on investment.

Second, affiliate programs usually have an application process for affiliates. This is usually a few questions which help affiliate managers vet potential affiliates to make sure their promotion methods are in-line with the brand’s values and vision.

Lastly, most affiliate programs have a way to track referrals and sales from their affiliates. This can usually be accomplished with a unique referral link and software which tracks those visitors have made a purchase after clicking on that link.

How To Find Affiliates

While setting up an affiliate program is relatively easy with the right software (more on that later), finding affiliates isn’t as easy.

Much like any marketing campaign, you’ll need to find a target audience (in this case it’s people and websites who will promote your products) and market your program to them.

There are two main ways to raise awareness about an affiliate program, you can actively recruit affiliates or you can passively recruit them if your brand is already well known.

1) Passive Recruiting

Passively recruiting affiliates usually involves adding a page to your website where potential affiliates can get more information about your affiliate program.

A successful “Affiliates” page will build excitement about your program to encourage affiliates to apply. It should include information about how much affiliates can earn for each customer they refer, and how often they will get paid.

To encourage potential affiliates to apply you may want to consider including testimonials from existing affiliates and even case studies.

At the very least, I recommend adding a dedicated page on your website where affiliates can apply to join your program. This will help create awareness about your affiliate program among existing customers and marketers who are looking for products to promote to their audiences.

Here’s an example of an affiliate page from the direct-to-consumer brand Bombas:

2) Active Recruiting

Actively recruiting affiliates is much like any other outbound marketing campaign. You’ll need to identify your target audience, in this case people who would be willing to promote your products, and create a campaign to raise awareness about your affiliate program.

Some ways that you could actively recruit affiliates are to do email outreach or network with affiliates at industry events.

The rise of social media influencers also makes it easy to identify potential affiliates. If you have a product that you think would add value to an influencer’s audience, reach out to them and let them know about the benefits of joining your program!

To help you get started on your first outreach campaign, checkout this list of influencer outreach email templates from Ninja Outreach.

How To Track Affiliate Performance

Affiliate marketing is a gigantic industry, so it makes sense that there are a lot of software products out there to support the industry. However, the most important product for getting started is affiliate tracking software.

Affiliate tracking software not only makes it easy to onboard and manage affiliates, but good software also gives your affiliates more transparency so they can feel confident that their efforts will be rewarded.

Depending on what your goals are, there’s probably affiliate tracking software out there that will work for your needs.

If you don’t have a budget for software in the beginning, you can create custom reports in Google Analytics and manually create a tracking URL for your affiliates.

Otherwise there are a whole host of  options out there depending on your situation.

You could use an affiliate network like Commission Junction to help you manage tracking and recruit affiliates, or you could host your own program with a plugin like AffiliateWP if you have a WordPress website.

If you have a Shopify website you could use the Referral Candy Shopify plug-in or if you use Stripe for processing payments and sell subscription products like I do, then you could use Rewardful.

Pricing and features vary greatly for affiliate tracking software so it’s important to do your research to find the solutions that’s best for your eCommerce business.

Conclusion

An affiliate program might not be right for every eCommerce business.

If you have a good idea of what your cost to acquire a customer is and you think that affiliates would be willing to refer customers to you for a commission that’s less than your customer acquisition cost is, then this might be a channel worth looking into.

Starting an affiliate program will present new challenges compared to other marketing campaigns, but if executed properly it can grow to become one of your most lucrative marketing channels.

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