Is Your Small Business Ready For An Affiliate Marketing Program?

Posted by Admin on August 8, 2013
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 Affiliate Marketing or Performance Marketing is a very cost effective sales strategy for SMB’s.  Basically it’s offering a commission to a partner called an “affiliate” when they generate a conversion, like a lead or sale.  However, not all products or services are suitable, so let’s find out which ones work and how to  create a successful small business affiliate marketing campaign.


What works best on a CPA?

  • Digital products like eBooks
  • Downloadable mobile apps
  • Leads for a value oriented service
  • Subscription models like monthly beauty/makeup (Ex. Birch Box) or food boxes (Ex. Healthy Surprise)
  • If you have a multiple product line through an e-tail store

Getting these types of offers to work are more challenging:

  • If you only offer a single product
  • If you serve one city or region
  • Extremely niche products
  • Low margins
  • Very low conversion rate (<2%)

What group does your product or service fall under?  If you have an offer that is more challenging, don’t rule out affiliate marketing entirely.  You can always revisit it in a few months as you scale your business or setup a simpler referral program (discussed below).

How to incorporate affiliate marketing into your Small Business…

Setting up your program:

First you have to determine whether to do it yourself and keep your program in-house or outsource to an affiliate network.   I won’t go into details about the pros and cons as every business has their own needs, goals and budgets but here’s a good infograph to compare the two.

Unless you are already an online marketer with experience and solid connections to recruit affiliates, I personally recommend outsourcing because managing an affiliate program is very time consuming, never mind having to worry about fraud and malicious advertising practices.  Leave it to the specialists so you can focus on the other million things you have on your plate.

Not all Affiliate Networks are created equal so shop around!  Bigger doesn’t also mean better.  I often find the boutique agencies to have more efficient customer service and more dedicated account managers.  Unless your offer is very unique and compelling, it can be a challenge to generating significant volume.  It’s easy  to get forgotten with hundreds of other programs competing for attention on the big networks like CJ and Linkshare.

Referral Programs:        

Existing customers make the greatest ambassadors because they already know your brand and have built a relationship with you.  Encourage them to email the offer to their friends (a good time to do this is during the checkout process), post a banner or link on their blog or share on social media.  Show your appreciation by offering a bonus or discount off their next purchase if a successful referral is made.

Cash is king but if you are bootstrapped, try offering incentives like credits.  For example, if you have a subscription business like an organic grocery box, you can make a referral and get $10 off your next purchase or exchange for product such as, get the next month’s box free.

Bloggers have a network of loyal followers.  If you offer something of value, many bloggers will be happy to do a review for a small payout or for the product.


Don’t forget to offer  your affiliates the tools to help them promote like templated emails and banners in different sizes.  Give time limited coupon codes to help them promote.

What To Payout?

It can vary wildly depending on the program.  Most affiliates will be looking at the payout, along with the conversion rate and comparing you to competitors.  Higher volume products tend to command lower rates.  What’s the most important factor for PPC (pay per click) affiliates is EPC  (earnings per click).  With this metric, you can measure the efficiency of an advertiser’s program and the potential revenue an advertiser may generate for you, on a level playing field.

Click here for more info on EPC.

Your payouts will also have to remain competitive if you want to attract quality affiliates so check out what your competition is doing and what their commission rates are.

Don’t Forget To Track!

A good reporting tool is necessary to monitor your affiliates’ activities and results.  If you chose to outsource your program, then the network will give you access to their tracking platform.  If you decide to manage your program in-house, I suggest using HasOffers (you can try them out for free for 30 days).

Forrester Research projects that U.S. spending on affiliate marketing will reach $4.1 billion in 2014, up from $1.6 billion in 2007 so despite what the naysayers say, affiliate marketing is growing and will eventually outpace digital marketing spend! Here are 5 things you don’t know (but will now) about the industry.

Use Competitive Intelligence..

Take advantage of our display and mobile tools to help you gain the edge in any competitive niche, discover new traffic sources, get ideas for banner/text creative and much more!

If you don’t make money right away don’t assume that affiliate marketing doesn’t work for your business.  Many programs take a while to show any results, so you have to be patient and persistence. The operative word for a good affiliate network is “sustainability.”  You will want to attract good quality affiliates who can help you grow your business and your brand.




Topics: Performance Marketing, Affiliate Marketing, Small Business, Startups


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