Member Article

Launching an Affiliate Program for Your eCommerce Site

Too many online retailers run by the principle “if you build it, they will come.” The sad reality is that customers won’t come to your website, simply because you have great products. You need to market your site heavily, which can be difficult if you have very little money for advertising.

This is one of the reasons affiliate marketing is so popular in the ecommerce industry. If you don’t have the budget to run your own AdWords, SEO or Facebook advertising campaigns, then you may want to consider starting your own affiliate program.

Affiliate marketing is one of the most cost-effective ways to generate sales for ecommerce. According to Rakuten Marketing, the affiliate marketing industry is expected to grow over $5 billion over the next five years, largely because so many new ecommerce companies are looking for low cost ways to scale their businesses.

Benefits of Affiliate Marketing

Generating targeted traffic is one of the hardest aspects of running an ecommerce site. It can be difficult to generate that traffic on your own, especially if you are a new site with a limited budget. Here are a few benefits of affiliate marketing.

Only Pay for Sales

Running campaigns on AdWords is always risky. You can spend a thousand dollars testing traffic without generating a single sale. It can cost even more to finally find profitable keyword, ad and landing page combinations.

You don’t face the same risk by creating an affiliate marketing program. You only pay your affiliates when they actually generate sales. This eliminates a lot of the risk.

Expand Your Brand Image

Establishing a strong brand image needs to be one of your long-term goals. It’s easier to establish a strong brand image with the support of a number of affiliates.

Starting an Affiliate Program for Your Ecommerce Site

While launching an affiliate program is a great way to scale your ecommerce business, it isn’t a foolproof strategy. You need to implement it carefully to generate a steady volume of sales without damaging your brand. Follow these guidelines before launching an affiliate program.

Establish Ground Rules

Before you accept any affiliates or join an affiliate marketing network, it’s important to establish a set of rules that all affiliates must follow. Without these rules in place, you may be jeopardizing your brand or cannibalizing your own traffic. Here are some common rules most ecommerce sites set in place:

• Affiliates aren’t allowed to bid on brand keywords. If you are planning on running your own campaigns on Adwords, Propel Media, Advertise.com, Bing or other advertising networks, then you will probably want to bid on keywords related to your brand and your competitors brands. You don’t want to compete with your own affiliates, because you will get less traffic and have to pay higher CPCs.
• All landing pages, banners and other creatives must be approved by your compliance team. This is important to ensure you have a high lead quality and you don’t get penalized for violating any FTC policies or other advertising laws.
• Certain traffic sources are prohibited. This is particularly important if you are paying affiliates for leads rather than sales, because leads from sources aren’t high quality and rarely convert into paying customers.
• Any refunds will be deducted from the commissions of the affiliates that generated them.

Make sure affiliates know that they will be removed from the offer if they don’t follow these guidelines.

Choose a Good CPA Network

Some brands manage their own affiliate programs, but most choose to go through a CPA network like ShareASale, MaxBounty or CJ Affiliate (formerly Commission Junction). The good thing about using an affiliate network is that they monitor affiliates carefully. They make sure they aren’t defrauding you or doing anything that could damage your brand image.

Monitor Lead Quality Carefully

If you are paying affiliates for leads instead of sales, then you need to monitor their traffic quality carefully. Make sure that their traffic converts to sales. If it doesn’t, you need to ask your network to pull the affiliate from the offer, because they are costing you money for useless leads.

This was posted in Bdaily's Members' News section by Ryan Kh .