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Running an Affiliate Program: How to Choose Your Commission

December 31st, 2009 by admin | No Comments | Filed in Affiliate Marketing

Running an Affiliate Program: How to Choose Your Commission Levels

If you use the internet to sell products or services, you may be interested in starting an affiliate program. With these programs, you rely on the use of website affiliates. They are also known as online agents. These individuals will use links and banners to advertise your products or services. Each has a special tracking code. That enables you to tell which affiliates helped you generate sales. Those affiliates are paid a commission for doing so.

In terms of affiliate programs, payments are made to affiliates a number of different ways. The most common is a preset set commission percentage. For example, if an affiliate has a 5% commission rate and they sell a $600 television set, they earn $30. On the other hand, flat commission rates mean the affiliate earns the same amount of money, regardless of a purchase. For example, an affiliate can earn $5 on the sale of a DVD, magazine subscription, or television set.

When determining how you should pay your affiliates and how much, there are a number of factors you should consider. What are they?

The number of products you have available for sale. If you are only selling one product, like a how-to eBook, it is best to opt for a flat commission rate. Your eBook sells for the same price, like $19.99. In this aspect, flat commission rates are ideal, as your affiliates know, upfront, how much they will make from each sale. If they sell a copy of your eBook, they automatically know they made $3 or whatever your commission rate is.

If you are selling a large number of products, like if you run an online store and provide generalized links to that store, use your best judgment. An affiliate can make good money by selling a flat screen television with a 5% commission, but may barely get pennies if they help sell a DVD. In this case, many affiliate program managers have specific commission percentages for each product category, like movies and books, toys, electronics, and so forth. With this approach, you ensure your affiliates get paid a fair percentage, but that you make money too.

If you are selling a service, it depends on the type of packages available. For example, if you are selling your writing services, you will get varying requests. One client may ask you to write an 800-word article and another client may ask for one hundred 300-word articles. In this aspect, commission based on percentage is best. You will not lose money if a referred client only wants a $15 project.

Finally, it is important to consider the average selling price of your products. If you run a specialty store, such as handmade childrens clothes, most of your products are similar in price. You can easily charge a flat rate commission and not lose money yourself. It is with a mixture of cheaper and expensive products be careful. Always think about the bottom line. Consider the cost of materials or purchasing wholesale, shipping, and other expenses. Make sure that when you add in the money paid to affiliates, you are still making a profit. Remember, affiliate programs should help you generate sales and income, not lose it.

When determining commission, you want to make money. You also want to provide affiliates with enough income to justify their hard work. For that reason, provide a solid commission. What you need to remember, as a product or service seller, is repeat customers. The purchase is made through your website; your affiliate just links them. Your customer orders and pays for their purchases on your website. They will remember this website and head directly there next time. Rarely are second purchases made through affiliate websites. Consider this onetime payoff worth it in the end. Affiliates help to generate interest and sales, but it is up to you to have a good product, good customer service, and affordable prices to generate repeat sales.

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Reward Your Affiliates with These Great Bonuses

December 30th, 2009 by admin | No Comments | Filed in Affiliate Marketing

If you run an affiliate program, you want your affiliates to do well. The more links there are going back to your website and the more clicks those links receive, the more sales you get. You rely on your affiliates to generate interest and sales. Unfortunately, not everyone puts forth the same effort. That is why bonuses are a great idea. When properly implemented, bonuses for affiliates can reward your top performers and motivate your underperformers to improve.

As previously stated, bonuses provide a source of motivation for all affiliates. They also reward your top earnings. This is very important. Just because an affiliate applies to your program and you give them access to coded banners and links, it does not mean they will use them. Many affiliate program members are technically active, but actually inactive. You dont necessarily want to give up hope on these individuals, as they can make both you and them money, but they need motivation. That motivation can come from additional compensation earned as a bonus.

As for why it is important to reward your top performing affiliates with bonuses, you want them to stay happy. These individuals generate the most sales for you. Overtime, they will expect some type of increase, like permanent commission increases. If you dont want to take this big step, a year-end bonus may keep your affiliates satisfied. Remember, your top performers are not people you want to lose. If they leave the program, they take the sales they generate right along with them.

Now that you know the importance of rewarding your affiliates with bonuses, what type of bonuses can you offer? This is what is great, anything. You are in control. If you are looking for a few sample ideas, please continue reading on.

A year-end bonus. As previously stated, year-end bonuses can keep top performing affiliates held over. They would likely prefer a set commission increase, but at least they get extra money. If you opt for a year-end bonus, base your decision on performance. Do not give everyone a bonus or the same amount. For example, dont give your inactive members a bonus if they dont have any links to your website. Do not give an underperforming a $500 year-end bonus if they havent generated more than $200 in sales. Ensure your bonuses are enough to keep your affiliates happy, but that you dont lose money too.

An increase in commissions. Although most individuals would consider an increase in commission a pay raise, it can fall into the category of bonuses. Once again, you want to use affiliate bonuses to motivate your underperformers and keep your top earners happy. For that reason, set a specific level in which commission will be raised. For example, an affiliates commission can increase to 4% once they reach $2,000 in sales. Next, that rate can increase to 5% once they reach $4,000 in sales, and so forth.

A temporary increase in commissions. If your main goal is to motivate your affiliates to try harder, a temporary commission increase is best. This just may get those individuals who have yet to place links to do so. Since these types of bonuses are only temporary, make it worth it. Instead of raising your affiliates commission only 1% during the month of December opt for a 2 or 3% increase. Yes, you have to payout more, but it is only temporary and only when sales result.

In short, bonuses serve as motivation for underperforming affiliates and a reward for your top performers. If you operate an affiliate program and have yet to dispense bonuses, try it.

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How to Provide Your Affiliates With Support Along the Way

December 29th, 2009 by admin | No Comments | Filed in Affiliate Marketing

How to Provide Your Affiliates With Support Along the Way

If you run an internet business and have an affiliate program, it is important to devote a lot of time and energy into that program. For internet retailers, their affiliate programs are the backbone of their company. It is these individuals and their websites that spread the word. They advertise for your company and generate sales. For that reason, you should be available to provide support and help along the way.

As important as it is to know that you, as a seller operating an affiliate program, should be available for helpful support, you may wonder why. Why is this help so important and how do you offer it? If these are questions you have, please continue reading on for the answers.

If you do not provide your affiliates with help and support along the way, you may find them dropping like flies. It is a known fact that people are unhappy when they cant get the answers they want or need. You do not want to lose good or potentially good affiliates this way. Always make sure someone on your staff, whether it be you or another member, is available to find help through email or over-the-phone.

As previously stated, a lack of help and support may cause some affiliates to leave. Dont expect all internet users to know how your companys affiliate program works, how to get links, and so forth. There are many functioning affiliate programs online and they all operate in different manners. It is always important to be available for questions or complaints, but you can limit that frequency by properly training your affiliates and having how-to information available on your website. Have step-by-step guides with screenshots and a list of proven tips to get your affiliates started. When they have access to this information upfront, they are likely to ask fewer questions later.

It is also important to remember that help comes in a number of different formats. If an affiliate approaches you for help, they may not have a problem using your program. What they may have is a problem with is the sales page templates and banners available for use. You may not have their needed size or a sales page style that fit their needs. They may provide helpful suggestions, such as expanding the uploads. Of course, you dont have to take these suggestions and implement them, but give it some thought. It if can benefit one affiliate, but might help them all.

Most importantly, providing your affiliates with help and support along the way should improve your affiliate program as a whole. Your affiliates do not have any confusion. There are no mistakes with their links or banners on your page. They are not breaking the rules. This benefits everyone involved. They help to legitimately and correctly generate sales and you get profits from those sales. In addition, since your affiliates always know they can turn to you to resolve a complaint, offer assistance, or accept suggestions, they are more likely to put forth extra work and effort.

As previously stated, there are many ways to provide your affiliates with help and support. In addition to having over-the-phone training sessions with new affiliates or step-by-step guides with screenshots available for viewing, have a dedicated email address setup just for your affiliate program. Ensure someone in your company is able to check this email at least four times a day.

Where you will run into problems is at night. You may work traditional business hours, but most affiliates dont. In fact, some use affiliate programs as a way to supplement their full-time income, meaning they work late at night. Waiting 24 hours to receive a response is normal, but why not start an online forum for your members? They can provide each other with technical support, internet marketing help, and other tips. In fact, if you have top performing affiliates who consistently bring in sales, get them to volunteer their time or provide small compensation for them to be active in the forum. They can share their money making does and donts with others.

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