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Affiliate Program
An affiliate marketing program can significantly increase website traffic and business
Although affiliate marketing and referral marketing are by some defined as the same thing, when people think of affiliate scheme characteristics it tends to be highly scalable, potentially creating a large affiliate network, with as many people as possible (affiliates) referring customers to your website (from their website) usually for a small percentage of the sale price.
There is an ongoing cost for affiliate programs (the small percentage of the sale price), however the amount of this percentage is ultimately your decision. The benefit of paying on a 'percentage of the sale price' basis is that this removes risk, you pay for results, you pay when you get a sale, therefore if you get no sales, you don't have to pay any ongoing affiliate fees. Best practice business emphasises the need to mitigate business risk, an affiliate program provides the mechanism to do just that.
So how does it work?
- Affiliates sign up to join your affiliate program, they are given a unique website address (URL), they can also be given pre-designed banner adverts too, which they display on their website.
- When a visitor to the affiliates website clicks on the advert they are directed to your website, at the same time details of this 'click' is recorded by the affiliate software, so you know where this particular lead came from.
- If the visitor buys a product, this is recorded by the affiliate software. Working on your predetermined percentage (or predetermined fixed fee, pay per click, pay per lead, etc. - note: this is entirely customisable to suit your needs) the fee due to the affiliate is recorded. The software can be configured to include fraud prevention measures for additional security.
- After the visitor has purchased the product, the sale fulfilled and at a schedule to suit your needs, the affiliate (referrer) can be compensated in accordance with the incentive scheme agreed by yourself and the affiliate.
The above outlines an example affiliate scheme scenario, however affiliate programs can form a variety of scenarios, leads can be sourced from email newsletters, newsgroups, third party adverts, intranets (the list is endless). Marketing using affiliate programs is completely customisable, and although you do have to pay something, you pay for results. Don't forget:
- Pay affiliate fees only when they make you a sale
- No cost for salespeople
- No cost for advertising (the affiliates advertise for you)
- Low set-up costs
- Low risk
- Brand recognition increased exponentially
- Effective advertising from third party recommendations
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