Getting Started with Affiliate Marketing

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    18-Oct-2014

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Have you ever thought about giving other people a commission for generating sales or leads for you? This is called affiliate marketing, and you can take advantage of this up-and-coming marketing channel to boost sales or leads while lowering your risk. Not only do affiliate marketing programs help free up your time (since others create and run the advertisements), but it also helps shift the risk away from you since you only pay when a successful sale is made or a lead is generated. The following presentation will teach you the basics of affiliate marketing including what it is, the basic elements of running a successful affiliate program and what you can do to get started right away. As a bonus, we’ll also detail some ideas you can use to create a new revenue stream for your business by promoting others’ products yourself!

Transcript

Slide 1 Formic Media Seminar Series: Affiliate Marketing Hosted by: Formic Media, Inc. www.FormicMedia.com John McPhee | johnm@formicmedia.com Sponsored by: Spool Video www.FormicMedia.com Brian Schatz| brian@spoolvideo.com Formic Background  Launched in 2008 to service small business & partners  Incubated by Anvil Media, enterprise SEM agency  Provide SEO/SEM, social media & web development services  Focus on education (monthly Seminar Series)  7 employees  45+ active clients Affiliate Marketing August 2011 Provided by Anvil Media Inc. ©2011—All Information in This Document is Copyright Protected and the Property of Anvil Media Inc. Nick Herinckx Senior Account Executive 503.595.6050x233 nick@anvilmediainc.com Anvil Media, Inc. Nick Herinckx – Senior Account Executive • 3 years at Anvil Media • Responsible for most Anvil B2B PPC & SEO case studies • Manages own network of affiliate sites in free time • Published in AboutUs.org & PPC Insider • Technical background in website code & development • Grew Borders’ affiliate program 34% year-over year at 1,400% ROI Overview 1. What is Affiliate Marketing? 2. Types of Affiliate Programs 3. How Does it Work? 4. Starting & Running a Successful Program 5. Types of Publisher Business Models 6. How to Become an Affiliate Yourself What is Affiliate Marketing? Affiliate marketing is paying someone else to generate business for you online, where you only pay for performance. Definition Section: What is Affiliate Marketing? Publisher (the affiliate) • Promotes your company for you • Often owns a related website, email list or has money to test on advertising • Gets paid only when they accomplish a sale, lead or other action you outline Advertiser (the brand) • Wants leads/sales • May not have a big budget or time to devote to marketing • May simply want more exposure on other affiliates’ sites • Pays a fixed amount or a percentage of a sale to the affiliate only when a sale is made or lead is generated Publisher vs. Advertiser Section: What is Affiliate Marketing? • Amazon invented the concept of affiliate marketing online. History Section: What is Affiliate Marketing? • Affiliate marketing spending is expected to reach $4 billion in 2016 (Marketing Sherpa) • Some top brands are affiliate marketers: History Section: What is Affiliate Marketing? • Risk is almost all on the publisher/affiliate • Only pay for results • No need to be an expert marketer, the affiliate does all the “creative” marketing • Ability to gain visibility on some of the Internet’s top websites Benefits of an Affiliate Program Section: What is Affiliate Marketing? • Must promote program when starting • Must police affiliates to ensure they’re following your rules • Some up-front financial investment • Must communicate with affiliates • Some technical implementation required • Build up over time, not a quick fix Challenges of an Affiliate Program Section: What is Affiliate Marketing? Types of Affiliate Programs You pay for leads generated, typically a fixed cost up front plus another sum if lead turns into a sale later on. Cost per Lead (CPL) Section: Types of Affiliate Programs Cost per Lead (CPL) Section: Types of Affiliate Programs Payout: • $10/lead • $700% for sale Cost per Lead (CPL) Section: Types of Affiliate Programs • You pay only for sales generated, typically a % of the order total. Cost per Sale (CPS) Section: Types of Affiliate Programs Cost per Sale (CPS) Section: Types of Affiliate Programs Payout: • 7% of sale You only pay for a specific action taken, typically a flat amount. Cost per Action (CPA) Section: Types of Affiliate Programs Cost per Action (CPA) Section: Types of Affiliate Programs Payout: • $1 per download How Does Affiliate Marketing Work? • Based on links • Each affiliate gets their own unique links • When a sale is made, the system can tell which affiliate referred the sale because the unique link that was used is tied back to the affiliate The Tracking Process Section: How Does Affiliate Marketing Work? The Tracking Process Section: How Does Affiliate Marketing Work? • Just like if you put a unique phone number on each business card you handed out • Which business card drove a call? Just look at the unique phone number! Affiliate Systems Section: How Does Affiliate Marketing Work? • Once you install an affiliate system, the whole tracking and payment calculations happen automatically. Affiliate Software Choices Section: How Does Affiliate Marketing Work? Affiliate Network 3rd party/intermediary between advertisers and affiliates. Self-Managed Software Easy-to-use software that provides all the tracking/technology to run your own program. Affiliates Network Advertisers Affiliates Advertiser Affiliate Software Choices - Pros Section: How Does Affiliate Marketing Work? Affiliate Network  Immediate access to thousands of affiliates  They manage affiliate relationships Don’t worry about individual affiliate payments yourself  Built-in communication tools Management team provided to you (for extra cost). Other services provided (for extra cost) Software Much less expensive Much better for SEO/increasing site rankings  Complete branding control Affiliate Software Choices - Cons Section: How Does Affiliate Marketing Work? Affiliate Network Expensive to start Must pay fixed fees to affiliate network monthly For affiliates to join, they must be a part of the network you choose Software Don’t have access to thousands of affiliates immediately, must work harder to promote the program Manage payments yourself Manage affiliate relationships & support yourself Affiliate System Choices Section: How Does Affiliate Marketing Work? Affiliate Network Software Starting & Running a Successful Program Step #1: Affiliate Network Section: Starting & Running a Successful Program Choose an affiliate network or choose your affiliate software Step #2: Competitive Research Section: Starting & Running a Successful Program Must research companies like yours that have affiliate programs so yours will be competitive. Questions to answer: 1. How much do competitors offer for commissions? 2. Are commissions 1-time or recurring? 3. What kind of resources do competitors provide their affiliates? 1. Banner ads 2. Videos 3. Drafted emails 4. Custom landing pages 4. How long after a visit is generated will competitors pay for sales from that visitor? 5. What kind of advertising techniques do competitors disallow? 6. How often do affiliates get paid? Step #2: Competitive Research Section: Starting & Running a Successful Program Tip: Most companies who run an affiliate program have a “partners” page or “affiliate” page which outlines the answers to these questions. Step #2: Competitive Research Section: Starting & Running a Successful Program Example: Benchmark Email Step #3: Affiliate Terms & Conditions Section: Starting & Running a Successful Program • Your affiliate program Terms will dictate the rules of your program. • Keep in mind that these rules must be enforceable • These rules need to be in-line with or better than your competitors Step #3: Affiliate Terms & Conditions Section: Starting & Running a Successful Program What to Include: 1. What exactly constitutes a commissionable event? 2. What are your commissions? % or Fixed? 3. 1-time payment or recurring payments? 4. How many days will you attribute a sale to an affiliate? 5. How often will you pay affiliates? Do they have to reach a commission balance before payout? 6. Do you accept international sales/traffic? 7. How are they allowed to promote your program? What’s prohibited? Step #3: Affiliate Terms & Conditions Section: Starting & Running a Successful Program How are They Allowed to Promote Your Program? 1. Can the affiliate use your brand name? In URL, in ad text, in creative? 2. Can the affiliate bid, in PPC, on your brand name? 3. Can the affiliate use PPC, SEO, social media, email? 4. Will you accept incentivized traffic? 5. Can affiliates promote you with pop-ups? Step #3: Affiliate Terms & Conditions Section: Starting & Running a Successful Program Example: Brand Name PPC Bidding Step #4: Affiliate Support Materials Section: Starting & Running a Successful Program • Banner ads • Drafted emails they can use • Reports they can promote with your links inside • Videos • Custom landing pages just for affiliates • Data feed (for eCommerce sites) • Customer testimonials they can use Step #5: Promote Your Program Section: Starting & Running a Successful Program • Create a page on your website for the program • Search for relevant sites in your niche and reach out to their webmasters soliciting participation. – Complimentary services – Current partners – Review websites – Deal websites – Personal blogs • If in affiliate network, pay to send out a mass email to publishers in a specific vertical Step #6: Management Ongoing Section: Starting & Running a Successful Program • Typical time commitment: 1-2 hours per day. • Approve or deny publishers that apply • Answer publisher questions or issues • Accommodate individual publisher requests • Police current publishers to ensure compliance Types of Publisher Business Models Coupon Websites Section: Types of Publisher Business Models Lead Farms Section: Types of Publisher Business Models Review Website Section: Types of Publisher Business Models Cash Back Website Section: Types of Publisher Business Models Virtual Currency Section: Types of Publisher Business Models Incentive Section: Types of Publisher Business Models Arbitrage Section: Types of Publisher Business Models Blog Section: Types of Publisher Business Models How to Become an Affiliate Yourself Step 1: What Would Help Your Customers? Section: How to Become and Affiliate Yourself • Decide what types of companies you want to promote before looking for offers. • Examples: – A website design company can also promote stock photo websites or website hosting companies – A recycling center could promote green home products – Yoga instructors could promote online stores selling Yoga equipment Step 2: Determine Promotion Strategy Section: How to Become and Affiliate Yourself • How will you promote the other companies in a way that customers will appreciate? • Examples: – Free guide you can offer that includes links to affiliate offers – Occasionally promote them via your current email list – Place them in a “resources” or “recommended partners” section on your website Step 3: Join Affiliate Network Section: How to Become and Affiliate Yourself • Apply to an affiliate network (like www.cj.com) to browse offers/companies you can promote. Step 4: Apply for Offers & Get Links Section: How to Become and Affiliate Yourself • Browse through companies inside the affiliate network and apply to them. • Once accepted, include their provided links in your promotional materials! Review Review 1. What is Affiliate Marketing? 2. Types of Affiliate Programs (CPS, CPA, CPL) 3. How Does it Work? 4. Starting & Running a Successful Program 5. Types of Publisher Business Models 6. How to Become an Affiliate Yourself Thank You Contact Information - nick@anvilmediainc.com - 503.595.6050 x233 - Twitter.com/nickherinckx - LinkedIn.com/in/nickherinckx Questions?