Company A directs Customer to Company B where the transaction occurs. A publisher promotes the offer. B2B advertisers may find success in working with publishers who run B2B blogs. Is Affiliate Marketing Right for You as an Advertiser? Is there an existing affiliate network that aligns with your company’s products and services? Is Affiliate Marketing Right for You as a Publisher? How to Get Started with Affiliate Marketing Here are the steps that you need to take to launch your own affiliate program: 1. Define how you will market your affiliate program If you want a successful affiliate program, you will need to market it outside of your existing user base. Announce the program Take the time to make sure that your community knows about your affiliate program. Key Takeaways on Affiliate Marketing Unlike most marketing channels, you only pay per transaction with affiliate marketing.
Connections are the heart of online marketing. Affiliate programs take that concept to the next level.
Let’s say that you’re running a company that specializes in shoes. Your customer base knows that you’re a shoe expert but also values your input on other high quality products — like handbags. Maybe your customers have asked you about handbags, and you find yourself recommending the same options over and over again. As a shoe vendor, you’re acting as a marketer for the handbag company.
Wouldn’t it be great if you could finalize the deal?
With affiliate marketing, you can.
Company A directs Customer to Company B where the transaction occurs.
Company A then earns a commission from the transaction on Company B.
Affiliate Marketing Quick Facts
The earliest days of affiliate marketing stem back to the 1990s, around the time that Amazon launched its Associates Program (which still exists).
Affiliate marketing as grown quickly since its inception. One report points out that the worldwide affiliate marketing industry is worth $6.5 billion across sectors including retail, personal finance, gaming, gambling, travel, telecom, education, publishing, and forms of lead generation.
Affiliate programs are both consumer-based and business-to-business oriented.
Most affiliate programs follow a revenue sharing or pay per sale model. A small proportion follow cost-per-action. CPC and CPM payment methods are much more rare. Typically, commissions are fixed up-front, as part of a standard program.
Participants in the affiliate marketing ecosystem are typically known as “publishers” or “advertisers/merchants.” An advertiser/merchant is the provider of the offer. A publisher promotes the offer. A publisher can also be an advertiser — they are not mutually exclusive roles.
Here is an example of affiliate offers on a mom blog. Here, Amazon is the advertiser/merchant, and 3boysandadog.com is the publisher:
Some advertisers offer programs in tiers. Once publishers reach certain thresholds, they can begin to earn higher commission rates.
Affiliate programs are appealing to advertisers because there is no loss involved. It’s entirely based on “pay per performance.” In other words, advertisers pay for incremental sales, only.
What businesses cannot do is rely on its affiliate program to replace its sales stream. Advertisers need to actively build their own sales and marketing arms. Publishers are typically third parties and are independent entities.
Advertisers have limited ability to control publishers. If they don’t sell? Tough. Publishers might be open to hearing an advertiser’s suggestions, but ultimately, the two entities are independent from one another.
The Most Popular Affiliate Programs
Merchants can host their own affiliate programs or distribute offers through one or more established networks. An affiliate network is, essentially, a matchmaking service between merchants and publishers. Affiliate networks monetize by taking a portion of the commission.
The most popular programs are:
- Amazon Associates: Bloggers, large content sites, or large networks can choose products to market directly to their customers.
- Commission Junction: This affiliate network works primarily with large consumer brands to distribute their offers.Publishers who wish to join the network can choose from pay-per-call, lead generation, and even international solutions.
- ShareASale: This affiliate network features opportunities for B2B.
Does Affiliate Marketing Work for B2B?
ffiliate marketing can be a challenge for the B2B landscape, but success is entirely possible. For a publisher to succeed in driving sales, web traffic is key — typically, a publisher will need to generate significant traffic to generate any significant return.
If you’re a high-traffic publisher, it can be worthwhile to feature B2B offers, and revenue potential tends to be much higher, even though there are fewer sales (there are higher dollar-value transactions).
B2B advertisers may find success in working with publishers who run B2B blogs. Conversely, merchants may find success in promoting complementary products and services that are of interest to its customer base.
Check out some of Heidi Cohen’s offers, for instance. She runs a blog about marketing, so she’s promoting offers that her audience would care about — links to free guide and whitepaper downloads as well as the opportunity to sign up for a conference.
If you run a B2B blog, and you want to promote affiliate deals (but you don’t want to sell), check out RevResponse. This affiliate network will pay you to promote free resources to your readers. You’ll be paid between $1.50 and $20 per download. The value to the advertiser is that they will be able to connect with your audience. If you run a content marketing program, you can use this platform to reach audiences outside of your existing visitors.
Is Affiliate Marketing Right for You as an Advertiser?
The first step is not to go out and research potential affiliate networks.
To answer this question, you need to think about the following questions:
- What products or services would you advertise on an affiliate network?
- Who would be potential publishers?
- What would you expect the yield from these services + publishers to be?
These questions will help you forecast your revenue potential. Is the market big enough for you to pursue? If not, you should invest your limited time and resources into higher yield marketing opportunities.
An important step is to get out and talk to prospective publishers and business partners. Do they participate in affiliate programs already? What has the yield been in terms of performance? What are the typical revshares that ad networks are taking? What are typical conversion rates? What would be the incentive for publishers and business partners to promote your products and services?
Real data and partner insights can help you better understand the role of affiliate marketing in helping you meet your market demand.
After completing the exercises above, you will have determined whether affiliate marketing is right for you. Once you’ve come to an answer of “yes,” you need to make the following decision:
Should you join an existing affiliate network or create your own?
The answer to that question will stem from a simple cost/benefit analysis.
- Is there an existing affiliate network that aligns with your company’s products and services?
- What is this affiliate marketing company’s track record? Do you feel confident in the company’s ability to deliver results?
- How much time…