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Two Tier Affiliate Schemes

Two Tier Affiliate Schemes – a two tier affiliate scheme is a multi tiered program where affiliates in the first level of can also earn commission from the sale was generated from affiliates that they are recruit who sit in the second level or ‘tier’. Typically the first tier would earn 10% commission on sales it indirectly generates from Merchant sales. In addition, the affiliate may earn a much smaller percentage e.g. 2% from sales from 2nd tier affiliates they recruited to the Merchant. A two tier scheme is aimed to motivate affiliates to recruit like minded people to also become affiliates. newswibe It requires additional sales copy marketing material and a good quality affiliate manager software tool. This tool links affiliates together and details of any sales, in order to calculate potentially vast commission sums. Key to success is a higher margin product, where margin can be allocated two separate levels to the point where affiliate’s remain motivated and enthusiastic.

Affiliate Networks – an affiliate network website is an independently run collection of affiliate schemes which allow members of the network to join either one, some or all of the affiliate schemes registered with the affiliate network. It is a club making recruit of affiliates a straight forward process. This is ideal for portal websites where a range of different topics and schemes that can be advertised across a large number of different pages. Affiliate networks charge the Merchant to be part of the network and may even take a large slice of affiliates commission. In exchange, the affiliate network provides the merchant with an instant access to hundreds or even thousands of potential affiliates who have already joined the network in the past. In addition, it provides a central management console for affiliate’s to track sales and leads. It is quite simply a middleman for a large and complex number of affiliate schemes all promoting themselves alongside their competitors. An example of an affiliate network is Commission Junction.

1) Critical success factors – there are usually a range of factors that are critical to the success of your affiliate Marketing strategy:

High Commissions – affiliates marketing efforts are directly proportional to the commission they receive (relative to your competitors affiliate commission levels). A successful affiliate business model relies on a sensible amount of available margin to be divided between the website owner and its affiliate on each sale.

2) Offer a Differentiated or Unique Product or Service – prospective affiliates will be attracted to have something a bit different with professional online marketing literature. If your web site is very similar to dozens of other websites, all promoting their own affiliate scheme, why should a prospective affiliate sign up to your affiliate scheme as opposed to your competitors? Therefore, you must really try and sell to the prospective affiliate (via your website affiliate signup page), in order to recruit them as an affiliate. It is critical to summarise your unique selling points so they can clearly see there is an opportunity to make money together.

3) Quality Feedback & Reporting – constant reassurance through online reporting and real time statistics help motivate affiliates. The more management information you can provide to an affiliate, the more confidence they will have in your ability have to close the sale. As an affiliate, it is a real confidence boost to see an email confirmation every time a lead is generated or sale made that has come from the affiliate’s website. Consequently, the more motivated they will be to send additional leads in the future.

4) Great Merchant Customer Service – by providing professional and service to your prospects, your sales conversion ratio obviously improves. Prospective affiliate’s will be looking for affiliate schemes that provide good quality conversion ratios and have a good market reputation. Affiliates need to know that that every single visitor they send to your site has the greatest possible chance of making the money vie you’re selling effort. There is nothing more de-motivating for an affiliate than a lead that does not get followed up quickly enough or is accidentally deleted or ignored by the merchant.

5) Merchant Affiliate Recruitment Efforts – patience/ time to recruit the desired number of motivated affiliates is very important.. . Ask yourself basic questions… if it takes 6 months to recruit 100 affiliates who generate 200 sales equivalent to £100,000 profit in that time, could you have generated more than 200 sales in that time (and at what profit) if you had concentrated on direct selling only.

6) Affiliate Management & Tracking Systems – as the merchant you must have a thorough understanding of online affiliate tracking software and services to ensure affiliates are paid on time, sales are allocated fairly and automated new affiliate recruitment can be initiated. If you have no systems in place there are many commercial affiliate services available or software packages to provide an end to end service to manage and track affiliate’s leads and sales. This is equally important for accounting purposes as the bigger your affiliate program becomes, the more important it is to justify outgoing costs (affiliate commission payments).

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