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Start an Affiliate NetworkJune 12th, 2008 Building Affiliate Programs Imagine that you have a sales staff of hundreds - and you don't have to pay them a dime unless they close a deal. In short, this is the basic principle underlying online affiliate programs. Affiliate marketing was conceived as a way to steer a targeted audience from one non-competing commercial web site to another - via link or banner - and to reward the referring agent for helping establish the customer connection. Basically, it works like this. You encourage other online business owners or website operators to place a link on their site to your online storefront. When a visitor clicks on a link, goes to your site and makes a purchase, you pay the referring partner a commission. Another less common method of compensating affiliate partners is a pay-per-click model where you pay a fixed amount for each referred visit to your site - regardless of whether a purchase is made. |
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In building an affiliate program, there are a number of strategic issues to consider. Obviously not all of your affiliates are going to drive the same volume of traffic to your site.
When identifying prime candidates to approach regarding your program, look at where they rank on search engines and try to determine what kind of web presence and domain clout they hold.
Also make sure the target audiences of your affiliates line up demographically with your audience. Finally, encourage your affiliates to place your links and banners in locations that will maximize meaningful traffic. If links are not tuned accurately you won't be generating enough - or at least enough of the right kind - of customers.
Whether you manage your own affiliate program internally - or outsource to an affiliate management company - you'll still need to maintain your program to some degree.
Establishing regular communication between you and your affiliates is important, as is monitoring affiliate statistics and the programs of your competitors.
As in most areas of e-commerce, comparing your marketing model with the competition's attack is good, sound practice.
The same goes with affiliate programs. Investigating a competitor's program shows you what you're doing right, where there's room for improvement, and how to capitalize on your unique strengths.
The effort is worth it. In focusing the greatest number of the right customer's eyes to your site, affiliate programs have proven to be an innovative and powerful e-commerce force.