Getting Started with Affiliate Marketing

Formic Media Seminar Series: Affiliate MarketingSponsored by: Hosted by:Spool Video Formic Media, Inc.www.FormicMedia.com www.FormicMedia.comBrian Schatz| brian@spoolvideo.com John McPhee | johnm@formicmedia.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 2011Nick HerinckxSenior Account Executive503.595.6050x233nick@anvilmediainc.com Provided by Anvil Media Inc. ©2011—All Information in This Document is Copyright ProtectedAnvil Media, Inc. and the Property of 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

Overview1. What is Affiliate Marketing?2. Types of Affiliate Programs3. How Does it Work?4. Starting & Running a Successful Program5. Types of Publisher Business Models6. How to Become an Affiliate Yourself

What is Affiliate Marketing?

DefinitionAffiliate marketing is paying someone else togenerate business for you online, where youonly pay for performance. Section: What is Affiliate Marketing?

Publisher vs. AdvertiserPublisher (the affiliate) Advertiser (the brand)• Promotes your company for • Wants leads/sales you • May not have a big budget or time to devote to marketing• Often owns a related website, email list or has • May simply want more exposure money to test on advertising on other affiliates’ sites• Gets paid only when they • Pays a fixed amount or a percentage of a sale to the accomplish a sale, lead or affiliate only when a sale is made other action you outline or lead is generated Section: What is Affiliate Marketing?

History• Amazon invented the concept of affiliate marketing online. Section: What is Affiliate Marketing?

History• Affiliate marketing spending is expected to reach $4 billion in 2016 (Marketing Sherpa)• Some top brands are affiliate marketers: Section: What is Affiliate Marketing?

Benefits of an Affiliate Program• 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 Section: What is Affiliate Marketing?

Challenges of an Affiliate Program• 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 Section: What is Affiliate Marketing?

Types of Affiliate Programs

Cost per Lead (CPL)You pay for leads generated, typically a fixedcost up front plus another sum if lead turns intoa sale later on. Section: Types of Affiliate Programs

Cost per Lead (CPL) Payout: • $10/lead • $700% for sale Section: Types of Affiliate Programs

Cost per Lead (CPL) Section: Types of Affiliate Programs

Cost per Sale (CPS)• You pay only for sales generated, typically a % of the order total. Section: Types of Affiliate Programs

Cost per Sale (CPS) Payout: • 7% of sale Section: Types of Affiliate Programs

Cost per Action (CPA)You only pay for a specific action taken, typicallya flat amount. Section: Types of Affiliate Programs

Cost per Action (CPA) Payout: • $1 per download Section: Types of Affiliate Programs

How Does AffiliateMarketing Work?

The Tracking Process• 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 Section: How Does Affiliate Marketing Work?

The Tracking Process• 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! Section: How Does Affiliate Marketing Work?

Affiliate Systems• Once you install an affiliate system, the whole tracking and payment calculations happen automatically. Section: How Does Affiliate Marketing Work?

Affiliate Software ChoicesAffiliate Network Self-Managed Software3rd party/intermediary Easy-to-use software thatbetween advertisers and provides all theaffiliates. tracking/technology to run your own program. Affiliates Affiliates Network Advertisers Advertiser Section: How Does Affiliate Marketing Work?

Affiliate Software Choices - ProsAffiliate Network Software Immediate access to  Much less expensive thousands of affiliates  Much better for They manage affiliate SEO/increasing site rankings relationships  Complete branding control 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) Section: How Does Affiliate Marketing Work?

Affiliate Software Choices - ConsAffiliate Network SoftwareExpensive to start Don’t have access toMust pay fixed fees to thousands of affiliates affiliate network monthly immediately, must workFor affiliates to join, they harder to promote the must be a part of the program network you choose Manage payments yourself Manage affiliate relationships & support yourself Section: How Does Affiliate Marketing Work?

Affiliate System ChoicesAffiliate Network Software Section: How Does Affiliate Marketing Work?

Starting & Running aSuccessful Program

Step #1: Affiliate NetworkChoose an affiliate network or choose your affiliate software Section: Starting & Running a Successful Program

Step #2: Competitive ResearchMust research companies like yours that have affiliate programs soyours 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 pages4. 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? Section: Starting & Running a Successful Program

Step #2: Competitive Research Tip: Most companies who run an affiliate program have a“partners” page or “affiliate” page which outlines the answers to these questions. Section: Starting & Running a Successful Program

Step #2: Competitive ResearchExample: Benchmark Email Section: Starting & Running a Successful Program

Step #3: Affiliate Terms & Conditions• 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 Section: Starting & Running a Successful Program

Step #3: Affiliate Terms & ConditionsWhat 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? Section: Starting & Running a Successful Program

Step #3: Affiliate Terms & ConditionsHow are They Allowed to Promote YourProgram?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? Section: Starting & Running a Successful Program

Step #3: Affiliate Terms & ConditionsExample: Brand Name PPC Bidding Section: Starting & Running a Successful Program

Step #4: Affiliate Support Materials• 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 Section: Starting & Running a Successful Program

Step #5: Promote Your 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 Section: Starting & Running a Successful Program

Step #6: Management Ongoing• 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 Section: Starting & Running a Successful Program

Types of Publisher BusinessModels

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 AffiliateYourself

Step 1: What Would Help Your Customers?• 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 Section: How to Become and Affiliate Yourself

Step 2: Determine Promotion Strategy • 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 Section: How to Become and Affiliate Yourself

Step 3: Join Affiliate Network• Apply to an affiliate network (like www.cj.com) to browse offers/companies you can promote. Section: How to Become and Affiliate Yourself

Step 4: Apply for Offers & Get Links• Browse through companies inside the affiliate network and apply to them.• Once accepted, include their provided links in your promotional materials! Section: How to Become and Affiliate Yourself

Review

Review1. What is Affiliate Marketing?2. Types of Affiliate Programs (CPS, CPA, CPL)3. How Does it Work?4. Starting & Running a Successful Program5. Types of Publisher Business Models6. How to Become an Affiliate Yourself

Questions? Thank YouContact Information- nick@anvilmediainc.com- 503.595.6050 x233- Twitter.com/nickherinckx- LinkedIn.com/in/nickherinckx

Getting Started with Affiliate Marketing

by Formic Media, Inc. on Aug 11, 2011

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Getting Started with Affiliate Marketing — Presentation Transcript