How to Launch an Affiliate Program
Launching an affiliate program can significantly benefit brands by expanding their market reach and driving cost-effective customer acquisition. Affiliate programs can help brands tap into new audiences, leveraging the trust and influence of partners to endorse their products or services.
Considered to be one of the most valuable marketing channels due to its guaranteed return on investment, affiliate programs offer countless benefits to brands. In many cases, the question isn’t about whether to get an affiliate program, it’s ‘How do I launch an affiliate program?’.
In this guide, we’ll show you how to do just that. Read on to discover how your brand can launch a valuable affiliate program to rapidly increase conversions.
But first, let’s start with understanding the basics.
What is an affiliate program?
An affiliate program is a strategic marketing initiative where a business partners with external individuals or entities, known as affiliates, to promote its products or services. In this relationship, affiliates earn commissions or rewards for driving desired actions, such as sales or leads, through their marketing efforts.
Typically facilitated by a tracking system, the affiliate program monitors and attributes conversions to each affiliate, ensuring fair commission rate based on performance. This collaborative approach not only extends the brand’s reach by tapping into diverse networks but also operates on a performance-based model, aligning the interests of the brand and its affiliates.
With an affiliate program, businesses can broaden their market presence while building mutually beneficial relationships with marketing partners.
Six Steps to Setup an Affiliate Program
1) Choose the Right Affiliate Network
Selecting the right affiliate network is the first step in launching a successful affiliate program. The choice of network significantly influences the efficiency of program management, tracking accuracy, and overall user experience for both you and your affiliates.
Look for a platform that aligns with the scale and needs of your business, offering robust tracking capabilities to accurately attribute conversions, user-friendly interfaces for seamless navigation, and detailed reporting features to monitor affiliate performance.
A reliable affiliate network streamlines the administrative tasks associated with running an affiliate program, enabling you to focus on strategy and optimisation rather than grappling with technical challenges.
Here at Silverbean, we work with the following affiliate networks, each who offer various benefits depending on your business needs and goals:
2) Set up the Commission Structure
There are various options to choose from when it comes to choosing the right affiliate commission structure for your business. No one structure is more correct than another – the choice depends completely on your wants, needs and expectations from the program.
Consider the following:
New vs. existing customer revenue – would your business like to place a stronger emphasis on delivering new customers to your website through the channel? ‘New customer acquisition’ is a very common objective, and splitting your commissions into this structure is possible. This can lead to a larger pool of repeat customers.
Product categories and your margins – an increasingly popular way of splitting commissions. Taking this approach will implement a tiered commission structure, whereby higher commissions can be paid out on products which have a higher profit margin, and lower commissions paid on those with smaller profit margins. Your chosen network will be able to advise on how to set up product level tracking and the subsequent commissions attached to these.
Type of purchase method – if you are a company that offers finance as a payment method, this will need taking into account. It may be necessary to decrease commission on finance orders to protect your margin, or even omit finance orders from commission completely. If you were to omit completely, affiliates would need to be made aware.
It’s imperative that the commission structure you choose to implement is mutually beneficial for both your business and the affiliate. If an affiliate feels valued and rewarded by the commission they are being offered, they will work harder to promote your products and business. The more information made available to an account manager, the more informed their commission structure recommendation can be.
3) Choose Your Cookie Period
A cookie period is the timeframe during which a unique tracking cookie is stored on a user’s device after they click an affiliate link. This enables affiliates to earn commissions for any subsequent qualifying actions made by that user within the specified time window.
Your affiliate commissions shouldn’t be a one size fits all approach – and neither should your cookie period. This also should also be taken into account on an affiliate sector basis. Content will take longer to convert than a voucher code publisher, therefore think about increasing the cookie period for a content affiliate and decreasing it for a voucher code affiliate.
In doing the above, the overall balance between the two will help to save costs, and subsequently increase overall program value for the business.
4) Add Unconditional Tracking
Conditional tracking refers to the parsing of all online sales to the affiliate network regardless of if an affiliate ‘hard’ cookie is present. This is beneficial as it will allow the ability to enable technology publishers within the channel.
You can add unconditional tracking when you set up your affiliate network. Only those sales which are generated by the affiliate on the last click model will be displayed in the network (so please don’t panic, you won’t end up paying more!). However, it will ensure that your account manager can then activate cross device tracking and payment by assist, both of which are available on most networks.
5) Implement Cross-Device and Payment by Assist
As mentioned, cross device tracking is currently available on most leading affiliate networks, as is payment by assist. Firstly, cross device tracking is based on a deterministic approach using evidence that the user is logged in across both devices. This will then enable tracking across multiple devices whereby the initial cookie is not on the converting device.
Ultimately, this ensures minimal drop off of cross device custom via your affiliate program, which makes for happy affiliates. In addition to this, with the growth of content and long tail publishers grows the need to reward affiliates based on their influence within the user journey, rather than simply just converting.
Enabling payment by assist will offer selected affiliates a cost per lead payment rather than a CPA, as a CPA is based on the long-standing last click model.
6) Set up UTM Parameters
Make sure you have UTM parameters set up correctly within your affiliate network, as these are paramount to in depth reporting, through tools such as Google Analytics. This is a simple process to set up with support, and your account manager from your chosen Network or agency will be able to implement this.
An example of how UTM Parameters should look is below:
Where ‘AffiliateID’ is automatically populated with the converting affiliate name or ID.
So for instance, if you were working with Awin, this would be:
Want to know more about launching an affiliate program? Get in touch with us today for an informal chat.