Developing Your Affiliate Program

by Ryan Allis

If you have an affiliate program or plan to get one, congratulations! You have discovered a 'secret' to online marketing. Affiliate programs can be very effective if implemented, promoted, and managed correctly. On the other hand, few people are able to draw enough affiliates or develop the joint ventures with the major companies needed for their programs to reach full potential.

So what are the keys to successful implementation of an affiliate program?

First you need a great product with a good profit margin. Then a professional and content-rich site on which it can be purchased through a secure server and shopping cart. Next, you need to develop a system to recruit affiliates. The key to this is periodically contacting every related business who may wish to promote your product (for a commission), and following up with these contacts. After that, once your model proves itself, you will need to go after "the big guys" and aim to develop strategic alliances and joint ventures with the leaders in your niche and industry.

Here are the steps I followed to create an affiliate program that as of October 2002 has 1200 active affiliates and produces $45,000 in net profit per month.

1. Develop your website, content, and products. All three elements must be of high quality and must be in place before you begin promoting your affiliate program. Be sure you have a well designed and professional site, well-written copy, an intuitive navigational interface, and a shopping cart on a secure server before you begin to develop your affiliate program.
2. Implement Affiliate Software (see http://www.edgepromote.com for two recommended affiliate programs)
3. Develop payment amounts or payment schedules for affiliates. The going rate tends to be between fifteen and twenty five percent of the sale. This will depend on the price of the product and your net profit on each sale. Be sure you make the commission worth your affiliates' efforts, even if this forces you to raise your prices a bit.
4. Develop an affiliate extranet (a centralized management area) on your home website with promotional graphics, text copy, best practices, and sales/visitor statistics. The statistics should come with your affiliate program. If they do, linking to the reporting feature is all you will need to do from the extranet. You may wish to hire freelance workers to develop your graphics and text copy if you are not good enough at these tasks yourself. Virante has a great staff that can do this for you .
5. Develop a spreadsheet (in Microsoft Excel or Microsoft Works Spreadsheet) of potential affiliates. First, develop a list of keywords related to your product(s). Then one-by-one search for the keywords in a major search engine and directory. Add the e-mail address of any related site (do not spam unrelated sites), and also add the URL to your database or spreadsheet. For example, your product is a nutritional supplement and you are trying to gain affiliates who have related websites. Then your spreadsheet might look like this:
   
   
   Note: You will want to delete Entry 7 from your spreadsheet, as it is most likely an education and not a commercial site (evident from the .edu). No one likes Spam so please be sure to check your lists for irrelevant entries before your send out your email.
   Note also: Instead of doing this process manually (by going through the search engines and checking each keyword and visiting each site) you can use a program called Supersonic to do this searching automatically. Of course, you still must visit each site to assure relevancy, but this software can save you hundreds of hours.
6. Contact potential affiliates via email (use mail-merge mailer such as Mail-loop from http://www.edgepromote.com to save time).
7. Keep records in your spreadsheet on who responds and who does not. Most likely the easiest way to do this will be do delete each line. Use the find function to find the applicable text as you either hear back from the potential affiliate or if they sign up for the affiliate program. You can also simply compile a list of emails to remove from the list and then use the Database Cleaning feature in Mail-loop (see above) to remove these entries automatically. After making sure your records have been cleaned, re-contact non-responding potential affiliates via email after 7 days and again after 14 days.
8. Repeat steps 4 through 7 continuously. Continue to use Supersonic and Mail-loop on additional keywords, unless you have additional support staff to respond to e-mails and phone calls, I'd suggest that you do not contact any more than 10,000 potential affiliates per week, or you may become pilled up with replies and could potentially lose affiliates.
9. Identify potentially large affiliates and large joint ventures and contact them over phone, fax, and/or mail. Do whatever it takes, within the realms of profitability, to convince these "big guys" to promote your product, even it means offering a higher commission to select partners.
10. Re-contact potentially large affiliates and joint ventures via phone, fax, and/ or mail. This comes under the 'do whatever it takes' category. The key is to keep following up and to keep records.
11. Repeat steps 9 and 10 continuously as well.
12. Send out monthly checks with an update letter. Some affiliate programs allow you to download monthly payment data to an .iif file for direct import into the accounting software QuickBooks.
13. Send monthly update newsletters to affiliates with info on best practices for producing customers and sales.
14. Continuously improve website, content, and products and notify affiliates of updates accordingly.