Affiliate Program Guide
Starting and Managing
an Affiliate Program
Affiliate Program Directory
SUMMARY: Commission-based affiliate programs are the most common type of affiliate program. They offer a number of advantages, but they are not automatically suitable for all affiliates.
Advantages of Commission-based Affiliate Programs
- A carefully selected affiliate program can enhance your visitors' enjoyment of your site, as well as make you money. For example, if (as a visitor) I enjoyed reading a witty, detailed book review on your site, I might be very glad of a simple way of buying the book I was just reading about.
- If the affiliate program matches the content of your site closely, and promotes a product or service that is a good fit with your audience, then you are likely to see excellent results from a commission-based system - often earning much more than under any other form of affiliate program. In essence, commission-based programs can be seen as the ultimate test of your website's credibility and the value of your traffic: how much do your visitors value your opinion, and how much do they trust your ability to "recommend" things to them that they would be interested in buying.
- The most accurate way to demonstrate to a merchant the commercial quality of your traffic. Since commission-based affiliate programs reward you based on a percentage of total sales, it's very easy to demonstrate the value of your traffic to a merchant partner. If your visitors are purchasing an average of US$100 worth of products whereas the average is US$30, and you can close a useful number of sales each month, you've got a very good case to make for getting your commission percentage increased or receiving some other kind of incentive bonus for your performance.
Disadvantages of Commission-based Affiliate Programs
- A low click-through to conversion rate
You will find that only a few percent of your visitors will click on a banner or link; of that percentage, a few percent will actually buy something. It can be disheartening to see that there have been thousands of visits to your site, yet you have yet to generate any sales for your merchant partners.
Advice: The more you can focus your choice of affiliate programs to the theme of your site and the interests of your audience, the better the results you will achieve. Also, remember that text links, advertorials and "odd" ads (i.e. advertising that doesn't immediately look like advertising) will generally give rise to much better results than banners or buttons.
For example, if you run a site about Lord of the Rings, you're likely to make many more sales by linking to Lord of the Rings-specific merchandise (such as a boxed set of the trilogy or a DVD of the movie) than you would by linking to the front page of a book or music store. And if you set up an attractive boxed ad with some appealing text and a small graphic such as the cover of a CD, you're likely to achieve still more sales for the same volume of traffic!
- Most reliance on a merchant's ability to close sales: unlike a per-click or per-lead program, under a commission-based affiliate program you're reliant on a merchant's ability to sell to the visitors you're sending them. Of course you can improve the chance of a sale by effectively pre-selling the product or service, but ultimately it's still up to the merchant to close a sale - and if they don't sell anything to your visitors, you get nothing!
BACK: Go back to the guide to different types of affiliate program