Affiliate marketing is the promotion of other people's products in return for commission. Used by81% of brands and 84% of online publishers, we say it's worth a closer look.
Affiliate programs have gained popularity over the past several years for a variety of reasons. For one, it’s a strategy that’s well-suited for the connected digital world—so much so that theaverage order value for affiliate sales is 21% higherthan other marketing channels, and annual customer revenue can increase by as much as 58%.
Affiliate programs equip marketers and retailers of every size to reach a wider audience while winning new customers and boosting revenue. It can be tough, however, for newbies to figure out where to start.
Here’s a look at how affiliate programs work, how you can get started with affiliate marketing, and some examples of successful programs.
What is a retail affiliate program?
Let’s look more closely at what a retail affiliate program is. From the perspective of the affiliate,marketing adviser Pat Flynn defines affiliate marketingas “the process of earning a commission by promoting another person’s (or company’s) product.”
For retailers, affiliate programs tap into a network of partners and promote products to their audiences, providing a link for consumers to buy directly from the retailer. In return, retailers pay these affiliates a set commission for each sale that comes from their following.
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How affiliate programs work
Affiliates promote and link toyourproducts from their own website, blog, social media, or email. When customers click that link and ultimately make a purchase from your store, you pay out the commission (say, 5%) based on the total amount of that order.
Affiliate links
Orders from affiliates are tracked by creating a special link that allows you to see where visitors to your欧宝体育官网入口首页came from. Here’s an example of a what one looks like:
http://www.amazon.com/dp/ASIN/?tag=123456
In this example, the tag “123456” represents an individual affiliate’s ID number. You’ll assign a different number to each affiliate you partner with—creating a unique link allowing you to identify and keep track of the consumers they send your way, whether or not they become customers, and how much they spend.
This makes it easy to figure out which affiliates are sending the highest and most-valuable traffic so you can double down and pay them accordingly.
Should you pay per sale, per lead, or per click?
The majority of retail affiliate programs pay affiliates for each order that comes from their unique affiliate link, known as pay per sale. However, some retailers also opt to pay affiliates per lead, per click, or some combination of all three. The way you pay affiliates, along with the percentage commission you offer, can fluctuate and evolve.
Deciding which method is best for your store depends on the primary goal of your affiliate marketing. If you’re looking to increase brand awareness and recognition, pay per click could be the best option. If you’re strictly in it to boost revenue, the typical pay per sale is a better option.
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Affiliate marketing for your retail store
The two main ways retailers implement an affiliate marketing program include building their own program and going directly to affiliates, and joining a third-party affiliate network to gain access to affiliates and streamline the back-end of the process.
Top affiliate networks for retail
There are myriad benefits and drawbacks to building your own program or using an affiliate network, but the key point to remember is that joining an affiliate network means you’ll have to pay an additional commission to the third party (on top of what you pay affiliates). If you’re a small retailer, this can eat into your profits in a hurry.
That said, joining an affiliate network makes it seamless to market your program and bring on affiliate partners. If that sounds right for you, a few of the top retail affiliate networks to consider includeShareASale,Rakuten Marketing(formerly Linkshare), andFlexOffers.
Building your own retail affiliate program
Building your own retail affiliate program is both easy to do and easy toautomate. If you’re already using Shopify, you can access tons of plugins and modules that make it easy totrack affiliate sales and pay out commissions.
If you’re not a Shopify merchant, there is other software you can choose from likeErass,vNative, andReferral Candy.
The first step in building a program for your store is to identify the audience you want to reach:
- Who are your ideal customers?
- Where do they spend time online?
- Who do they listen to?
This information is vital because it informs which influencers, bloggers, or other personalities will be effective affiliates for your business.
The next step is to decide how you’ll set your commission structure. As mentioned above, you can choose to pay per sale, per lead, per click, or any mix of the three.If you’re in doubt, paying per sale is always a safe bet.
Once that’s decided, consider what percentage you feel comfortable offering in exchange for each sale. Affiliate commissions are usually a small percentage (typically less than 10%) and can vary from one type of product to another. It’s also common to offer higher commissions to affiliates who send more orders your way.
Target, for example, offersbetween 5 and 8% commissionon home and outdoor living products and only a flat 1% on health and beauty.
当你有一个潜在的子公司和y的列表ou know what you’re willing to pay for a commission, the next step is to reach out and recruit those affiliates for your store. Once you’ve brought them on, you can automate affiliate order tracking and payment using the Shopify plugins or one of the software options mentioned above.
Why you should be picky about your store’s affiliate partners
It’s easy to fall into the thinking thatanyaffiliate sale is a win. However, the best affiliate marketers take it a step further and exercise extreme prejudice when selecting partners.
After all, a one-off sale isn’t as valuable as a repeat customer — but if they come from an affiliate, you’ll pay the same for both.
That’s why it’s good practice to be picky about the affiliates you work with and pay. Use a tool likeHubSpot CRMorSalesforcethat allows you to track the entire lifecycle of new customers brought in through affiliate marketing. This makes it easy to make informed decisions about where to spend and double down on your affiliate marketing efforts in order to get the best returns in the long term.
Examples of Retail Affiliate Marketing Programs
Harry & David lets data inform spend
Harry & David specializes in premium food gifts and gift baskets. The company lets data speak for itself and lead its investment in affiliates, whether working with individual partners, affiliate networks, or large coupon websites. It considers more than just affiliate performance, tracking affiliates’ search and traffic trends outside their contribution to Harry & David.
Digital marketing manager Christian Schwindletold Digital Commerce 360that the company’s analytical approach to affiliate investment led to the best returns — skyrocketing revenue from one particular affiliate “from five digits to seven digits.”
Amazon combines affiliate marketing with Prime membership
It’s not a secret that Amazon owns a large share and a wide variety of the ecommerce market. That makes it a no-brainer for affiliates to hook up with their affiliate network, Amazon Associates.
But affiliate programs accomplish different things depending on your business model. Amazon enjoys a lot of trust from digital shoppers, so its affiliate program is less about social proof or reach and more about generating demand for individual products. By combining its affiliate and membership programs, Amazon boasts a74% conversion rate for Prime members.
MVMT protects the bottom line with time-limited commissions
MVMT, a popular direct-to-consumer watch brand, uses its从属节目来提高收入. As mentioned earlier, affiliate marketing can serve a lot of roles for your business, and MVMT was clear on how it would use the tactic.
The company built a large band of affiliates by offering above-market commissions of 10% — but to ensure it only paid for immediate sales (instead of brand awareness or just leads), it put a time limit on commissions. Affiliates are paid only when customers buy from their link within 15 days.
Affiliate marketing for retail
When done right, retail affiliate programs can be a huge boon for your business. They can facilitate higher sales, grow brand recognition, and even promote trust in your business — that’s why so many of today’s businesses lean on affiliate marketing in one way or another.
By building an affiliate program that’s best for your business, and letting data lead your decisions and investments, you can boost revenue in a sustainable way.
Attract and retain customers with Shopify
Only Shopify gives you all the tools you need to find new customers and keep them coming back. Connect with local shoppers on Facebook, Instagram, and Google, build customer profiles to fuel your retention marketing email campaigns, and more.
Retail affiliate programs FAQ
What is the highest paying affiliate program?
What brands have an affiliate program?
How do I become a store affiliate?
What are the 3 main types of affiliates?
- PPC Affiliates: These affiliates use pay-per-click (PPC) campaigns to drive traffic to their partner sites.
- 内容子公司:这些子公司创建content related to the products or services being offered and promote them through blogs, websites, videos, and other digital channels.
- Referral Affiliates: These affiliates use referrals to drive traffic to their partner sites. They can use email campaigns, social media posts, or even physical cards to refer customers to their partner’s website.
