Can you trace 16 percent of your revenue to one source?
The digital marketing world is benefiting from one type of promotion that accounts for 16 percent of all online spending.
That promotion is: Affiliate marketing.
If you’re not honed in on the benefits of affiliate marketing, you’re missing out of what’s expected to be a $6.8 billion industry by 2020.
Starting an ecommerce business and generating sales is much more than pushing a product into someone’s inbox or Facebook feed. Building a loyal customer base is key to eCommerce success as it costs 6 to 7 times more to acquire a new customer than to profit from a previous buyer.
What is affiliate marketing?
Affiliate marketing is the process of partnering with an influential blogger, business, or brand that promotes your products.
Those websites, also known as affiliates, get paid when one of the visitors they send to your site makes a purchase or completes an action. Affiliate marketing is quickly taking over ecommerce marketing plans as one of the most effective ways to rack up revenue.
Affiliate marketing facts:
- Eighty-one percent of brands utilize affiliate marketing.
- Sixteen percent of all online orders are generated through affiliate marketing.
- Thirty-eight percent of marketers say affiliate marketing is a top customer acquisition method.
- In most affiliate programs, less than 10 percent of affiliates drive 90 percent of conversions.
- According to Google Trends, between September 2016 and September 2017, search interest in the term "affiliate marketing" increased by 30 percent.
While affiliate marketing may be growing in popularity, having affiliates and having effective affiliates are two entirely different things.
Invest the time to build real relationships with your partners, and use these tips to drive affiliate marketing success for your ecommerce store.
Affiliate marketing tips for eCommerce stores
1. Use established affiliate programs
By running your own affiliate program, you limit yourself to affiliates who already know your brand. Running your own program also means you have the setup and overhead costs of managing affiliates.
Partnering with effective affiliate platforms, however, introduces you to a core of affiliate websites who otherwise wouldn’t have been introduced to your products. Those affiliates can find you organically on an affiliate platform, link your products to their audience, and increase your revenue.
2. Design banners in multiple sizes
Even the best of affiliates can become habitual in their promotional efforts. For this reason, you should take it upon yourself to create banner ads in multiple sizes and designs.
An affiliate may be used to running 300-pixel-by-250-pixel ads, but if all you offer are 728-pixel-by-90 pixel leaderboards, the affiliate could skip over your product completely.
Offer a wide range of creative material to attract the most influential affiliates. Different designs will also prevent banner blindness and allow affiliates to choose the style and color scheme that works best for their needs.
3. Offer a competitive commission
Most affiliates are willing to work with a flat fee or tiered commission approach if it’s worth their while. If you set your commission rates too low, affiliates will look over your program, assuming the payout won’t be worth their time.
Your commission rates will be highly related to the ecommerce vertical you are in, so make sure to check out your competitor’s rates. The average affiliate marketing rate is between 5 and 30 percent. If you can grow your commission to 20 percent, you’ll attract the strongest affiliates, but if you’re looking for a good starting point, go for 8 to 12 percent.
4. Build partnerships with affiliates
Don’t think that jumping into a reputable affiliate program takes care of your strategic marketing plan. You need to keep the lines of communication open and support your affiliates in any way possible.
Consider sending them sample products, offer incentives beyond the base commission, and provide fresh creative material periodically. PayLoadz reports the three most important factors affiliates consider:
- Commission — 19 percent.
- Merchant reputation — 13 percent.
- Relevancy of the product to what they promote — 11 percent.
5. Monitor for fraud
Be aware of where your affiliates are placing your links and if the traffic you get comes from real people. Look for warning signs like:
- Conversion rates are too low: Your ads are placed among many others, creating ad blindness.
- Conversion rates are too high. Check to see if affiliates are using your links too often to increase their commission.
6. Offer affiliate guidelines
Without proper guidance, affiliates may begin to promote your products in a way that doesn’t align with your brand. To prevent these situations, give guidelines of how your affiliates can use your logo and branding.
If necessary, ask to approve the post before it’s published. Use an online tool that keeps up with your brand mentions and your affiliate’s work.
- Mention: Monitors news sites, affiliate blogs, and social media for specific brand mentions.
- Google Alert: Receive an email alert when a new webpage, blog post, or research is complete on your predetermined keywords.
7. Close the deal
Affiliates will get the traffic to your site, but you need to be prepared to make the conversion. No matter how visitors arrive at your ecommerce site, it’s your job to ensure they make a purchase before they leave.
The top reasons why people don’t make a purchase on an ecommerce site include:
- Buying process isn’t easy.
- Complex checkout process.
- Overpriced items.
- Hidden charges.
Prepare your site to convert traffic into customers with straightforward, transparent directions, high quality product pages, and an easy checkout process.
The more sales you make and higher earnings-per-click, the more motivated your affiliates will be to promote your products.
8. Powerful mobile site
With online shoppers using their phone or tablet more than ever to discover new brands, take in content, and read reviews, your mobile site needs to be ready to handle traffic. OuterBox reveals just how prominent mobile use has become.
- Ecommerce revenue makes up 10 percent of all retail revenue.
- Sixty-two percent of smartphone users have made an online purchase with their mobile device in the last six months.
- One-third of all ecommerce purchases during the 2015 holiday season were made on a smartphone.
- Eighty percent of shoppers used a mobile phone inside of a physical store to either look up product reviews, compare prices, or find alternative store locations.
9. Focus on high AOV products
Focus on the products that bring in the highest AOV and make your affiliates aware of those products. To increase your AOV, use these tips:
- Offer a first-time buyer discount: Encourage your new customers to make their first purchase by offering a 20 percent discount when they provide their email address.
- Free shipping threshold (all orders more than $100 ship free): A retail study shows 90 percent of online shoppers say free shipping is the number one incentive to get them to make a purchase.
- Minimum spend discount: Incentivize shoppers with a discount scale. For example, get $15 off when you spend $75, get 20% off when you spend $50, or get 30% off when you spend $100 or more.
10. Find influencers
Don’t just rely on affiliate marketing platforms to find influencers. Do your own due diligence to find the influencers in your niche and invite them to partner with you as an affiliate.
One of the simplest (and cheapest) ways to find influencers is to search for websites and bloggers whose audience falls in line with your target market.
Use Google to search for what you would consider your target audience, then sift through the results for possible influencers. Tools like Buzzsumo can also analyze what pieces of content are performing best for any topic.
Affiliate marketing can become a key source of online revenue for your eCommerce business. In 2019, people are expected to spend an average of 170.6 minutes each day online and affiliate marketing can grab those customers and push them to your website.
As more shoppers turn to the online world, you need the support of affiliates to put your brand front and center.