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Monday, April 07, 2008

Developing an Affiliate Program

Monday, April 07, 2008

One of the best ways to improve traffic to your website is with the help of targeted websites who earn money promoting other peoples products. One of the websites I work on generates more than 35% of its revenue from other sites selling their products and services. If developed correctly, affiliate programs can have a significant impact on your revenue.

What Is and Affililate Program?

An affiliate program is a way for you to sell your products through other websites. Essentially the process is simple. You provide another website with the necessary promotional items to sell your product(s). However, the affiliate never takes actually inventory of the product you are selling.

A great example of this is the website that sells mystery novels. For this example, let’s call the primary website Mystery Novels Central dot com. The website provides an affiliate website (affiliatewebsite1) with some banners and buttons promoting mystery novels. When a browser of affiliatewebsite1 clicks on the banner, it redirects him to Mystery Novels Central dot com. If the user purchases a novel, Mystery Novels Central dot comp pays affiliatewebstie1 a percentage of the sale – also known as a commission.

How Do Affiliate Programs Work?

When your promotional assets are placed on another website, each asset has a tracking URL. This tracking URL is invisible to the browser but keeps track of his activities. When he passes through the purchase process and receives a payment confirmation page, additional tracking code confirms a sale. This information is captured and tracked back to the initiator of the sale (i.e. the affiliate).

In its most simple form, an affiliate program works like a real life sales force. Imagine having sales reps spread our across the Internet selling your product to each of their new and existing customers. Each time that sales rep sells your product, you fulfill the order and pay the rep a small commission. In a nutshell that’s an affiliate program.

How Can I Start My Own Affiliate Program?

You can start your own affiliate program in a variety of ways. One of the most simple methods is to use and affiliate marketplace like ClickBank or PayDotCom. These affiliate sites aggregate many affiliate products. For a small fee, and sometimes simply a percentage of the sale without an upfront fee, you can join their program.

When you join, you agree to let the marketplace add your product to a list of products that third party websites can promote. When you do so, you also agree to let the affiliate marketplace (ClickBank or PayDotCom) receive a percentage of each sale. Remember, you will also have to pay a commission to the actual affiliate website that promotes and sells your product. The fees can add up quickly but are worthwhile if your product has a good margin.

There are other programs from well established companies like Commission Junction, but they charge a significant fee for joining and a larger percentage of each sale. For those starting out, CB or PayDotCom is your best choice.

What I particularly like about affiliate programs is the scale you can achieve. Affiliate programs are relatively easy to set up and can have a significant impact on your top line. If you have a product to sell and haven’t started using affiliates to promote your program, get started today.


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