Not an Overnight Task
Doesn‟t Mean It Can‟t Be Fast
Ok, let‟s get started. The first thing I want at
the front of your mind when going through this is
affiliate sales and affiliate building is not an
overnight thing. I could lie to you, but I won't.
Affiliate building is like list building. The more
products you create and promote, the more
affiliates are likely to join you on the way. Like
with list building, the more joint ventures and
promotions you get sorted, the more people will
join your list on the way. Understand that if this
is your first day, and you don't have any
affiliates they will only grow as fast as you
promote. Keep in mind though, that even five good
new affiliates will put you well on your way to
earning a heck of a lot more.
Your First Questions
In setting up your affiliate program, the first
question you'll likely have to ask yourself is how
much do I award to affiliates per sale and on how
many levels? While there are many factors to take
into account, the answer isn't really all that
complex. Always look at things from an affiliates
point of view. We've really been spoiled by
commissions as of late, I've seen things up to 80%,
and even 100% for the first month quick start
bonuses. This is why it's important that your first
level is at least 40%. Remember that's not a 60%
loss, it's a 40% gain from a sale you may never
have made. If there‟s one thing I‟d like you to
keep in mind at this point, it‟s that when getting
started, affiliate promotion is more about resource
building for future promotion than making immediate
profit, something the big earners realized early
on. Sure you‟d give away 80-100% if it meant you‟d
have a list of several thousand to promote to as a
result of the increased affiliate activity. Don’t
think in two dimensions, or you‟ll see your highly
contested for affiliates go elsewhere for higher commissions.
Next up comes level two. It's really important to
have a level two commission going, because this
will give all the first level referrers a passive
income (cliché, I know) once they've exhausted
their first level promotion. I know some people who
won't even promote products unless they have a
second level commission there (very big tip, don‟t
forget this widespread factor), or the first level
commission is particularly high. So a second level
is a must, unless you have a very high ticket
product to start with. Use your discretion, and
remember to test whilst your selecting your levels
and whilst your affiliates promote for you.
Now I understand that there may be circumstances
where 40% commissions or a second level commission
may not be possible. For example, if the products
that you're creating are tangible, or have a high
production cost, but still go ahead and create
yourself an affiliate program, whether it's five or
ten percent. It won't get you as much interest as a high commission program, but you really don't have
much choice when paying a 40% commission rate would
put you at a loss every sale.
Taking into Account the Price of
Your Products
The next thing you'll want to look at when trying
to set your affiliate commissions is the price of
your product itself, and its structure. It's far
easier to get people to promote for you in four
situations.
1. Where you have a high price
2. When your commissions are higher
3. When you have a second level
4. Where the commission is re-occurring over time
If your affiliate program doesn‟t meet at least one
of those requirements, we have a problem on our
hands. The more of these four points it meets, the
stronger is your position both for attracting
affiliates and keeping them promoting.
Analyze Your Offer Objectively
I've had people ask me why they're having trouble
getting affiliates to promote for them, and more
often than not, they're trying to get people to
promote a one off sale $10 product, or something
similar. Now if that's not re-occurring, and has no
follow-up product, then what good is a $5 one off
commission for the promoter? Not a lot. Of course
I'm not saying you wouldn't get any affiliates in
this situation, but it may be harder than you
expect to attract. The competition for joint
ventures, lists, and affiliates right now is as
harsh and as cut throat as the competition for
actual sales of products.
So before you actually decide to shell out on some
sort of affiliate software, make sure that you
don't offer commissions that are too low, nonreoccurring, or don't have a second level.
Put yourself in the affiliates’ shoes. Remember,
they don‟t care about your profits. They care about
theirs.If you were them, would you promote your product?
Would it be profitable for you? Would it even be
worth your time? These are the things to think
about when not only setting commissions, but
deciding whether or not it's even worth having an
affiliate program up there for people to take
advantage of in the first place. If you can't
answer those two questions with a confident 'yes'
then your setup probably needs to be changed in
some way until you can, because it's likely others
will have the same reaction as you, and your
tracking and testing results will tell you the
same.
If you don't have an affiliate system up and
running already, and have just skimmed through this
so far, I would suggest coming back and using this
as a reference when you do start thinking about
setting one up. It should be soon though, how about
with your next product?
A Short Quiz. How Well Do You
Analyze the Affiliate Profit
Potential of Your Products?
Time for a little break from the figures. Just in
case you're a little unclear about what I just said
above, I want to hit you with a few examples to
demonstrate my point, and to prove that you do
actually know how to analyze the situation
effectively and make changes to your advantage. So
here are some examples, and some questions for you.
You just learned how to do something new. Here’s
the proof.
Example one: A year or two back (This is a true
story by the way), someone I met through one of my
sites tried to strike a joint venture deal with me.
It was a JV of the simplest kind. He gives me
higher commissions, and I promote his product.
Ignoring the quality of the product right now and
just concentrating on it's earning potential, he
had a $57 product, and offered me two dollars per
sale, one off commission. It's probably quite obvious at this point that I said no at the time,
and for good reason.
Would you promote anything for $2 per sale on a one
off single level commission? There are far better
deals out there.
So what do you reckon he could have done to entice
me further, improving his offer at the same time?
Try and come up with a couple of ideas based on
what we‟ve just talked about before reading on.
How about bringing the commissions up to an even
60% for a start? It was a JV after all, so I'd
expect higher than average commissions. Even at
50%, I may have been tempted to accept. Hey, it's a
quick burst of cash, it was possible I may have
said yes. So how else could he have enticed me?
Remember back to the four points we discussed a few
minutes ago..
How about some commissions over two level? That
would have meant my one off promotion, while not reoccurring isn't quite so one off anymore. If he
wanted to entice me further, he could have dropped
the commissions to maybe 45-50% and offer a monthly
recurring commission if the product allowed this.
Taking things a step further, what if the product
he had been selling for $57 was a low ticket item
that fed through to a high priced one off sale for
$200-$2000 per sale at 50% commission? I definitely
would have gone ahead then if the product was
quality.
Do you see how bad design of a pay plan or product
in general can doom it failure from the start,
unable to be revived without some major overhauls
to how the whole sales system works? You may wonder
why you‟d change the way your whole business works
just to get me promoting, but that‟s not what it‟s
about. In general, affiliates are after the same
thing in a program they‟re going to promote,
whether it‟s me, or any of the other thousands upon
thousands of them out there.
Can you also see how through this last snippet of information about bringing a low priced product
through to a high priced product, you can attract
people who wouldn‟t normally promote a $20-$50
product for someone else? There‟s plenty of people
out there who only promote for others if it‟s a
high ticket item. This is a great way to carve your
way through the competition and start pulling in
the joint venture prospects that do just that.
Joint ventures are a whole new ball game however,
so we‟ll continue on now through affiliate
management.
All About Adding Value
So you see, it's all about adding value, something
that many demote to just a product sales relevant
technique, however it is one of the biggest
improvements you can make to any of the resource
building parts of your business, be it affiliates,
list building, JV‟s, returning customers, any of
them.
Your product doesn't have to be the most expensive,
or offer the highest first level commissions in the
world. It doesn't even have to off reoccurring
commissions either, but it does have to be
worthwhile for anyone to consider promoting for
you. And remember, it's about building affiliates
for the future rather than to make a shed load of
money in a few hours. If you have to give a little
bit more away short term to gain long term
affiliates and contacts, that's definitely one heck
of a good deal. Don't think of it as having to
wait. Think of it as having the choice to earn $100
extra a week for the rest of your life, or having
to be patient but earn $1000 and more extra per
week for the rest of your life for example. I know
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