Types of Compensation Tips

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Are referrals guaranteed to earn me revenue?

Refferal Networks Take More Than Just Sign-Ups To Be A Success

While signing up people under referral programs is a great bonus in affiliate marketing and can net great revenue results for your business, if you simply recruit others but don't help them to sell and don't sell the products yourself, you won't get very far. If you sign someone up under you but neither of you sell anything, it won't amount to much.

However, if you sign people up under you and then help them sell the product everyone will benefit. Some programs have multi-tiered refferals so you may even earn commission from your refferal's referrals. This is most effective, obviously if everyone is selling. If you can get the individuals in your downline motivated to sell products and sign up users, everyone benefits. Helping them with tips and pep talks is a great start.

   
How can I find ezines to advertise my site so I can make more money through my associate programs?

Associate Programs and Ezines

Advertising in e-zines or newsletters can help drive traffic to your web site so you can improve your profits on your associate programs!

Do a search for "newsletter directories" (or a similar phrase) and look for newsletters that will reach your target audience. Make sure the newsletters you decide to advertise with have a large enough subscription base to make it worthwhile. Set up a separate landing page for each newsletter so you can track which ads bring you the best return on your money. On the landing page, repeat your advertisement line and mention the newsletter by name to welcome your visitors.

   
Shouldn't I automatically approve every associate who applies to my affiliate associate program?

Running Quality Affiliate Associate Programs

Many people think that the more associates they have signed up for their associate program the better. However, you should not approve anyone who wants to sign up for your program. Your focus should be on building a quality affiliate associate program, not just on getting the most numbers.

Good associates work for you and reflect on your image. For example, an associate who's using a free web site is probably not treating this as a business and won't do much for your sales. It takes time and money to monitor your associates, so eliminate the ones who are not producing for you.

   
What do I need to know to become a manager for an affiliate associate program?

Managing an Affiliate Associate Program

Running an affiliate associate program is a lot of work. Be wary of signing up too many associates in the beginning—you'll need to work the kinks out of your system and make sure everything is running smoothly before getting too big. In order to be successful, try to:

• Get to know your affiliates as much as possible and find out what they want from you
• Study the results of your tracking programs and figure out which ads generate the most purchases and why
• Figure out which of your own site's landing pages lead to an improved conversion rate
• Make sure you communicate new programs and specials to your affiliates in a timely manner--keeping them happy and productive is your main concern

   
Is there a way to have an affiliate marketing program without spending a lot of my profits to pay associates?

Loyalty Programs For Rewarding Affiliates

If you want to start an affiliate program but have very slim margins, you may want to consider a point loyalty program or other reward program to recruit affiliates. For example, offering coupons for referrals or discounts or free products can create a small affiliate network for your company if you feel you are not ready to share in commission. Some companies offer discounts to those who bring in new clients which helps you not have to share margins but does rewards people who buy a lot of your product and are willing to help you spread the word.

   
Where should I advertise my new associate program?

Advertising Your Affiliate Associate Marketing Program

*You should make sure that your associate program is available on your web site.

Before you advertise anywhere else, treat your new affiliate associate program like a new product and make sure you have all the kinks worked out. Understand how you rank against your competitors' associate programs. Do you pay more, better, faster? Do your products sell better? Once you're ready to launch your associate program in a big way, you might find an affiliate conference to attend and advertise there. There are also newsletters geared towards affiliates and discussion groups--all of whom would make good candidates to advertise your affiliate associate marketing program.

   
Can I pay different affiliates different percentages of revenue share?

Revenue Share and Super Affiliates

Many affiliate programs set it up so that a higher revenue share is paid to the "super" affiliates. Basically, this means that affiliates who sell more are rewarded with a bigger percentage of each sale. This can be set up with multiple tiers to reward each progressive step up the chain with a higher percentage. This can also be done for specific time periods to encourage affiliates to make a big push and move inventory that needs to be moved.

*When you select affiliate management software make sure it is flexible enough to handle these set-ups if you think you may want a tiered solution at some point.

   
Should my profit sharing agreement be included in my business plan?

Profit Sharing and Your Business Plan

Your business plan should include your profit sharing plans and profit sharing agreement. You should have targeted commission levels and plans on how to grow your affiliate base. It is also valuable to include a mission statement and a marketing plan.

Focus your efforts on those products that make you the highest profit. Once you've written your plan, don't just set it on a shelf. Pull it out once a year and review it. Are you on target with your goals? What needs adjusting? Have business expectations changed? Update the plan each year.

   
How does profit sharing work?

Profit Sharing

Profit sharing is another term for affiliate, associate, referral, or partner programs. Basically, a web site that sells goods online agrees to share their profits with other web sites that sends customers their way. When a visitor from one web site clicks on a link that takes them to the merchant site and then buys something, the merchant site pays a commission to the referring site.

*There are a variety of profit sharing plans online. Before signing up for one, make sure you understand when and how you'll get paid.

   
How can I set up a revenue share that encourages my affiliates to sign up more affiliates?

Revenue Share in a Two-Tier System

In order to have two-tier affiliate revenue sharing, your affiliates need to have revenue sharing agreements with people who sign up from their web site. You would need to pay the 2nd tier affiliates the normal commission and the 1st tier (who initially signed up the 2nd tier) a small commission for each sale the 2nd tier affiliates make. This is basically multi-level marketing (MLM).

Strategically this method works because each affiliate has incentive to recruit more affiliates for you. The tracking is a bit more complicated than a straight-forward, single tier affiliate program but the benefits of this method can be profitable.

   
How do I get my associate merchants motivated to really work at selling my product or service?

Multiple Commission Levels Create Energy and Ambition To Sell

To get your associates or merchants working harder to sell your product or service, consider offering multiple tiers of rewards for their efforts to keep them motivated.

Having different commission levels based on the volume of sales, number of refferals or other reward programs can make your program something that your affiliates will focus more energy on.

Many of the successful programs that are out there attribute that success to having a progressive commission structure so that as the associate sells more products, their payout level increases or they earn additional rewards.

Keeping your associate affiliates motivated with rewards will help them focus even more energy on selling your product or service.

   
How should I set up profit sharing plans?

Profit Sharing Plans

There are a variety of profit sharing plans you can use as guidelines when you are setting up a profit sharing agreement. First, you'll need to decide whether you are going to pay for leads or sales. You'll also need to determine whether your profit sharing plan should include various tiers (paying different commissions to those who sell more for you).

You'll need to define minimum payment levels and how often you pay. There are also different methods of payment, which can be made by check, bank order, or through an online service like Pay Pal.

Make sure you have all of your ducks in a row when setting up a profit sharing agreement.

   
What does SEM and PPC mean and how do they impact revenue sharing?

Revenue Sharing, SEM, and PPC

Revenue sharing content publishers should optimize their web site using standard SEM (Search Engine Marketing) guidelines to attract more "natural" search engine traffic. This could help them to elevate higher in the natural rankings.

They might want to buy PPC (pay per click) ads for certain key phrases. These ads show up as "sponsored links" on search engine results pages. The search engines charge a fee each time someone clicks on a PPC ad. SEM can take 3-6 months to have an impact on where your site shows up on the natural rankings. PPC is a quick, but more costly, way to get at the top.

   
Shouldn't I sign up for lots of affiliate programs and put up lots of different ads so I'll make more money?

Affiliate Associate Marketing Program

*You'll be better off if you stick to a few associate programs that most closely tie in with your web site theme.

First, select a few high quality associate programs that match the subject of your site and sign up under their affiliate associate marketing programs. Next, create keyword-rich landing pages for those products you are trying to sell--remember to use text links as much as possible to link to the merchant site (they tend to perform better than graphical links) Finally, promote your site with search engines, a newsletter, online discussion groups, and through email by adding your web site URL to every message you send.

   
What is a two tier profit sharing agreement?

Profit Sharing: Two Tier Agreements

A two tier profit sharing agreement means that you make money not just from your own web site's affiliate marketing efforts, but also from anyone you sign up as a sub-affiliate.

Sub-affiliates are recruited by you and you receive a percentage of any sales they make on their web sites. Typically, the profit sharing plan will specify a larger percentage commission for first-level sales and a reduced commission for your "downstream" sub-affiliates.

   
How can I find out which keywords I should focus on for my associate program web site?

Keywords and Associate Programs

Selecting keywords is a bit of a science. You need to get into the minds of your prospective customers and figure out what phrases they'll type into search engines when they're looking for something like your site.

There are several services available at little or no charge that will help you research the best keyword phrases to use when optimizing your associate program web site. Look for phrases that are popular--but not too popular. There will be a little less competition if you select mid-grade phrases as opposed to ones at the top of the list. Make sure, however, that the ones you select still get lots of hits.

   
What kinds of things are sold with profit sharing plans?

Getting Started in Profit Sharing

Profit sharing is available for all kinds of merchants, from sports cards to books.

Most affiliates get started by creating a web site about something they are passionate about, like a hobby they already have. They provide useful content, newsletters, and other services to their site visitors. Once they realize they can make money by referring their visitors to trusted merchants, they research the different profit sharing plans and select a merchant with a good profit sharing agreement. Then, they add links to products or services. Once they are making some income in one niche area, they often decide to branch out and repeat their success in a new market by creating a different web site.

   
How does profit sharing differ from regular advertising?

About Profit Sharing Plans

Most businesses pay for services like advertising in advance. They design an ad and pay a newspaper, magazine, billboard or web site to display it. The display must be paid for whether or not the ad brings in any customers. Profit sharing plans, on the other hand, reduce the up-front cost to advertisers. Web site owners sign up to display the ad but only make money when site visitors do whatever task is defined in the profit sharing agreement. The agreement might specify that payments will be made for click-throughs, registration (leads), or sales.

   
Can I buy pay per click ads for a company name I don't own for my revenue sharing site, since I'm selling their stuff?

Revenue sharing agreements

Some revenue sharing agreements specifically either disallow or allow associates to bid on PPC advertisements using the merchant's name. Reviewing the agreements and terms of use is key.

Revenue sharing agreements can cover things such as:

• the use of graphics
• where and how to link to the merchant site
• content restrictions (such as adult or gambling sites)
• restriction of pop-up use
• restriction of the existence of trojans or viruses
• redirecting clicks

Know and understand your revenue sharing agreements.

   
How is syndication being used in affiliate revenue sharing programs?

Syndication and Revenue Sharing

Merchants can provide data feeds to partners of their revenue sharing programs. In addition, context oriented ads can be generated on the fly according to the page's content (so that ads can be updated more often with less effort).

Essentially, syndication provides an automated way of updating content, whether that content is an article or advertisements. Web sites become more dynamic this way, changing ads as content is updated. Publishers can send out content via RSS and XML and have it be updated in multiple places simultaneously.

   
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