TOP 5 Reasons to Launch Affiliate Program
You should definitely start an affiliate marketing program for the following reasons:
1. Aligns with campaigns in other channels
Affiliate marketing compliments your overall marketing strategy and can strengthen your performance in other channels as well. It also requires budget, time, and effort, and can’t entirely be considered a substitute for your existing marketing programs, but launching an affiliate marketing program can help you achieve the highest possible profit margins, as many other brands have already discovered.
2. Works well with PR
Another good reason to get started in affiliate marketing is that affiliate marketing and PR campaigns can be integrated to achieve better results. Affiliates can boost brand awareness and provide content, while PR helps you further expand presence through media outlets, placements, and branding.
3. You stay in control
From picking out affiliates you want to work with to setting commission rates, a lot about affiliate marketing can be customized according to your goals and budget. You decide to grow your campaign at a rate that you can manage and are comfortable with.
4. Partner with trusted publishers
About 49% of consumers
depend on influencer recommendations when making buying decisions. Publishers already have esPartner with trusted publishers
tablished followers whose trust they have earned. With the right affiliates working for your brand, you break a lot of barriers and are able to reach customers more easily and effectively.
5. Affiliate marketing benefits SEO
Apart from the profits that an affiliate marketing program can bring, another huge advantage of getting into the program has something to do with your brand visibility. With publishers sharing link referrals to your website or ecommerce store, you generate a lot of backlinks, which is among the factors that search engines consider when ranking your site in the search engine page resuts. You won’t just be getting backlinks--you get high-quality backlinks from established publisher websites, which creates a positive impact on your own web rankings.
TOP 5 Reasons to NOT Launch an Affiliate Program!
Now that you’ve known about the top five reasons to start an affiliate marketing program, here are another five reasons why you should not:
1. Your website is poorly designed
The success of an affiliate marketing program heavily relies on the functionality of your website. If you have broken links, missing content, poor site speed, cluttered pages, and confusing navigation, you are more likely to drive customers away than win their sale. Before you can actually consider affiliate marketing, you must have a website that’s unique and functional with attractive and engaging photos, videos, descriptions, and all the information that customers are looking for.
2. Wrong type of product
Affiliate marketing programs are available on a wide range of verticals, but there may be some rare cases when you’re better off capitalizing on other marketing channels other than affiliate marketing. For instance, you may reconsider an affiliate marketing program if you have:
Low AOV products. It's hard to make money on low AOV products. Affiliates often stay away from promoting them or in the event that they don’t, they opt to promote them through marketplaces, which can be highly competitive and thus, not very ideal
“No brand name" products. If you don’t have a strong brand to market at this time, your products are probably best for marketplaces like Amazon, Walmart, eBay, Etsy, etc. Brand awareness is an important aspect of affiliate marketing.
Products with existing poor reviews/reputation. Bad reviews can be hard to recover from so if you’ve been hit by this kind of problem, it won't be the best time to try your hand in affiliate marketing. Publishers choose brands they affiliate with carefully because they’re also maintaining a reputation. You’re better off making an effort to improve your products.
3. You don’t have a budget
Affiliate marketing programs require a team and a budget, just like any other marketing program. Some expenses to consider include:
An internal team or agency to run the program. An expert should run/assist with your affiliate program.
Commissions. Understanding your product margins is important as it will help you to properly calculate your publisher commissions. Commission for traditional DTC products generally varies from 1% to 30%, with some exclusions, based on publisher type. An average of 10% is quite common.
Other Expenses. Network FEES are charged by affiliate marketing networks (integration fee, monthly management fee). Additionally, CPM, CPC, and flat fees are charged on top or instead of the traditional CPA/CPL model, depending on the publisher. Some publishers charge for the integration, others charge extra flat fees on top of CPA (common for content).
4. You have unrealistic expectations
If you expect instant profits that’s not what affiliate marketing is. As in all marketing programs, it is an investment that takes time and optimization. Expect to make some mistakes along the way before you can get it running smoothly and profitably.
Time. If you expect your program to be a huge success in 3 months - think again.
KPIs. If you are looking for numbers that are impossible to achieve (ex. New vs Existing, Amount of Orders, Revenue, ROAS, etc) - the program will not succeed. Do some research on what is considered realistic for your budget or type of product.
LOW CPA. How competitive/attractive is your product for affiliates to choose to promote it? CPA is especially important for content and premium publications, as well as influencers. Your product can be amazing, but guess what - they will promote your competitor if they pay more commission.
5. You don’t have a dedicated team
If you are a CEO or a business owner planning to launch an affiliate marketing program without a dedicated team or an expert, you better rethink it. It’s true that almost anyone can set up an affiliate marketing program but managing it is an entirely different thing. It’s a continuing process that comes with challenges and a lot of changes. You need someone to manage your programs, address industry-specific challenges, monitor your performance, and update your campaigns to help you take advantage of new opportunities that open up.