I think you’ll agree that running your own affiliate program can be one of the best ways to generate new customers and increase revenue for your business.
But setting up a proper affiliate program is insanely complicated and expensive.
…or is it? 🙂
In this post I’m going to share 7 ridiculously simple steps that I’ve learned over the years (as both an affiliate and a vendor) that can help you test and launch your very own affiliate program quickly, with minimal effort and monetary investment.
Affiliate Disclosure: I may receive a commission if you purchase one, or several of the products I recommend here.
Now let’s get this party started!
1. Have a great product
Nothing will backfire in a more epic fashion than running an affiliate program for a crappy product.
Think about it…
Affiliate marketers make their living by using, reviewing, and sharing their thoughts about various products and services.
The honest marketers (who are the ONLY people you want promoting your products) will be merciless in their assessment of your offer. As they should be.
People trust the opinions of their thought leaders, and it’s never worth it to erode trust with one’s audience by promoting something you don’t truly believe in just for some quick cash.
I want to encourage you to release only your absolute best stuff, and hold both yourself and your products to the highest standards you can muster.
It’s the best business strategy in the world.
Furthermore, from an affiliate marketer’s perspective, a great product is a million times easier to promote because it’s something you can truly believe in and talk about with genuine enthusiasm, especially if you use it yourself.
This emotion comes through in promotional efforts and makes all the difference.
2. Be selective in who you allow to promote your products
I want to share a strange (but true) story with you…
The very first business I attempted online was selling an information product on how to sing opera (I studied classical singing in university).
And most of the “gurus” in the info product space at the time recommended putting your product on the ClickBank marketplace because it would automatically attract affiliates that would then promote your product.
Little did I know, simply allowing anyone and everyone to promote your product is not such a great strategy.
For one, several of my affiliates wound up outranking me in Google for my target keywords. Shit.
Second, many of my affiliates used spammy and shady methods to blast their affiliate links all over the interwebs. Double shit.
The thing is, this species of lazy affiliate doesn’t add any value to the landscape.
They just pimp affiliate links in the hopes that some tiny percentage of folks might buy a product and earn them a commission.
Unsurprisingly, this “spray and pray” approach rarely works.
People aren’t stupid and they can tell when a product review is genuine or not.
They can tell if the person promoting a product cares about them and their success, or if they just want to make a quick buck.
This leads to an interesting point:
Have you heard of the 80/20 rule…?
Also known as the Pareto Principle, this rule states that 80% of your results come from 20% of your efforts.
But in my experience in the affiliate marketing world, the distribution is skewed even more radically.
Here’s the reality…
You can expect about 95% of your affiliate revenue to come from just 5% of your affiliates.
I repeat: 5% of your partners will drive 95% of your affiliate sales.
That means that basically a small handful of people who have great relationships with their audiences, and who genuinely believe in your product, will drive almost all of your affiliate revenue.
The rest of your affiliates – who have little or no relationship with their audiences (or have no audience to begin with) – will simply cast their affiliate links out into internet land and “hope” for a sale or two.
These are the people who you do NOT want promoting your products!
They won’t make you any money, and in the process of not making you any money, they may even injure your reputation and pollute the search engine results with their low-quality posts.
That’s why it’s important to have an application process for your referral program where you actually ask your prospective partners HOW they plan to promote your offers.
This process is not a mere formality…it’s an effective filter for poor partners.
You may even want to go so far as to insist on a Skype call to get to know your affiliates before you decide whether or not to do business together.
Some companies, like WPRocket (whose software we use and love), go to an even further extreme.
How could that be…?
Because they intentionally do NOT have affiliate program!
They’re so concerned with their reputation that they don’t want anybody recommending their product unless that recommendation is genuinely motivated by a love of their product, and not by the prospect of earning a commission.
Edit: As of mid 2018, WP-Rocket has an affiliate program.
This is a totally understandable position…
Because no matter how much you’d like to think you’re impartial, honest, or incorruptible, the whiff of money has an intoxicating effect upon your objective faculty.
But on the other hand, an affiliate program can help you massively grow your business.
So I take the middle road when it comes to this topic.
I DO recommend that you run an affiliate program, but I do NOT recommend selecting your partners willy-nilly.
In fact, a “partner” is exactly the right term to describe who you want to promote for you; NOT an “affiliate”.
If you approach your referral program from this perspective, you should be able to benefit from this incredibly powerful growth channel without injuring your reputation or credibility.
3. Provide your affiliates with kick-ass resources
The name of the game in business is making other peoples’ lives easier.
That’s why I made you this resource, and hopefully you’re reading it and feeling all sorts of warm and fuzzy feelings for me as a result. 🙂
This rationale extends to your referral partners…
The more you can reduce friction – the easier you can make it for your partners to promote your product – the more successful you both can become!
Typically you’ll want to provide one, or several of the following kinds of resources to your referral partners:
- Plain text links
- Pre-written email “swipes” (email campaigns that sell your product over the course of several emails)
- Brandable lead magnets (for example, I could provide you with a version of this checklist that contains YOUR branding and contains YOUR affiliate link, so when you give it away to your audience and they go through my funnels and wind up buying a product, YOU will get credited with the sale)
- Shareable images / infographics (Pinterest and Instagram are HUGE…use them!)
Don’t hesitate to get creative and provide ANY kind of resource that your partner’s audience might find valuable, regardless of how unusual the format might be.
In fact, being unorthodox in your approach when most people are engaging in – pardon my language – a giant circle jerk, can get you the kind of positive attention that following the herd cannot.
Think outside the box and try using mindmaps, “resource toolkits”, video series, quizzes, and so on.
Most affiliate platforms will make it easy for you to upload and display these various resources to your affiliates, and provide them with tracking IDs so you can both see which of the resources convert the best.
4. Run contests / giveaways with leaderboards
One of the most effective methods I’ve seen vendors use to encourage their affiliates to hustle harder is to offer sexy prizes to their best-performing affiliates.
It’s not uncommon for the vendors of a large launch to give away some serious swag…
- All-expenses paid vacations
- First-class international flights
- Big-ass cash prizes
In fact, Russell Brunson – who built his company ClickFunnels to nearly half a billion dollars without ANY outside funding – runs his affiliate program with the unique angle that he’ll make the first down payment for your dream car if you refer 100 customers to ClickFunnels through their affiliate program.
How cool is that?
And guess what’s happened as a result of Russell offering such a generous reward?
That’s right: a bunch of his affiliates now own baller cars paid for by ClickFunnels.
A good affiliate platform will have this contest and leaderboard functionality built in.
But if you’re on a shoestring budget, it’s not terribly hard to simply whip up a spreadsheet and track it yourself.
It’s certainly better than NOT taking action for lack of a “proper” app. No excuses!
But why do affiliate contests work so well…?
My hypothesis is that contests and giveaways have a viral nature that brings out the competitive spirit in people.
As long as you’ve picked your partners carefully, this competitiveness will manifest itself positively and result in all parties involved winning.
Additionally, having influential partners on board to help you promote your offers creates a certain amount of hype that can help you gain traction.
This works particularly well for launches.
However, the good news is that thanks to all the awesome technology available today, you can create your own “evergreen” launches.
This approach tends to convert extremely well because launches give your product a sense of scarcity and exclusivity.
This in turn benefits your partners who make more money from their promotional efforts.
And of course it benefits your customers, whose problems your products and services are solving. 🙂
Pro Tip: To easily set up your own Evergreen Launches I recommend using the OptimizePress plugin
5. Provide the most generous commission you can afford
Why do affiliates promote your stuff…?
Is it because they like you and think you have a pretty face and just want you to be happy?
No way, José!
They’re in business to make money, cashola, moolah, dinero. Simple as that.
So if you offer a paltry 15% commission on your products, what incentive do your partners have to do a ton of spec work just to earn a pittance?
Because that’s exactly what affiliates do, you know…
They basically work completely for free (and often at their own considerable expense) and ONLY get paid IF and WHEN they finally sell your product.
If you’ve ever done any affiliate marketing before, you know that it’s damn hard work that carries absolutely no guarantee of success.
Therefore, as a vendor, it behooves you to put yourself in your partners’ shoes and make it worth their while to promote your stuff.
The industry standard is at least a 50% commission on information products (most people offer 75%. or even more).
Often, this percentage carries through to ALL of the products in an info-product funnel, and includes recurring payments on continuity offers.
For SaaS companies, depending on their margins of course, you’re looking at around 30%.
For services and physical products, you’ll be at 20% or lower.
The main thing to keep in mind is the long game.
Even if you LOSE money on the front end, you’ll still profit over time.
That’s why it’s so important to know your key numbers like Customer Lifetime Value (LTV), Cost of Acquisition, Earnings Per Click (EPC), etc.
Without knowing how much you’re able to spend to acquire a customer – whether it’s through paid advertising, your affiliate program, or any other marketing channel – you’ll be flying blind.
Once you know what a customer is worth to your business, and once you know how much you can spend to acquire him, you can then use a data-driven approach (instead of the voodoo that most people engage in) to put together a generous affiliate package for your referral partners.
These people are helping you take your business to new heights. Treat them like gold!
6. Try it before you buy it (an affiliate program, that is)
Don’t take it as gospel that you absolutely NEED to have an affiliate program.
A lot of people don’t realize that an affiliate program is simply a marketing channel.
And not all marketing channels work for every kind of business equally well (or at all).
So just as you would (hopefully) take the time to validate the strength of a business idea before diving in and building your product, you should likewise first dip your toes in the affiliate pool to see if it’s a viable strategy for your particular business.
(This is the approach I learned in one of my favorite business books, Traction: How Any Startup Can Achieve Explosive Customer Growth. This book was recommended to me by Russ Perry from DesignPickle. Thanks Russ!)
There are several free or cheap affiliate plugins for WordPress that you could install and configure to set up a really basic affiliate program.
You could then invite a small beta group of friends, influencers, and subscribers from your list, to run a pilot affiliate promotion for you.
If it’s successful, good; idea validated.
If it’s a total flop, it may be better to defer this particular marketing strategy for a later time when you have a better product, a bigger audience, better margins, and better relationships with the people who will (eventually) become your partners.
In the case of several of our productized services – MemberFix in particular – we tried running an affiliate program only to find that our business wasn’t yet efficient enough to offer decent commissions to our partners without wiping out our entire profit margin in the process.
In other words, a referral program wasn’t really working for us at that point.
Over time, as we’ve grown and learned to manage costs and maximize revenues, we’ve become able to entice our referral partners with better commissions without cannibalizing all of our cashflow.
7. Use a best-in-class affiliate management platform.
Once you’ve determined that an affiliate program is for you, don’t be shy to invest in the proper tool to run it.
Professional affiliate marketers are very meticulous when it comes to tracking and they tend to be picky about their platforms.
As well they should be…
In fact, many professional affiliate marketers will categorically REFUSE to partner with you if you don’t use a platform they trust.
There are TWO affiliate platforms that we use and love, and which are widely accepted by affiliates.
ThriveCart is actually a powerful shopping cart app that we invested in for our business in early 2017.
At the time we really couldn’t afford it but I couldn’t say no to the Lifetime deal they were running (which is still open as of this writing, though it may be closed by the time you read this).
So I somehow found the money and made the investment.
I’m very happy (and relieved!) to say that ThriveCart easily paid for itself in the course of a few months, and has proved to be one of the best pieces of tech we’ve ever worked with in our business.
One of the reasons I plunked over the $600 for ThriveCart is because it has a powerful affiliate management module built right in.
That means that we can not only sell our products but we can also manage our affiliate program for those products from within the same platform.
ThriveCart’s closest competitor, SamCart, charges an extra $100 PER MONTH for access to their affiliate module.
Given the alternatives, maybe you can understand why I felt that a one-time payment of $595 for LIFETIME access to ThriveCart, which already includes an affiliate platform, was a deal that I had to act on.
If you need BOTH an affiliate program AND a shopping cart, ThriveCart is an excellent choice.
*Note: ThriveCart is not affiliated with or related to ThriveLeads or ThriveThemes in any way; they’re two completely separate companies run by different people (ThriveCart is the brainchild of Josh Bartlett of Easy Video Player fame, and ThriveThemes / ThriveLeads are Shane Melaugh’s products).
Incidentally, they’re both top-notch companies.
I’ve worked with iDev extensively and I’m amazed by its flexibility, completeness, and ease of use.
I’ve also worked with competitors like AffiliateWP, TapAffiliate, ClickBank, and others.
And while there’s nothing wrong with those solutions, I feel that iDevAffiliate is simply the best piece of tech for the money.
iDev offers multiple tracking methods and the tracking and integrations are flawless.
It works hand in glove with one of my favorite membership plugins, MemberMouse, and plays nice with dozens of other tools.
iDev offers both a cloud-based version of their platform for a monthly fee, and a self-hosted version that you install on your server for a one-time fee (although like most software, you’ll have to pay a yearly support fee to get upgrades and support)…
I prefer the self-hosted version because it’s less expensive and well, self-hosted!
Bonus Step! Be mindful of legal and compliance requirements…
*This is not legal advice. I’m not a lawyer. Nor do I play one on T.V.
Please do your due diligence and engage a lawyer if you decide to go all-in with your affiliate program. 🙂
Hopefully this is obvious to most people but things like not paying your affiliates, or clearing their cookies on the checkout page, or changing affiliate platforms without notifying your affiliates so they can update their links – any of that kind of stuff – is totally and utterly illegal (not to mention shitty).
You can get easily get sued into the poorhouse and lose your entire business if you don’t approach your affiliate program professionally.
One particularly infamous example follows…
In 2013 the creator of one of the most successful dating advice products ever sold – “The Tao of Badass” – got eaten alive on the Warrior Forum when evidence surfaced that suggested he’d been screwing his affiliates of out sales.
So definitely don’t do anything shady, and make sure to get all of your legal and compliance ducks in a row.
Also make sure that your affiliates know that they’re required by the FTC to disclose any affiliate relationships they may have whenever they promote a product.
Here are some resources for you to get started (make sure to edit them to reflect YOUR terms):