Saying the words ‘Pay for Performance’ to an online retailer is a surefire way to get their undivided attention . For this reason, and other buzzwords such as blogger outreach, an affiliate marketing program frequents many online store marketer’s checklists. Simply put, affiliate marketing is a marketing channel where you, the retailer, only pay your affiliates if your desired and defined outcome (sale or lead) is achieved. Sounds like an entrepreneur’s or investor’s dream! In fact, affiliate programs reach, and often exceeds, the desired results, but is your store ready to deliver the promises required to make it a success?

Affiliate marketing programs are a strong and powerful tool. However, it is not for every business. So, how do you know if your online business is ready for an affiliate program? First let’s start by dismissing some common affiliate marketing myths.

Affiliate Marketing Program Myths 

1)      There is no initial investment to set up an affiliate marketing program. An initial, and continued, investment is essential for a healthy affiliate program. Programs need tested and converted banners and landing pages. Affiliates need a reason to promote you which means customer and/or affiliate bonus programs.

2)      Affiliate marketing programs generate tons of sales. The easy answer is, yes it does. My affiliate programs generate 10-20% of existing online sales for my clients. However, if your store generates only one sale per week, you will get 10-20% of one sale per week. You are not ready to launch an online affiliate program! It is crucial to have a performing store before you begin. Affiliates provide qualified traffic but your store needs to be in a position to convert that traffic.

3)      Affiliates are great for my brand.  There is truth to this statement. However, affiliates do not make a living promoting your brand. They make a living promoting a product that sells. Brand focused collateral, no matter how ‘cool’ the creative is, is not what affiliates are looking for. Sales focused banners that convert are!

4)      Once I have my affiliates, affiliate management is easy and low maintenance. Nothing could be farther from the truth. Auto run affiliate programs are a petri dish for abuse and stagnation. Abuse in this channel costs you money.

Now that we’ve busted some of the myths, answer these four questions to determine whether your online store is ready for an affiliate program.

Affiliate Program Marketing Questions

1)      Has your online store been open for at least one year? If the answer is no, your conversions may not be high enough for the affiliates to earn a healthy commission. Test, test and test some more before you launch an affiliate program. First impressions are critical in this industry.

2)      Is your average order size a minimum of $30? Ideally, it should be higher, but volume can make up for smaller order values. If you have a small order value, you can focus on higher payout per sale to compensate for the lower average order size or allow reoccurring commissions.

3)      Do you have enough profit margin to offer your affiliates a solid commission and/or a customer incentive? Merchants who offer a coupon or a “gifts with purchase’ create for higher conversions. Higher conversions translate to higher commissions so affiliates are naturally drawn to these offers. Please note, including these types of customer incentives does not mean your program should cater strictly to frugal living/coupon or loyalty sites. These offers provide value to content/niche affiliates.

4)      Do you have the resources to properly run the program? Affiliate management requires daily attention. A successful program includes an extensive outreach program regular internal communication with existing affiliates and monitoring.


Still not sure if your store is ready to take the plunge into the world of affiliate marketing? I can help! I will review your store and provide feedback. Together we can sort through the challenges and many rewards of affiliates.  I can be reached here or via LinkedIn.

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