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affiliate compensation plan.
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Commissions, Competitors, Cookies & CPA’s.Forging the Right Affiliate Payout
Presented byJonathan Miller, CEO – ForgeBusiness USA Inc.
There are many factors that influence the success of your new or existing affiliate program.
Four of the most fundamental of these are:◦Your competitive Environment
(COMPETITORS)◦Your Customer Acquisition Cost Model
(CPA)◦Your Affiliate Commission Strategy
(COMMISSIONS)◦The length of time you track Affiliate Sales
(COOKIES)
This presentation assumes you’ve already taken a few significant steps in your online strategy:◦Selected the Network / Software
Platform◦Selected the Product Mix◦Defined your End Customer◦Identified an affiliate opportunity online
In order for an affiliate program to thrive / or even survive / it’s imperative that you have a well defined affiliate strategy that takes into account◦Your technology platform◦Your competitive environment◦Your Value proposition / Unique selling proposition◦Your marketing mix◦Your business imperatives (sales vs customer
acquisition◦Tracking options (primary and secondary affiliate
tracking
Affiliate Channel takes time to develop - not a magic bullet or last minute strategy.
Needs to grow to reach critical mass You will not have thousands of affiliates
sending you traffic Tracking does Fail unexpectedly Don’t underestimate launch costs It’ll take 7 months to hit ROI
Research your competitors Learn from competitors Research takes time and effort, but is a critical
to developing your strategy Join each of your competitors programs Send them traffic and understand how they
operate in order to improve or match their performance.
Resources and affiliate directories available online to help you find programs.
Programs fail when they go to market with either a too low commission and then try to raise it – or by going in with too high a commission and then lowering it.
Selecting your Payout Model◦Benchmark against competitors What are my competitors doing?
◦Use Internal Proven Marketing Metrics Affordability per sale / per customer acquisition /
per lead / per click / per impression
Affiliates and Merchants have an equal obligation Affiliates need to deliver valid, pre-
qualified customers You need to monetize the customers and
extract maximum share of spend.
◦Most programs pay either Once off Acquisition CPA Recurring Revenue Upfront CPA with recurring revenue
◦What kind of payout do you want to pursue? Does your product sell fast and deliver immediate
value for affiliates? Does the product have a longer sales cycle or is a
bigger ticket item? Can you share ongoing revenue with affiliates or
pay only for the introduction? What is your current cost per acquisition for new
customers? How much can you afford to share with affiliates
and how should you structure the compensation?
◦List active competitors◦Check inbound links & research affiliates◦Research top keywords and see who’s bidding on
those keywords◦Determine competitors affiliate payout◦What is their relative strength in the marketplace◦How dominant are they in terms of ad placement◦What are the Strengths and Weaknesses of their
program◦What opportunities and threats does this present
Varying reports that cookies track between 50% and 99% of all sales
Consensus amongst managers that cookies track well
Good affiliate programs offer redundant tracking Affiliates want lifetime cookies. Merchants can choose from a 1 day to lifetime
cookie Few cookies survive longer than a year - use a
LIFETIME identifier and assign the affiliate ID to the customer, so repeat sales are tracked without needing a cookie.
Other Factors that influence affiliate program success:◦Program platform selection & Setup◦Affiliate Recruitment Strategy and Targeting◦Affiliate Activation and Communications strategy◦Promotions, Special Offers and Affiliate Incentives◦Custom creative and Super Affiliate Content◦Real-time Tracking and Troubleshooting◦Payment Frequency
http://www.forgebusiness.com/?ppt
please visit:http://www.forgebusiness.com
US: 1-800-841-1369 / SA: 086-10-FORGE (36743) UK: 0808-234-7039 / CAN: 1-866-761-5644 DIRECT: +27-12-676-9360 E: [email protected]
