If you’ve been in the ecommerce space for a little while, you’re most likely familiar with the term “affiliate marketing.” But many people aren’t quite sure what it actually is or how the process works. In its simplest terms, affiliate marketing is a performance-based marketing model that rewards affiliate partners for driving a desired action. These actions can include site visits, completion of a lead form and/or converted sales. This form of marketing can be an incredibly beneficial, low-risk way to promote your products.
To help you understand the real benefits of affiliate marketing, we’ve created a list of what we consider the top 5 benefits of affiliate marketing:
1. Performance-basedThe main advantage of having an affiliate program is that it is entirely performance-based. Because affiliates are only paid a commission once the desired action has taken place, they’re more motivated to drive the conversion you’re looking for. This mitigates any efforts that drive traffic with little to no value to your company while also ensuring that you get what you pay for.
2. Broader Marketing EffortsAffiliates can be found in every market and product category that exists today. Whether you’re looking to break into the retail industry or for something more niche like handcrafted vintage toys, there will always be relevant websites to align with. The great news is that many of these affiliates will already have an established visitor base. These partnerships grant the opportunity to expand out into new markets that you might not otherwise have had the bandwidth to explore or to further saturate your existing target markets, giving your brand a much stronger online presence. Think of these partners as an extension of your current marketing or sales team.
3. 3rd Party ValidationBy partnering with trusted bloggers and reputable websites, you can further the reputation of your brand and its products. These partners will champion your products and, in our opinion, will further solidify consumer confidence in your product or service. While in the research phase of a purchase, consumers are more likely to trust a 3rd party’s opinion over content produced directly from the site selling this product. Consumers also have a certain level of trust in websites they frequent for product recommendations.
4. Cost EffectiveFor many of the reasons listed above, affiliate marketing can be extremely cost effective. If you’re only paying commissions when the desired conversion occurs, you’re not throwing away ad dollars on placements that have no proven value. Furthermore, recruiting affiliates in new markets is an easy way to branch out into that market without the overhead cost of creating an entire marketing campaign, mitigating the need to sink money into an unproven market for testing.
5. Rapidly Scale TrafficIn conjunction with your other marketing efforts, recruiting affiliates to your program will allow you to scale traffic faster. The more sites that link to your pages, the more opportunities you’ll have to convert those users into paid customers. The other benefit of having these sites link back to yours is the added value search engines will put on your site. Essentially having outside resources link back to your site positively effects your search engine ranking, which will compliment your existing SEO efforts.
Affiliate marketing can be a very effective, low-risk investment to help expand your marketing efforts beyond a small business’ traditional bandwidth. For the reasons listed here, we believe affiliate marketing is worth the investment and can take your program to new heights.
Are you already utilizing affiliate marketing? How is it going? Feel free to reach out in the comments below with any questions or comments.