Free Trials and Affiliate Programs: Should you pay commissions on free trial accounts?

Free Trial Commissons

If you have a Software-as-a-Service company, you most likely have a free trial option. At some point in time, you might have considered compensating affiliates for driving free trial signups.

Much of this thinking comes from a basic hypothesis I hear a lot:

You believe there is a correlating relationship between compensating an action to an affiliate, and a affiliate providing more traffic (thus increasing the probability of more trial signups, and potential upgrades to paid accounts – in the long run).

While certain affiliates very well could operate this way – a vast majority don’t. On the whole, there is not a direct causation relationship between compensation and the ability for an affiliate to drive more qualified leads to sign up for a free trial account. It’s much more nuanced than that.

So, should you compensate affiliates for free trial account signups? In an overwhelming majority of cases, The answer is: NO.

Why? In my experience, when managing an affiliate program that compensates affiliates on free trial signups – the outcomes and takeaways usually are:

  • You will get an increase in traffic and sometimes an increase in affiliate applications. However, given our experience: 95% of the increase in traffic (as well as new affiliates) won’t and don’t lead to higher paid conversions.
  • You, as merchant/advertiser, have to be more rigid on verification of those commissions – which ends up taking more time than the ROI it produces (AKA total amount of revenue derived from all trial accounts upgrading to paid accounts). Additional verification also increases support volume since many of those affiliates just try to turn a buck, want to know why verification is taking so long.
  • Qualitatively (and to point #1): The top affiliates I have worked with often don’t have interest in a lower commission rate free trial. They are interested in driving paid accounts (which is good: as it aligns, or should align, with your company goals for the affiliate channel) as it results in higher commissions and more impact for both parties.

Stuck with Free Trial Option

Stuck free trials

But what if you ONLY have a free trial option? Meaning: A new prospect/customer must signup for a free trial account and then upgrade to a paid account. Should you compensate affiliates on those free trial signups or just when they upgrade?

This is a case, separate from this question (and a topic I will cover in detail in future posts), where your company hasn’t aligned for a Cost Per Action (CPA) consideration for affiliates.

In other words, you are doing a disservice to affiliates if the only way for an affiliate to drive a paid account is to force them to drive a free trial signup first. Almost all affiliates want to ensure they get the commission for referring a paid account, so any impediment to that is going to lower confidence.

Long story short: you should offer the ability for a new prospect to either a) signup for a free trial (and upgrade in the future) OR directly buy an account from your website. Then the affiliate can choose how he wants to drive leads or paid prospects to your SaaS business without being locked in.

Curious to know your experience and opinion. Thanks!

What fields to include in your Affiliate Program Signup Form.

Your affiliate signup form, the form a affiliate partner/publisher must fill out in order to be considered in your affiliate program, Is the starting point with your relationship to them as a merchant/advertiser.

Often times, depending on who’s in charge in the company, what affiliate platform the program is run on (perhaps a myriad of other factors) and so on: There isn’t a clear answer on what you need to collect from affiliates upfront prior to this consideration.

Given our knowledge of working on many programs in the past and present, of which, have had anywhere from an email address and a name field to long, multi-step form: Our goal is to find the balance; one that converts the right kind of affiliates for your program reguarly but also gives you (the merchant/advertiser/affiliate manager) enough information to know how the affiliate is going to promote. So, Let’s get to it!

The Long form vs. short form double-edged sword:

SaaS Affiliate Program Form

There is often an initial emphasis, on behalf of you the merchant/advertiser, to collect ALL the information upfront. More data captured, the more we can do with – right?

The opposite might be true as well – if we only collect two or so fields, won’t we be missing valuable information that allows us (as a merchant) to understand how they intend to promote?

That is why we select a balance: Only capture what is truly needed upfront in order for them to promote.  A form with 5-7 fields is ideal in striking this balance. But what are the specific fields to use?

The Affiliate Program Signup Form Fields you should have:

Below, are the form fields we believe should be the tenants of every affiliate program signup form (in order of importance) – and why:

  • Email Address – first and foremost. If they don’t complete other actions in your panel/affiliate platform, there is really no effective way to communicate with them beyond an email address. Equally, if they don’t finish the affiliate signup form – you can capture them and setup re-abandonment campaigns (more info on this to come in future posts).
  • Full Name –  Not only for Terms and Conditions acceptance but also so you can personalize any emails and future communication to them.
  • How they plan to promote your products/platform/brand – This should be an open-ended question. You can derive a lot from a potential affiliate partner’s own words on how they plan to promote your services. This is really important. I only find a small number of merchants actually ask this question, and even less merchants that don’t actively do anything with this information.
  • Website (URL) – Some might argue, having a website is not technically a prerequisite to promoting a specific product or service. However, we have seen a huge correlation; 93% of the mid to top level affiliates we work with, have a website.  This also allows you to gleam more data from their website on how they have promoted other products and services in the past.
  • Self-identifying questions – Each affiliate is different, but often can be correlated to a certain category. What do I mean by this? Popular categories really depend on the type of business, but here are just a few: Coupon site, Media Publisher, Blogger, Loyalty site/Rewards, marketing agency, and Digital Marketer/Coach. These categories can be a selection box which will allow you to segment your affiliates and send communication that is important to them(vs. generic affiliate program information).

What about Terms and Conditions? Yes – active acceptance by each affiliate partner is crucial in your program. More information on this on our post, “5 Things You Should Have in your Affiliate Welcome Email”.

But what about Tax Info (for U.S. Publishers)? Shouldn’t I collect upfront?

SaaS Affiliate Program Tax

This goes without saying: The Up Foundry is not and can not provide legal or tax counsel to you or your business. Prior to acting on any of the below information, please seek the appropriate legal or tax professionals for your business and/or industry. 

If there is a high fraud risk in your affiliate program (think credit card affiliate programs) – then yes, I would add this. It truly is contingent on your type of product/service/good and an independent decision you must make.

However, most SaaS-based affiliate programs, must collect this information prior to the first commission payout. This goes back to what is needed and when; In most programs tax information isn’t needed upfront because affiliate partners signing up might not even refer a customer. By adding this information, it only creates a barrier for affiliates start promoting.

This is also why extra fields would be omitted from the form (like city, state, etc.) because you would collect these information (and it will likely be more accurate since there are tax implications) at time of tax document collection.

Anything else to consider?

You might run into limitations set by whatever tracking platform you used to manage your affiliate program. For example, if they require a certain amount of information to be collected on the form (or if the form is not editable), you might not be able to test this.

Also consider any spam implications; the shorter and more basic your form is the greater chance is left open for bots and crawlers to spam your form. So be careful.

Finding Affiliates to Promote your SaaS Company

If you’re like me, after an affiliate program launch or when you are researching how to grow an affiliate program that has been up and running for awhile – you might consider finding affiliates to promote your services. 

But how do you do it? Especially for a Software as a Service Company? There is not a manual or easily adoptable game plan to run to. It takes a lot of creativity, testing, hard work and timing.

I’d like to break down all the ways SaaS founders, CEO’s, Marketing Managers can find affiliates to promote their product or service effectively.


Promoting your SaaS affiliate program:

Pixabay

This includes some of the many strategies you might have already done. However, here is several ideas you can easily execute:

1) To your customers –  On your website/application you can:

  • put your affiliate program signup link in your footer or top navigation of your website.
  • Add your program signup link in your company email autoresponders: think invoices, newsletters, action oriented email triggers; essentially, where it makes sense.
  • input an accessible link or prompt within your application (after they have logged in).
  • promote the affiliate program to your returning customers, on your app login page.

2) On Affiliate Program Ranking Websites, Directories or Forums:

While this won’t get you loads of affiliates, given you are competing with other affiliate programs, it is true that communities focused around affiliate marketing are always looking for new offers to promote.

Here are some areas you should add your affiliate program to:

3)Through aligning partners or services (co-marketing)

Say you are a web hosting company and you are trying to promote your affiliate program. You could reach out to partners so that they could reach out to their affiliate partners. For example, Perhaps your partner is a Content Delivery Network (CDN) and they have affiliates promoting their CDN service. They could send out an email to their CDN affiliates saying, “ABC web hosting company is offering a special commission rate to promote their web hosting service along side your promotion of CDN.”

Thinking outside of the box of the traditional ways of getting reactive affiliate sign ups can go along way of growing your affiliate program.

4) Sales or Account Management Affiliate Leads:

Your front line sales and account management team can mind you gold in terms of prospects or new customer’s that might be a good fit for your affiliate program. Why? They talk to potential prospects – even if they don’t end up using it themselves, their business could benefit from promoting you.  But how?

Say, you’re a help desk SaaS software company. One of your Sales Executive’s talks to a enterprise customer that mentions – ” We are going to be an enterprise customer of yours, but we also are thought leaders in the customer support tech. space – and teach others how to best support their customers through strategies and tools”

Now, the customer didn’t explicitly say the words, “affiliate” -which is often where a Sales member might not think anything of it. You, as the CEO or founder, can create a referral incentive system that rewards the sales team member for sending your marketing manager or affiliate manager a lead. if the affiliate signs up and refers sales/commission – the sales member would get rewarded.

I believe there are so many missed opportunities in here; even if the prospect doesn’t up for your product or service initially – there could still be a business case for him/her to promote it. You just have to explore those opportunities.


Proactively finding individual SaaS affiliate marketers:

rawpixel.com

We are going to spend a lot more on proactive or outbound finding/recruitment of affiliates. Why? This is often the biggest question mark that SaaS founders come to me, trying to understand. The dissonance (I believe) is in the notion or question: ” How can some one who is not a customer or does not know my product – be an advocate and marketer of my product and service?”

To that, I always say: It’s about the unrealized value from both parties (your SaaS company and the affiliate partner/publisher) that you present to them. 

5) Review or ranking websites:

This can range from small publisher sites all the way to Tech review websites – like PcMag.com, TopTenReviews.com, and Reviews.com.

I group these together as many of these websites have a review of your product and then they rank these providers (per category/industry) on a separate industry page with all your competitors. These are not mutually exclusive meaning – Your review can have little or nothing to do with how you are ranked on the website (this can be a moral conflict -I realize). 

You might be skeptical and think a lot of these website are only going to want: flat fee ad placements, super high commissions, or very specific cost requests.

Not always the case. 

In my experience, a lot of these review websites are willing to review your product/service and work off an initial CPA (commission) basis. If they send good traffic and you can garner them a good conversion rate – there more likely to negotiate a higher ranking placement (as if: they are getting paid $20 per referral and only getting 10 from your competitor, vs. $10 per referral but conversion rate is higher getting them 100 customers a month).

6) Organic Ranking Combinations & How To’s (Long tail):

Beyond the simple “Review” appending your software or industry term, there is could also be a lot of long tail industry terms or phrases that could be good affiliate prospect/potential.

Take  for example, If you have a VPN affiliate program. Seeing popular searches like, “how to setup a VPN” heads good publisher results:

A good brainstorming exercise to get you finding opportunities is:

  • Go through your help articles or boil down the common things that your customers say why they love your SaaS service.
  • Google search variations and see what comes up as tops ranking articles, websites, or blog posts.
  • Make a list to see if those publishers as possible affiliate prospects.

7) Competitor affiliates & deeper backlink Research:

Another way to look at growing your affiliate program with high performing affiliates, is looking at other competitors. No- I am not talking about stealing affiliates from competitors; that is highly likely to backfire since those affiliates probably have good familiarity with your competitor’s products and services.

However, some affiliates that promote one product or service can sometimes promote a competitor. This is in the form of:

  • Industry RoundupsFor example: Top 5 email marketing providers reviewed
  • Competitor vs. Competitor: Leadpages vs. ClickFunnels -who is the best?

It’s likely that these type of pages are affiliates of multiple affiliate programs. If there are industry roundup posts that you are not on – I would approach them and see if there is a possibility to be reviewed and added in the future or work with them to see what is possible in the future.

You can also look at some aligning content that is well ranked and see who are the top referring URL’s to this content. Using SEO tools like ahrefs.com, provide a gold mine of backlinking and even redirect referring URL data.

8) Affiliate Networks:

This is reserved for SaaS companies who want bigger “network” effects beyond their internal affiliate program and have the budget to pay for it. Running aligning affiliate programs on networks like CJ.com or ShareASale.com, can be quite successful for:

  • SaaS companies that have a broad customer market (reasonable price, not a lot of prerequisites to be a customer, etc.).
  • SaaS companies that can support localization in other markets (for example: Latin/Spanish, German, etc.).

Please Note: There is often a common misunderstanding that, going with a network is good because, “that is where all the affiliates are at.” Not necessarily true. A network is good for some SaaS companies but cost prohibitive for others. Also – networks have a lot of restrictions between Advertisers (your SaaS company) communicating with Publishers/ Affiliates so the ability to recruit good affiliates can often be tough.

9) Conferences:

Targeted conferences are some of the best ways to develop relationships with others that might, in-turn, develop into great affiliate partnerships. While, obviously, the upfront cost to attend is high, I have found that the longtail of getting to know somone you have meet face-to-face sometimes trumps all other forms of active recruiting or finding affiliates.

The key is targeted conferences. Many conferences that are industry based just have a bunch of vendors or other Advertisers trying to do the same strategy. Some great conferences that heed good relationships (in my opinion) are:

Here are some others provided bt Affiliate Guide: http://www.affiliateguide.com/events.html

10) Running Facebook Ads & Retargeting

This is one strategy that I believe is truly under-rated and that many Advertisers are not even doing. The idea is simple:

  1.  People come to your affiliate information/signup page
  2. If they don’t sign up for your affiliate program
  3. You run retargeting ads promoting the affiliate program to these individuals to get them to signup.

What kind of benefits does this create?

By marketing your affiliate program (perhaps using different mediums or value propositions beyond the commission structure), you can pique someone who has already had intial interest in the program, to convert to become an affiliate. A good example I have noticed is: ClickFunnels. They give you an onslaught of information on their affiliate signup page and then retarget you with a campaign on Facebook talking about how to: win a sports car by being a top affiliate of theres.

Another option is to take Create a Custom Audience  (look-a-like audience) with Facebook Ads, by using the information you have on file with your current (preferably top performing) affiliates. Essentially, if done right, can attract more of the same type of affiliate performers.

11) Ask your Top Affiliates:

This can have great success: If you do it right. You do not want to come off as creating competition for your top affiliates (by bringing their friends or colleagues into the mix) and you don’t want to create an MLM option (these often never lead to success for all – just widens the gap between top performers and those underneath and can be an absolute mess). 

However, if you ask them about what conferences they attend, what groups they are a part of — in a way the promotes learning more about them and also, causually, if they know any other people that could be a good fit for your program: it can lead to some great opportunities.

12) Specialized Advertiser-to-Publisher Platforms:

There are a couple of platforms that allow you to search bloggers and other publishers (on their platform) – to reach out to and connect by industry/product/interest.

A few that come to mind are:

Depending on your industry or vertical, you will have different results.


In closing: it just takes a little bit of creativity and thinking outside of the box when it comes to finding good affiliates. Many Marketers looking to focus on their affiliate program

 

 

 

2017 Ultimate Guide to Affiliate Definitions & Abbreviations

Looking into creating an affiliate program for your Technology or SaaS based company – but get bogged down with all the terminology when doing your research?

This post is meant to be used as a resource for understanding “lingo” commonly used in the affiliate marketing industry so you are not confused with reference terms.

Entities in Affiliate Marketing:

  • Merchant – Is a company that offers a service or product (Can also be used interchangeably with “Advertiser” in the context of having an affiliate program. More below).
  • Advertiser – In an affiliate marketing relationship, the Advertiser is the entity that offers the product or service that the Affiliate/Publisher promotes to an audience.
  • Affiliate (partner) –  Is any person, company, or organization that promotes a Merchant’s/Advertiser’s products or services.
  • Publisher – Another name for an affiliate or affiliate partner.
  • Network – A third party platform used by Advertisers to run their affiliate program on. For the Advertiser’s benefit: A network handles payment of commissions and collection of tax forms, compliance and monitoring, and other services an Advertiser might not be equipped to handle. For the Publisher’s benefit: The Publisher can centralize all affiliate programs they are a part of under one area. The network acts as a middleman marketplace for the two entities.
  • Sub-Affiliate Network – A Network for which the network operator’s themselves, join affiliate programs as Publishers. They then recruit affiliates under their network to promote these products and services at a lower-than-offered commission rate (commission arbitrage). For example, If I ran an affiliate network, I can join example.com’s affiliate program for which I would receive $100 for each customer I refer to them. I would then allow my sub affiliate’s to promote, and then I would pay them a $50 commission (netting $50).
  • Offer: The actual product or service that is being promoted from the merchant on behalf of the affiliate.

Affiliate Program Building Block Terms:

  • Commission: The reward an affiliate/publisher receives for performing some action designated by the Merchant/Advertiser.
  • CPA (Cost-Per-Action): The basic commission structure of all affiliate programs; Publisher performs this action, they receive this commission amount. 
    • CPS (Cost-Per Sale): Specified Commission for the action of referring a sale as an affiliate to a merchant/advertiser. For example: If I as an affiliate, refer 1 customer (make 1 referred sale) – I would receive $50. $50 is the CPS.
    • CPL (Cost-Per-Lead): Specified Commission for the action of referring a lead as an affiliate to a merchant/advertiser. A lead can be anything from submitting a web form, starting a chat, etc.
    • CPC (Cost-Per-Click): Specified Commission for the action of clicking on a link from an affiliate to a merchant/advertiser’s website. This is costly and often not used any affiliate programs anymore. 
    • CPM (Cost-Per-View or Pay-Per-View PPV): Specified Commission for the action of viewing a webpage through a link to a merchant/advertiser’s website. This is costly and often not used any affiliate programs anymore. 
    • Pay-Per-Call: Payment from Merchant to Affiliate for triggering a call to the merchant (other specifications to qualify such as call time, region, etc. can be qualifications for the commission). 
    • Pop offers or traffic: This refers to running ads on mobile apps and games where the affiliate can run a merchant’s ad and get paid a commission rate (there can be different types like Pop ups, Pop under and toolbars).
    • Redirect offers or traffic: This refers to promoting a merchant or sending traffic through parked domains or redirect domains. For example, if someone owned a domain: fastfreeinternet.com and the affiliate is promoting a internet service provider, working with the owner of the domain (or part of a redirect network) could redirect that URL to the merchant’s affiliate link for a specific period of time.
  • Cookie Duration: Is the window of time provided by the merchant to the affiliate from when: a link is clicked by a prospective customer to when they buy the product or service.  For example: A cookie duration of 60 days means: a prospective client  has 60 days or less between the time they clicked an affiliate link to when they buy the product or services (to ensure it is attributed to that affiliate.
  • Tracking Pixel: an image or javascript code placed on a merchant’s site to track clicks, impressions, sales/conversions, etc. (there are different kind of pixels to track different behaviors).

Affiliate promotional terms:

  • Banner:  Usually a JPEG or a Gif (animated) file that affiliate’s place on their website or blog to display an advertisement of the merchant’s products or services.
  • Text link: Html code that presents text with a hyperlink in it (usually an affiliate link).
  • Deep linking: When an affiliate links to another page on a merchant’s site, than what is provided in the default affiliate link. For example, if your default affiliate link is: example.com?affiliate=TOM and an affiliate wanted to link to a merchant’s pricing page – they could use a deep link like: example.com/pricing?affiliate=TOM
  • Swipe files: written content (such as blog posts or email copy) that are created by the merchant for the affiliate to use to market their products and services better.
  • cloaking links (redirects): When an affiliate runs their assigned affiliate link or parameter through a redirected URL so that other affiliates or merchants don’t see their structured URL’s. Note: this is a best practice  – and not seen as something an affiliates is doing to not allow you to see how they are promoting. 
  • Cobranded landing page – A page provided by the merchant (on the merchant’s site) that has information about a specific affiliate/publisher so that the specific publisher can use it to promote sed merchant for better conversion rates.
  • Typosquatting –  a method used by some affiliates to take advantage of misspelled domain names (often redirected to an affiliate link) in efforts to direct visitors who have misspelled the domain when typing into the browser. For example, someone might buy McDonlads.com to direct people who type this, through an affiliate link. This is forbidden in most affiliate program’s terms and conditions. 
  • Trademarking bidding – The act of bidding on a companies registered trademarks within Pay Per Click Ad networks. For example, an affiliate could bid on “Gap.com” in their PPC ads, and show their affiliate link vs. the companies ads. In a majority of affiliate programs, this is not allowed. 
  • Cookie Stuffing –  Considered theft/stealing, is the act a publisher intently makes by stealing attribution of another channel or affiliate’s referred sales. For example, an affiliate might figure out (technically) how to find other affiliate’s promoting a product and prior to customer’s going to the merchant’s site – they remove or overwrite the other channel or affiliate’s cookie with their own.
  • Toolbar – Is a addon or extension to a browser for some function to a user. For example, one toolbar might promise visitors who download it – “earn money searching the internet.” The toolbar publisher would then direct users to sites he is an affiliate for, and if those users take a specific action – then the toolbar publisher gets a commission. Toolbars are often not allowed in a majority of affiliate programs. 
  • iframed sites – is the act a publisher takes to create a version of a merchant’s site within an iframe (so it looks like the real site to the user). This is often not allowed and strictly enforced in most affiliate programs. 

Common Metric and reporting Terms:

  • EPC (Earnings Per Click): In an affiliate program, it’s the affiliate’s earnings divided by the affiliates clicks x 100. This is used by affiliates to understand their earning potential if they choose to promote a program.
  • AOV (Average order value): It’s the total revenue divided by the total # of orders for a given period of time.
  • CR% (Conversion rate percentage): It’s the total sales/orders divided by the traffic for a given period of time.
  • ROAS (Return on Ad Spend): Is Revenue/cost of promotions or ads.  

Common Commission Junction abbreviation and definitions:

  • Transaction – Is a a commission record found in your CJ reports.  
  • CID # (Customer ID) – Is a unique number given to each commission junction publisher record.
  • PID # (Publisher ID)  – Is a unique number given to each website under a publisher record in Commission Junction (often use to correlate a commission record with a specific website under a Publisher’s account).
  • AID # (Ad ID) – Is a unique number given to each Ad (banner, text link, etc.) within a Advertiser’s
  • SID # (Shopper ID) – is a unique, alphameric code that is appears on a transaction to identify specific shoppers or sources of where a commission/transaction took place.
  • Program Terms: Are the established terms and conditions between the merchant and publisher.
  • Application Rules: Are the accept and decline criteria you can put in place to approve or decline new publishers into your affiliate program.
  • Flex ID: The Flex ID sub-tab enables you to assign an ID of your choosing to a publisher CID. This advertiser-assigned ID can be passed to your site on the click, from the respective publisher.
  • Corrections:   The act of merchant correcting (and sometimes declining) a commission because it was: returned, duplicate, referred by another affiliate.
  • Subscriptions:  For merchants to send data to CJ (through Email, FTP, etc.) with a list of Order ID’s to correct.
  • Publisher Sign Up Form: Link merchants can link to from your website to direct your visitors to become publishers on the CJ network.
  • Publisher Group:  A feature for merchants/advertisers to group publisher’s in their affiliate program (to report on or use to email with Commission Junction).

If you’d like to see more affiliate marketing terms and abbreviations, check out the Earning Guys Article here. 

Are there terms that you have come across that you don’t know? Please comment below and I can answer and add them to the list!

How to Find Affiliates Breaking Your Terms & Conditions

If you had an affiliate program actively running for over 6 months, something you need to consider is how your affiliates are promoting you and if their promotions are violating your terms and conditions.

Why is this so important? Doesn’t verification of sales before commission payments are made, negate the need for upfront investigation? No – and here is why.

If an affiliate is promoting your brand and products/ services and is advertising wrong discounts, wrong information, etc. you’d agree that is not good right?

Or what if an affiliate is impersonating your brand with iframes of their site or by bidding on your trademark in Google — and driving customers that you’d already get if you were bidding on your own keywords. Not so hot, huh?

Therefore, to keep this in check we need to keep tabs on how affiliates are promoting that might not necessarily get caught and stopped through your sale verification process.

Finding Affiliates that are using faulty or large discounts to promote your products:

Most affiliates, at least in my experience, are making claims on large discounts for two main reasons:

  • They want to rank for: Your brand name + highest discount to piggyback organic traffic.
  • They just want to get the sale – even if it is misleading to the customer and maybe sneak one past the Affiliate Manager, it’s something they won’t have to deal with.

The best way to find this is the most obvious: Google. Look at the search results of various keyword combos like:

  • Brand name + discount code
  • Brand name + promo code
  • Brand name + current year code

There is another option that can be leveraged here as well that we discuss in the next section….

How To Find if Affiliates that might be advertising old, incorrect, or misleading product information.

While, some programs don’t require (via the affiliate Terms & Conditions) affiliates to be responsible for correct information about your product or service (which is a two sided street: you have to keep them updated on any changes)– it’s always important to keep abreast of bad or old information out there about you as a merchant.

The best way to do this is: constantly reviewing referring URL source information of traffic coming from your affiliates. 

Spending some time each week going through traffic from affiliate URL’s and reviewing the information presented on the page for which the affiliate is linking to you – is crucial. You then can reach out the the affiliate if they have wrong information, old screenshots, incorrect pricing, oversold info on products or service, etc.

How to find affiliates who are bidding on your Trademarks:

Unless you have a PPC team and/or actively running Google PPC campaigns for your trademarked keywords – you might not know this is happening.

To find out, my suggestion is:

  • Clear browser cache or open up an incognito window.
  • Search google for “brand name” and see if campaigns are running in the paid ad section that are not your own (do same for Yahoo!, Bing, Yandex and other search engines)

advanced tips:

  • some affiliates might run PPC ads at different times and advertising different geographies, that given your location and time – might not be able to see. You can use a browser extension like Tunnello as VPN to check from different localized search engines  (.co.uk, .ca, .nz, etc.)
  • If you are running a large program, you can invest in continual monitoring and reports when new PPC bidders put up campaigns with your registered trademarks. A company I have used in the past to help with this is BrandVerity.

How to find iframes, toolbars, or anything else misleading:

These options are a little bit harder to spot  – but nonetheless, can be targeted given a few approaches.

With iframes and toolbars: using a combination of referring URL’s and an SEO tool like Ahrefs.com – can help you analyze the backlinks. For instance, with Ahrefs, you can search referring domains and select/Filter by redirect: this will basically show anyone (and their source referring url) that is cloaking and redirecting their affiliate link (which, if you’re new to cloaking doesn’t necessarily mean they are doing something bad at all. However, if someone is doing something bad this is often a method they will use to hide this. In other words, correlation doesn’t always mean causation).

To wrap up, this is by no means an exhaustive list of how to stop every trick in the book that affiliates may use to break your terms (nor does it assume that these are the only term breaking rules people often break). However, it is a good introduction to help you realize the importance and due diligence of monitoring this on regular basis.

Definition: Affiliate Marketer vs. Affiliate Marketing Manager

Semantics can be a tricky thing, especially when it comes to job titles. In one industry or company, a role might mean one thing, but in the context of another the responsibilities might be entirely different.

When talking to business owners (especially small to mid-sized companies) I sometimes see a disconnect between two different roles: The role of an Affiliate Marketer and the Role of an Affiliate Marketing Manager.

Many companies often think: I need someone to manage my affiliate program. Therefore, I need an affiliate marketer. If they are a good Affiliate Marketer, they must know how to manage an affiliate program. 

Now, this is not uncommon to find an Affiliate Marketer turned Affiliate Marketing Manager. However there are distinguishable responsibilities between the two. For example, not all car mechanics know how to run the shop, right?

So let’s look at what an Affiliate Marketer is or does:

Affiliate Marketer Roles & Definition: 

  • Expert Marketer; often can promote/market a product or service better than the merchant (or in different ways to show more than one value proposition).
  • Responsible for driving traffic to an offer/product/service; “packs the store” so to speak.
  • Can be a Teacher/Educator; shows how or why a product or service is used for a particular vertical or audience.
  • Often operates his/her own web properties that relay the traffic on to the merchant.
  • Usually (but not always) a customer of the product or service he/she is promoting.

Now let’s look at Affiliate Marketing Manager:

Affiliate Marketing Manager Roles & Definition: 

  • Opportunity seeker & affiliate program marketer; Finds the right affiliate partners that could be a good fit for the merchant.
  • Is a relationship builder; Works between merchant and Affiliate Marketers to find the best outcomes for both (more customers and products/service sold for the merchant and more $$ commissions for the Affiliate Marketer).
  • Logistical Operator; Is behind the scenes ensuring tracking/attribution is working, affiliates are getting paid on time, driving new affiliate promotional campaigns/contests etc.
  • Gatekeeper/Policing; ensuring affiliates that are not a good fit for the program don’t get in as well as affiliates that might be breaking terms and conditions with how they are promoting.

An Affiliate Marketing Manager could be a good Affiliate Marketer and vice versa; no doubt, that could be a possibility. Nonetheless, there are defined roles and developing backgrounds of experience for each.

So the next time you are looking to hire or get involved with an Affiliate Marketer or Affiliate Marketing Manager – remember they are different!

 

Should I Auto-Approve Affiliates in my Affiliate Program?

Once you have an affiliate program up and running, many always wonder:

Do I need to approve these affiliates or can I just set to approve ALL affiliates?

It’s often a case where a merchant doesn’t have the time to approve publishers but in other cases it is times when they don’t see the value of reviewing and approving affiliate applications.

So the answer is: It depends. 

Let’s take the case for each and warning signs you should consider for both:

Approving Affiliates One-by-One:

If you have the opportunity (and resources and time) to review affiliate applications prior to joining, then by all means, do so. Why? the benefits are bountiful:

  • You can request certain information and review areas of promotion prior to them being active in your program. This gives you the ability to catch any potential “bad apples.”
  • You get to know who is in your program and can reach out to them to forge better relationships.

But, I really want to preface that if you don’t have the framework or commitment for regularly approving affiliate applications it can be detrimental. 

When an affiliate signs up for your program, they have a direct intention or at least an idea to promote your product or service. If they are stuck in any sort of “pending” period for you to review your application for a significant amount of time (and I would argue that that pending time is more than 24 hours), then they could lose interest or be frustrated that someone is holding up the process.  Even worse, if you don’t offer a way for pending affiliates to reach out to their Affiliate Manager then it can harbor even more frustration.

Auto Approving Affiliates:

Many in the industry look down on auto-approval since they think it is a “lazy” way to run a program. However, if you are getting hundreds of applications each day or week and don’t have the adequate support to review them – auto approving is an option…with caution.

If you have proper tools in place to monitor term violations as well as any potentially fraudulent activity, auto-approving can be possible.

Also, you will want to make sure that your Terms and Conditions are firm so that if affiliates/publishers do something harmful it can easily be referenced in the document, and action can be taken.

 

Overall, it really comes down to preference and if you have the tools and preparation for auto-approving.

Still not sure on your specific situation for approving affiliates? Let’s do a call or email. See how. 

 

Why Can’t I Just Run my Affiliate Program on Auto-pilot?

UpFoundry_Autopilot

Many who start an affiliate program for the goal of growing their customer base or expanding their revenue channels have an assumption that: “once they set up the program, shouldn’t It be able to operate on it’s own?”

While you CAN do this, many in the affiliate marketing industry would strongly advise against it. Why? Below, I discuss the many oversights to running your affiliate program on auto-pilot.

No Crowd control.

UpFoundry_Autopilot proggram

Imagine you own a popular night club. You have hundreds waiting to get into your establishment each night- the line is practically out the door. Now say you decide to have your nightclub run on auto-pilot. You remove the staff, and ditch the security guards out front. What do you think will happen?

When you run your program on auto-pilot you fail to filter out:

  • affiliates who join your program that might not be a good fit for your brand and target market.
  • affiliates who engage in fraudulent behavior to win commissions.
  • affiliates who don’t read your affiliate terms and decide to use marketing channels that you clearly state not to use (PPC, Social, etc.).

No Activity Monitoring

Continuing with the bar example I mentioned above, now let’s zero in on people buying drinks at their own discretion. Since you have no staff, you require all customers to take a drink and deposit cash in the register – without any staff watching. What will you think will happen?

With affiliates, it can be quite the same. While you could argue – “well, we check before we pay them, that the sale they made was legitimate. Isn’t that enough?” 

Unfortunately, No. If you awarded a golf player $100 for each time he made a hole in one, but you were not allowed or covered your eyes when he/she hit the ball – would that be enough information to pay them the $100 when you see the ball in the hole? I don’t think so. 

When you run your program on auto-pilot you miss:

  • What content/banners/links affiliates are promoting and how they are promoting.
  • Where your affiliates are promoting to bring you sales.

No growth and relationship building.

It’s the classic notion in business: Doing the same things or nothing at all, and expecting better results. When you run your program on auto-pilot you are aiming for the lowest common denominator: How can I get the most activity and sales, without the work?

When you run your program on auto-pilot you miss out on:

  • Building long-lasting relationships with affiliates that could truly propel your brand.
  • Understanding what successful affiliates are doing that brings you sales.
  • Proactively finding new affiliates that could be strong advocates for your products or services.

Do you currently have an affiliate program that is on auto-pilot? What issues are you facing? I’d love to know either by email or the comments below.

How to Set Your Commission Rate/Structure for Affiliates

In this article, I will walk you through all the different factors and considerations for setting a commission rate for your affiliates. Read from to top to bottom as it is important you follow the process in order.

So you have come to the point where you need to draft out how you are going to compensate your affiliates for referring customers your way. You have looked at your competitor’s affiliate programs and asked advice from others but your stuck with no clear path on what you should do.

My plan with this article is after you read you will be left with enough guidelines that creating your commission structure for your program will be a lot more approachable.

Enjoy….

Before you start: Fundamentals.

I highly advise that as you put together your commission structure you keep an important factor in mind: Cost.  Mainly, these two questions:

  • Margins: What are the margins on my products or services?
  •  Budget: What is the budget I have set aside to pay affiliates?

Why are these important? Without knowing reasonable margins – how can you truly see how much you can afford to commission an affiliate per product or service?  As for your budget: Your affiliate program shouldn’t be an after thought; it should have a line item on the accounting spreadsheet.

The LAST thing you want to have happen is see major success with your affiliates and then not be able to pay them.

Working with affiliates is all about trust so losing it by not coming through on your promise can be very detrimental. If you have to bug your CEO/CFO or fight your accounting department to work out a budget for the affiliate channel – by all means do so. It will save you trouble later on.

What you want out of your commission structure: 

Now that you have a strong understanding of your cost – let’s look at what you really want out of your commission structure. Your commission structure should be:

  • Simple: Affiliates signing up for your program need to be able to decipher how much money they can make — I would say, within 5 seconds of landing on your affiliate signup page.
  • Competitive: it’s important to stay competitive with other affiliate program’s in your industry but not at the risk of your costs. which leads me to my next point…
  • Above Costs: It goes without saying: your commission should always be within your margins and above costs of your product or services you are selling.

Before I get into range or exactly how much your commission should be within you margins – let’s get a more general understanding of the different commission types there are…

Different Commission Types:

You can choose to compensate affiliates on whatever action you’d like them to take. What I mean by this is: Buying your product or service, filling out a form, receiving a phone call are just some actions. To get a jist, here is the most common lingo for basis of commission types (below). I am sure as you have seen looking around on the web, you might come across this abbreviations:

  • CPA (Cost per Action) – This is most commonly compensation to an affiliate for referring a paying customer.
  • CPL (Cost Per Lead) – This can be compensation to an affiliate for someone he sends filling out a contact or online form.
  • CPM (Cost per Impression) – Compensation for a banner “view” or loaded page or ad an affiliate gets someone to do.
  • CPC or PPC (Cost Per Click or Pay Per Click) – compensation for an affiliate who gets someone to click on a link/image/etc.
  • Pay Per Call  – Just as it sounds:)

So what is the best most effective? It really comes down to your business, however a Cost Per Action is most common as it compensates the affiliate for actual money to product exchanging hands.

Various Commission Structure models:

Now that we have a primer on the various commission types – let’s see how companies/merchants/advertisers set their commission rates based on their products and services…

commission identifier:

  • Percentage of sale: A percentage of the price of whatever the customer who he/she referred bought. Example: 25% commission on a product that a referred customer paid $10 for. $2 would go to the affiliate.
  • Flat Fee: Just as it sounds. Example: $25 commission on each product or service a customer buys that you refer. 

Frequency: 

  • One-time: Commission is paid out one-time per referred customer.
  • Reoccurring: Commission is paid out on a weekly/monthly/annual basis to the affiliate (usually based on the lifetime of that account that he/she refers).

Structures: 

  • Product or Service based:  If you have a wide range of products or services that range in price, you might denote different commission structures for each. Tip: Keeping with the “Simple” suggestion earlier, do it by product category vs. individual commissions for every product; you will be less confused and so will your affiliates. 
  • Unit Based: Some companies/merchants/advertisers will have increasing commission rates for affiliates based on how many referrals they make each month. For Example: 1-5 referral sales: $50 flat rate on each referral. 6-10 $75 flat rate on each referral (and so on…).

So what combination of these factors is the best? It really depends on your business but what I have seen the most of is: One-time, percentage or flat rate based.

So really: Is that it?

Most people get to this point and just want a simple answer: What % of my margin should my commission rate be? or Just tell me what is the best commission structure…and while I can give you some general guidelines – it’s a classic case of analyzing risk. Some companies might offer more commission because they keep customer’s longer (think of insurance- the switching and hassle is high for policy holders to switch so they stay longer – thus, the average payment value for that customer is high) while other’s offer quite low commissions because their margins are leaner. It really is up to you to know your business!

Did I cover everything? 

While I covered the nuts and bolts there is still several aspects you might be wondering about such as: How to change your current commission structure without pissing off affiliates or other methods that are involved in commissions/payments (pending periods, minimum commission balances, etc.).