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Affiliate marketing is a great idea. It’s one of the rare marketing strategies that works for practically every single business.
→ New business? Affiliate marketing can help you get more customers with low overhead.
→ Established business? Affiliate marketing can turn your customer base into salespeople you don’t have to train.
Affiliate marketing is like your favorite travel friend. They’re no fuss, always have a good time (despite jet lag), and are just there for a great time. With affiliate marketing, you’re only paying for the customers that come your way. You don’t have to pay Zuckerberg for clicks or views.
You just have to pay once you know you’ve made the sale. What other marketing strategy gives you that type of advantage?
The answer is none, and that’s why affiliate marketing is a great idea.
Let’s take a trip with your new affiliate marketing friend toward the destination: hitting publish on your brand new affiliate program.
Starting your affiliate program doesn’t come with a huge upfront cost. If anything, it comes with a tiny upfront cost and a HUGE potential value. Affiliate programs have to be one of the easiest marketing strategies to ideate and put into existence (in comparison to content, SEO, paid ads, etc.).
And that’s because it boils down to two questions:
When you’re building out your affiliate program, we want to view your program as a product. Just like you do market research before you start building out your company’s products, you want to figure out what pain point you can solve for your customers or audience with your affiliate program.
Sometimes that pain point is super clear, like giving them money or discounts on products. A marketing agency can give affiliate members $1,000 per new client referred. Other times, your referral program might take more creativity.
For example, Morning Brew built out an affiliate program for free newsletter subscribers. They decided to create various incentives like:
Your affiliate program doesn’t have only to encompass one incentive. Like Morning Brew, you can have several incentives that your audience gets access to depending on how many referrals they’ve sent your way.
Once you’ve ideated on what your customers want in return for referrals (the fun, creative part of this affiliate marketing)—we have to turn to our logical side.
Time for the logistics. We can’t act like your affiliate program isn’t going to cost you anything. If you’re giving incentives, you’re losing out on income, whether that comes from buying merchandise or paying for software to send referral cash to your affiliates automatically.
You have to crunch the numbers on your incentives and how much that customer is worth to you to know if your affiliate program makes sense for your business.
Giving $1,000 to each affiliate that sends a client to your marketing agency makes a lot of sense if your agency has minimum contracts of $20,000. But, if your agency has minimum contracts of $5,000—that’s a lot of money to give away and probably makes your business profit even to your expenses.
That’s not good for business.
Knowing how much each customer is worth is essential to launch an affiliate program confidently. Morning Brew offers access to their monthly events, stickers, and a bottle opener for the first few referrals their subscribers send their way. The margins on this are tiny, and brilliant for a company that runs on free subscribers (and paid advertising in their newsletter).
Once you know what your customers want in return for their referrals and what you can afford to give them, it’s time to get meta.
Your company’s affiliate program is part of your marketing strategy…that has to get marketed. Don’t you love the meta world of marketing? Affiliate programs are the perfect way to describe just how much inception goes into our daily work as marketers and business owners.
Affiliate programs are a product within themselves. When you start your company’s program, you have to:
1. Figure out what your audience deems worthy of their referral (market research)
2. Check your margins (make sure you can still be profitable)
3. Get people to sign up (market!)
This sounds a lot like how you launch a new business or product, huh? That’s because it really is the exact same process. Your affiliate program can’t sit idle, just like your products don’t sit on the bench.
They’re always in the game with promotions in your content, paid ads, social media, website, emails, and more.
If you want to launch a successful affiliate program, you have to look at it as a product launch. Make sure you’re beta testing your offer, A/B testing your copy, changing your graphics, and learning from your sign-ups to figure out what’s working well.
Market your affiliate program…that has your customers and audience market your products.
That’s the best way to make sure your company’s affiliate program catches enough momentum to become a big part of your business.
Creating an affiliate program is like a law of marketing. Your customers travel through the Customer Value Journey and automatically become brand ambassadors and promoters after they’ve bought your high-tier products. They’re already in the stage of promoting your products.
It’s a rare occasion that we can say a marketing strategy is for every business with total confidence, and affiliate marketing is it. Every business can use affiliate marketing. Your customers are talking about your products and services anyway—why not incentivize them to talk about them more?
This is the easiest way to start your company’s affiliate program so that you can turn your raving fans into promoters who bring more customers your way, creating a flywheel of happy customers.
What more could a business ask for?
Is Affiliate Marketing for You? 5 Questions to Ask Yourself Before You Start
Level 1 of the Customer Value Journey with Dave Albano [VIDEO]