Affiliate Marketing explained in brief
Affiliate marketing is a special form of marketing in which an affiliate (sales partner of a retailer also called partner or publisher) offers advertising space on his own website and uses it to advertise the products and services of a partner company (merchant, advertiser, provider) and directs his contacts to the services of the merchant. The affiliate is only paid by the merchant in the event of success and receives an agreed commission exclusively for successful campaigns, such as an order.
The goals of Affiliate Marketing
Through affiliate marketing, a company can increase the reach and sales of its products or services. But affiliate marketing is not suitable for every company, this should be sufficiently analyzed in advance.
When a company uses affiliate marketing as an advertiser and advertises on the affiliate partner’s side, it sometimes pursues the following goals:
- Increase of sales in the online shop
- qualified visitors to the website and valuable contact requests
- more traffic via clicks
- Acquisition of subscribers for your own newsletter
- Downloads of software or whitepapers
- Installing Apps
- Registration for test account or special offers
Let an expert advise you on the development of your personal affiliate marketing strategy – WebOptimierung, your Online Marketing agency, looks forward to hearing from you!
The Importance of the Website in Affiliate Marketing
The corporate website is also of central importance in affiliate marketing. Either the entrepreneur acts as an affiliate, provides advertising space for merchants on his website and generates commission revenues or he himself becomes a merchant. In this case, he looks for suitable affiliates to advertise his products and pay commissions for successful campaigns.
No matter which page you choose, the website is of great importance. Ultimately, the advertising space will only be successful in an environment with a suitable theme. This places high demands on the thematic, technical and design structure. If customers then reach the merchant’s website from an affiliate page, then this website must also be professionally designed and “pick up” the customer. Only in a suitable environment can the offers be presented effectively and in line with the target group, and corresponding reactions such as clicks, leads or sales can be generated.
As part of the affiliate marketing strategy, the website in particular should be subjected to close scrutiny and many success factors must be taken into account when designing the concept. Please remember: Doing it yourself does not save money and time, but only success!
Affiliate Marketing as an Instrument for Success in Online Marketing
For affiliate marketing to be successful, publishers must be offered an attractive affiliate program as a basis. If the compensation concept is coherent and economically interesting, then publishers will quickly be convinced to integrate the advertising on their website. Affiliates are the most important capital of each affiliate program.
The challenge for the merchant is to find the right partner who offers the merchant’s offer on his website in the complementary thematic environment. Ideally, merchants look after “their” affiliates very closely and communicatively and offer them individual advertising media, strong texts, graphics or even technical data sheets that the affiliate can use on his website.
In addition to the well-known, classic banners, text links are among the most widespread integrations. At first glance, the user does not recognize that it is “advertising”, but rather a simple recommendation, expressed in the form of a link.
There are different commission models for affiliate marketing, but all of them pay the commission to the advertiser only in the event of success.
With the models one differentiates according to it, starting from which concrete point of the establishment of contact a commission is to be paid. There are among other things the following variants of contact causes:
- Pay per Click (commission per click)
- Pay-per-Click-Out (commission per click and actual reach of the linked page)
- Pay per lead (commission per contact of potential customer)
- Pay per Sale (commission per sale)
- Pay-per-view model (commission for the insertion of an advertisement, usually thousand contact price/TKP, fixed price for every 1000 insertions)
- Pay-per-Print-Out (commission per printout, e.g. of a coupon)
- Pay-per-Install (commission per installed software)
- Pay-per-Sign-Up (commission per explicit registration of the customer on the merchant’s site)
- Lifetime compensation (the affiliate receives a commission over the entire period in which the referred customer buys from the merchant and generates sales)
What is an affiliate network and what does it offer?
An affiliate network is a platform on the Internet where affiliate partner programs are presented and also mediated between registered merchants and registered affiliates. The network is thus an interface between affiliates and merchants – here the merchant presents his affiliate partner program and the affiliate can decide on a suitable program and advertise. An absolute win-win situation, because the affiliate does not have to search for individual programs and the merchant finds a high number of potential affiliates in the affiliate network.
The affiliate network, as a service provider in the online advertising industry, finds and arranges suitable affiliate partners, provides both participants with the necessary infrastructure and offers the technical prerequisites for administration, tracking and determination of the commission. Affiliate marketing is very complex, so that a good affiliate network can be recognized by the fact that it actively supports its partners and personally looks after them. It provides an overview and management of campaigns and advertising campaigns, so that the merchants are aware of which campaigns are currently running and which advertising media the affiliates are currently displaying on their website. The merchants see the success of the individual affiliates as well as the amount of the respective commission. On the other hand, the affiliates see which new campaigns there are and which would suit their website. They also have an overview of how successful the current campaign is for them. The affiliate network continuously reports current statistics and reports that show the progress and success of the campaign. The system correctly calculates the commissions to be paid and notifies the merchant of them, which are then usually settled automatically. The affiliate network pays attention to security and thus avoids cases of fraud, so that the merchants only pay the commission to affiliates who have really published the campaign on their website.
Affiliate marketing, as so often, is based on the principle of “class instead of mass”. Because only a few affiliates are really good and it is often difficult to find, inspire and keep them. Usually this process is connected with a lot of work, so that an affiliate network offers helpful support. Because the decision for the cooperation with an affiliate network is above all the high number of potential affiliate partners, who do not want to register themselves in any case laboriously with innumerable, individual affiliate campaigns. With an affiliate network, everything can be handled via one platform – this saves time and money.
How do I find suitable affiliates for my affiliate program?
Affiliate marketing offers optimal opportunities to expand your own sales channels and sales activities on the Internet. As a business model, it is efficient and low-risk and ideally contributes more and more to sales. In order to build up a good affiliate program and to find good affiliates as a merchant, you first have to develop a suitable strategy and define goals in order not to act aimlessly. The affiliate programs live from their affiliates, they are the heart! This fact should be considered with all measures! Analysis is just as important for success: high-quality and accurate tracking helps to technically allocate the various transactions to the respective affiliates.
Then you should register with affiliate networks, because these are a good start to find the right affiliate program. The seven largest providers of affiliate marketing are:
What can you do now in the Affiliate Marketing area?
Affiliate marketing offers many advantages, but how can you as an entrepreneur assess whether affiliate marketing really suits your business? Is it possible to sell your product online at all? Is competition also active in affiliate marketing? Have you calculated enough margin to be able to pay commissions? Do you know what the click of a customer is worth to you? There are different types of affiliates such as theme portals, niche sites, test and comparison portals, video product tests on YouTube & Co., voucher portals, cashback portals, specialist blogs and online magazines. Do you know which one is right for you? The right affiliate marketing strategy does not fall from the sky, nor can you comfortably pull it out of the drawer. In order to be successful, you must develop a perfect solution based on your corporate strategy! Contact WebOptimierung, your Online Marketing Agency in Berlin, directly – we will be happy to advise you in detail about Affiliate Marketing!