Chelsey Holt, Senior Director, Client Services, Acceleration Partners

Steps to Establishing Your First Affiliate Marketing Program

If you want to find a cost-effective means of creating meaningful digital touchpoints and generating sales, an affiliate program could be the key. Affiliate marketing involves influencers, content sites, vloggers, incentive-based webmasters, and others promoting a particular product or brand in exchange for a commission for every sale made with that promotion.

For example, an affiliate program could have an influencer include links in blog posts to specific products on a company’s website, with unique tracking characteristics in the link to ensure the influencer receives a percentage of the sale.

Affiliate programs are great for all parties involved, as businesses can effectively get their name and offerings with minimal upfront investment. 

Let’s review the steps to get started the right way with your program.

Step 1: Define Your Goals and KPIs

Start by setting specific goals and selecting the best performance indicators (KPIs) for your program. Be sure to base your goals on your unique definition of success, whether that means boosted revenue, increased customer impressions, lead or customer acquisition, or another attainable objective.

Once you’ve established your goals, you can determine which KPIs and metrics to use to track progress. 

Some potential KPIs could include:

• Conversion rate
• Sales per affiliate
• Average order value
• Cost per affiliate sale
• Return rate
• Revenue
• Engagement
• Year-over-year (YoY) growth

You should then align your affiliate marketing objectives with your general business goals, which will drive meaningful success for your campaigns.

Step 2: Choose the Right Affiliate Model

Once you’ve set some clear goals for your program, the next step is to select the most compatible affiliate model that aligns with your goals, profit margins and budget.

To start, consider the kind of commission structure that will be the best fit, whether it’s cost-per-acquisition (CPA), cost-per-lead (CPL), or another model that corresponds to your campaign.

You’ll also want to decide on whether to enable multiple commission tiers or businesses for performance to reward your affiliates. For instance, you could opt for tiered commissions if you want to experience sustained growth over time. Meanwhile, awarding bonuses based on the number of leads or sales achieved could be better if your goals center around revenue or lead generation.

Step 3: Select the Best Affiliate Platform or Network

With so many affiliate platforms and networks out there, you need to use the one that’s right for you.

To do so, some things to look at include the specific features you want and the network or solution’s ability to integrate into your existing systems seamlessly. Features can include reporting and data insights, along with tracking capabilities to measure performance and incrementality.

Additionally, don’t forget to consider payout structures, fees and automation level. These aspects can help you figure out how to keep your programs cost-effective and efficient.

Finally, make sure you determine if managed support is meaningful for you and your goals if you don’t have these resources available internally. Some platforms and networks offer managed services, others are simply SaaS, and you’ll need to enlist external agency support to help your affiliate program strategy and operations.

Step 4: Decide Between a Private or Public Program

You can also choose between a private and a public program. Reviewing the pros and cons of both can help you make the right choice.

While a private program can sound elusive and give you more control over your approach to affiliate marketing, you’ll need to manually select and recruit affiliates to join your program, which can be more time-consuming. This can also prohibit your visibility in the industry and create gaps in the available partnership pool, depending on how much time you can dedicate to only outbound recruitment. 

Conversely, a public program can open you up to a larger pool of partners to potentially promote your brand. However, this means that all partners can apply to your affiliate marketing program, and you will need to carefully vet each application to ensure it’s the right mutual partnership fit.

Step 5: Create Competitive Commission Structures and Incentives

Encourage your affiliate partners to stick with you by offering compelling commission structures and other motivating rewards for their efforts. At the same time, you want to keep your partnerships profitable, so it’s often best to incorporate performance-based incentives that maximize both revenue and your partnerships’ longevity.

Consider offering some of the following to appeal to your partners:

• Tiered Commissions: Once an affiliate reaches a threshold of sales in your program, you might move that affiliate to a higher tier with a slightly increased commission, such as raising a commission percentage from 10% to 15% and then 20%. 
• Temporary Commission Bonuses: When an affiliate achieves a specific goal, like reaching a minimum number of sales or leads, you could offer bonus commissions during certain periods, such as holidays, seasonal sales, or new product launches.
• Recurring Commissions: Businesses operating with a subscription model could reward affiliates based on the number of subscription renewals among their respective customers.
• Product Discounts: Affiliates who like your products may also enjoy discounts, which can be great in getting affiliate partners’ hands on your products to better understand and promote their value.

Commissions should also align with industry competitors and standards to keep your efforts competitive and compliant.

Step 6: Put Together High-Quality Affiliate Resources

Make it easy for affiliate partners to learn the ins and outs of your brand and offerings, and make it equally easy for those partners to promote them effectively.

Many marketing assets could equip your affiliates to promote in creative and exciting ways, from product images and banner ads to pre-written content and links.

Also, educate affiliates by giving them an accessible knowledge base or affiliate hub, which can contain various frequently asked questions and details to inform affiliates.

As affiliates learn more about your brand and what it’s all about, they can maintain consistent brand messaging across all materials. In turn, you build better brand recognition among your audiences.

Step 7: Establish Clear Policies and Compliance Guidelines

To further maintain compliance and keep all branding consistent, you need to outline your business’s rules for brand representation, ethical practices and promotional restrictions.

In your documentation, be sure to set clear expectations for everything from cookie duration and permissible traffic sources to attribution for tracking leads and sales.

It’s also important to stay compliant with all legal requirements, including those that apply to respecting users’ privacy. For example, you should keep your affiliate programs and partners compliant with Federal Trade Commission (FTC) guidelines, General Data Protection Regulation (GDPR) regulations to maintain privacy, and the Controlling the Assault of Non-Solicited Pornography and Marketing Act (CAN-SPAM Act) for regulated commercial emails. 

Lastly, it’s important to outline your brand-specific policies for partners to abide by. This can include ensuring proper marketing practices, such as ensuring toolbar cookies stand down when another affiliate or marketing channel is already involved, taking a stance on whether you’d allow a partner to bid on paid search teams, and ensuring your brand integrity regarding logo and other brand-specific assets is left unaltered.

Step 8: Implement Affiliate Tracking and Performance Analytics

It’s important to be able to measure your efforts to determine whether they’re working. To track your affiliate programs and compare them to your goals, you can use different types of tracking software that can integrate into your chosen platform or network.

Analytics tools such as Adobe, Measured, GA4 and Looker can track your affiliate channel performance with your other marketing channels to ensure you have a full view of your digital marketing performance and ecosystem, tracking metrics like clicks, conversions and commissions.

To keep all of this data valid and authentic, set up fraud detection methods to prevent any unethical behavior from compromising your program or business.

By analyzing data in real time, you can also figure out what needs improvement to achieve your goals and optimize accordingly.

Step 9: Recruit and Onboard the Right Affiliates

Once you’ve set up your commission structures, program terms, tracking measures and affiliate resources, the next step is to begin launching partners into your program. The affiliates you select should reach your target audiences through the media and platforms those audiences use. 

There are several types of affiliate marketing partners you can work with, such as:

• Influencers
• Bloggers
• Media sites
• Content creators
• Loyalty or coupon partners

It’s important to develop an effective outreach strategy that brings in high-quality, qualifying affiliates. As you bring in new partners, establish clear brand guidelines and provide affiliates with promotional tools and other materials. This helps keep onboarding streamlined so publishers can focus on driving performance vs. operational setup. You want onboarding to be as simple and scalable as possible.

Step 10: Optimize, Scale and Maintain Affiliate Relationships

Based on the data you gather and how on track you are with your goals, you should continuously test new optimizations to focus on sustainable growth and working towards your KPIs.

This includes continuously nurturing your partner relationships, refining your commission structures, testing new incentives such as partner or channel-specific promotions, testing into new exposure opportunities and constantly recruiting new partners into your program. 

Sometimes, this can also mean that an existing partner or group of partners in your program is no longer the right fit based on any changes to goals or lack of performance. It’s important to routinely evaluate your partner pool and ensure you’re addressing any lack of performance or changes in promotional strategy to best align with your goals.

By continuously optimizing your program based on data-backed insights and building relationships, your program will be set up for sustainable and incremental growth.

Identify What Works Based on Your Brand and Your Customers

When starting out with affiliate marketing, there is no guarantee you’ll strike gold the first time. Once you’ve taken these steps to build your affiliate program, engage in ongoing optimization and engagement to get the best results.

In order to ensure your ongoing success, it’s important to take a customer-oriented approach. Think about your customers’ needs and wants, and work with your partners to show up where your target customers typically are so that you can offer a solution to them. Whether you’re selling shoes, software, or services, affiliate marketing is most successful when your ongoing strategies are focused on capturing and engaging your customers.