Affiliate marketing provides a great way for advertising your products or making your services known to a wider audience. It lets you work with professionals who understand the rudiments of marketing to improve sales. But is affiliate marketing worth it? Should you invest your time in it? Or do you think the market is too saturated and might be an impossible task?
In this article, we'll provide answers to clear your doubts. You will understand if you should dive into affiliate marketing for your online store in 2022. Without further ado, let’s begin.
What is Affiliate Marketing?
Affiliate marketing is a form of advertising where publishers earn a commission each time they promote a retailer’s product or service. The affiliate partner or marketer is rewarded with a payout after reaching a specific target laid down by the retailer.
Typically, the result of affiliate marketing is sales. However, some models can reward marketers for free-trial users, leads, clicks on the website, etc. It’s usually easy and free to join affiliate programs, so you do not have to worry about high capital investment. It is a great business idea if done correctly.
Understanding how affiliate marketing works will help you decide if you should try it. Affiliate marketing involves having someone (affiliate) refer to products or services by sharing them on blogs, social media platforms, podcasts, or websites. Such a person will have a unique link connected to their recommendation, and they will earn a commission every time someone purchases through this link.
Photo by Dominika Roseclay
Is Affiliate Marketing Worth it?
Yes, it is worth getting into affiliate marketing in 2022. Reports from Hosting Tribunal stated that affiliate marketing accounts for over 16% of e-commerce orders in the United States and Canada. This shows that it is among the biggest income sources for online stores.
The popularity of online shopping, vlogs, blogs, and influencers is increasing rapidly. Therefore, affiliate marketing is a great strategy for marketing your products online and reaching a wider range of intending audiences.
Moreover, The affiliate marketing industry is worth more than a billion dollars, and it keeps getting bigger. Likewise, popular online marketing channels such as Google Ads are getting more expensive and competitive. Therefore, you can leverage affiliate marketing as an excellent alternative for product, service, or brand awareness. You should consider affiliate marketing in 2022 because of the following:
1. Increase Brand Recognition
The goal of every online business is easy brand identification by as many potential customers as it can reach. Affiliates help boost your brand's recognition and reach by driving additional traffic to your website. Affiliates have a vested interest in your business and are dedicated brand advocates. They help develop trust with potential customers because they receive a percentage of your sales.
2. Boost Social Proof
In today’s dynamic world, consumers are now more aware than ever before. They now care so much about social proof when it comes to a brand's reputation. Studies show that nearly 93% of shoppers examine online reviews before making a purchase decision. Affiliate product or service evaluations provide genuine social evidence to prospective consumers.
3. Reach a Larger, More Targeted Audience
Small e-commerce businesses can tap into their affiliates' audiences and broaden their brand's reach. Other marketing and advertising approaches may not have been straightforward in targeting and identifying these new audiences. You may find a way to make sure that the traffic you receive through an affiliate's link is targeted to folks who will find your items or services valuable by choosing affiliates who are aligned with your brand.
4. Increase Your Conversion Rates
Monitoring how your company operates allows you to make future operational improvements. You can acquire crucial insights into where your consumers originate and why they buy by gathering data from affiliate marketing tracking. You can also use studied and analyzed data to boost conversions by improving your website, giving more appealing visual creatives.
5. Save Money
Compared to the price of advertising or other forms of promotion, affiliate marketing is a much more cost-effective option. Affiliates are only compensated when they make a sale because the program is performance-based. You can avoid squandering money on unproductive advertising campaigns by establishing a commission structure ahead of time.
6. Increase Your Return On Investment (ROI)
Determining ROI for most marketing campaigns is a difficult and uncertain waiting game. Affiliate marketing's performance-based methodology is designed to be profitable. Businesses only pay for closed sales rather than impressions or clicks to attract potential buyers. You acquire influence and direct access to a receptive, highly focused audience who are more likely to buy from your brand through an affiliate network.
Photo by Darlene Alderson
How to Set up an Affiliate Program for Your Online Store?
Setting up an affiliate program for your online store requires you to put in some work so as to get excellent results. The following steps on how to create an affiliate program will help you get the best out of this marketing model.
1. Select a High Average Order Product
The first step to setting up your affiliate program is to select products to promote. Although you can select all your products, it's best to pick the one with a high order rate. Selecting a high average order product will increase your chances of clicks and purchases. Inform the affiliate about the products they should promote and give a few promotional tips like:
- “Buy More Save More” Discount
- Offer first-time buyers a Discount
- Promote Free Shipping on Orders Above $50
Offering tips enables the affiliates to sell more, which can increase sales and revenue for you. If a particular product isn't giving you sales, you can always adjust it.
2. Determine Your Affiliate Commission Structure
There is no affiliate marketing without the publishers (affiliates). Therefore, deciding how to pay them is a crucial step in creating your program. In this case, analyzing your competition will come into play. The results of the competitive analysis will help you know the structure of the competition and create something more appealing.
You need to answer questions like, “will you pay in cash or with in-store credit? What percentage of the product or service costs will you pay to affiliates? You may also consider giving top affiliates bonuses for meeting predefined goals. This will attract more affiliates to your program. If you want to stay competitive in the ever-dynamic market, you also need to consider your own needs. Do not offer what will hurt your business’s bottom line.
3. Choose an Affiliate Management Network
You can choose to create your program or use an already existing affiliate network. Building your own affiliate program is a great decision if you have the resources and time to manage it. Creating an affiliate program is quite easy, thanks to Shoplazza and its app developers. This is your best place to start your affiliate marketing journey, with a simple interface and features available.
Shoplazza has several built-in affiliate marketing apps to help you create, track, and manage your affiliate marketing program. If you’re looking to get more traffic on your e-commerce website, then you should use one of these high-end management apps. Get started by signing up on the website to enjoy a seven-day free trial to help you understand how the platform works. After signing, you can install any affiliate app of your choice. The app will take you through several processes to run your affiliate program related to your online business.
4. Hire Your Affiliates
After creating your affiliate program, hiring the right affiliates to market your products or services is the next step. There are a few ways to invite affiliates to your program and promote your physical and digital products. They are:
- Email Marketing: If you have a list of emails, send them emails asking them to be your affiliates. You could request or buy an email list if you don’t have one. You might have a specific group of people you want; you can send them a special mail.
- Social Media: Like Vianetic, they announced their affiliate program on all their social media accounts, with more affiliates. You could try this.
- Websites: People visit your website, so this is quite easy. Your website visitors are potential candidates, and a website is their people can get to know about a new program. Your job is to promote your affiliate program, and it's the affiliate's duty to promote your product. Ensure you add relevant information regarding the program, so any promoter that visits the site understands fully.
- Affiliate Sites: You can join affiliate sites like Rausuren Marketing or ShareASale. These sites open you to several affiliates. Anybody can sign up with them and offer training on becoming a professional affiliate marketer.
5. Manage Affiliates
Constant communication is essential to building a strong affiliate program. After recruiting your affiliates, you need to monitor them and keep tabs on their performance and activity. Ensure the affiliates understands the program and know everything about your brand. You can also give meaningful content they can use like webinars, tutorials, a list of hashtags to keep them on the same page, and pre-written social posts.
Here are some important things to pay attention to when communicating with your affiliates:
- Total payout
- Gross margin
- Number of new affiliates
- Total affiliate sales
- Sales per affiliate
- Total number of affiliates
- Number of affiliates that left the program
- Average order size
- Payout to sales ratio
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Affiliate Marketing FAQs
1. Is There a Difference Between Referral and an Affiliate?
Yes, there is a difference. In referral marketing, people get rewarded for inviting friends and family to try a new service or product. An affiliate is a third party that sends people to patronize a business for a particular commission.
2. What is a Good Measure for Recruiting Affiliates?
The following offers you a good means to recruit quality affiliates for your program:
- Promote your program on your website
- Join affiliate programs
- Send an email to your subscribers
- Promote on social media
We believe you have the answer to your question, “is affiliate marketing worth it in 2022?” Affiliate marketing is an excellent strategy to drive traffic to your e-commerce store and potentially increase sales. The steps above will help you create the best program for your business and get amazing results.
(Contributed by Ayotomiwa Omotosho & Hermes Fang)