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Affiliate Marketing- Part II

"20% of your sales force produces 80% of your company revenues" - Vilfredo Pareto, Economist.

This is one rule that definitely rules the world of Affiliate marketing. While a company may boast of a high volume of affiliate base it enjoys, the fact lies that only 20% of that base are the actual driving force for the sales of that company.

Leaving that cliched statment, lets talk about the more obvious question which is, Why does it hold true and more revelant for affiliate marketing. 

The answer to that lies in the fact that most companies always tread the usual road and well, slowly dissolve into the already burgeoning pit of companies that are into afiliate marketing.

How often have you seen a company that is proactively involved in the affiliate marketing promotions? Not many right?

One major mistake made by most companies, rather almost every other company is that they do not experiment with new ideas. True affiliate marketing is a vast subject and at some point the company does lose its focus once the affiliate base starts to build up.

A few suggestions for companies that are into affiliate marketing.

1. Eliminate the 80:20 Rule.

Lets take an example of a company that would want to launch its affiliate marketing program. The usual way is to do an e-mail campaign coupled with some CPM deals on portals. The end result of this exercise would be to just increase the affiliate base. While the above 2 exercises would be a good way to begin the program, it does point to one gaping loophole. It opens the doors to 80% of junk. By junk, I mean to say sites/webmasters who sign up just for the kick of it. They promote the product with enthusiasm initially and later it dies down.

To eliminate the 80:20 rule, companies should focus on building a niche market rather than concentrate on increasing its reach to more affiliates. To begin with, proper research needs to be done with regards to the really good quality sites. These sites are the ones which enjoys a good viewership, good hits, a loyal and a targeted customer base.

When a company focuses on sites and has a proactive approach, what they can discover is an entirely different market which is more focussed and sales driven. These sites could vary from portals, information sites to personal webpages. Although the downside in this is that you would not be able to see a great increase in your affiliate base. The advantage though is that you just get a step closer to a better balanced ratio of sales versus total workforce.

2. Personalization from the beginning.

I have a question to ask you. Except for the top 50 or 100 performing affiliates, how often would a company contact its other affiliates. I am not talking about "Personalized Auto Generated E-Mails," but a mail that is drafted by a person from the other end? By keep in touch with the affiliates the company can learn a lot and also help the affiliate generate business. Word of mouth marketing is cost effective and can produce amazing results.

3. The psyche of an affiliate.

Most companies write of affiliates who do not generate any sales in the first quarter of signing up. This is a dead situation as both the parties would have lost interested. However, a little retrospection into this will show something else. Most affiliates who sign up do not know the technical details for setting up the banners, etc. Instead of having a generic FAQ page, customization is the keyword here.

Companies will need to monitor the affiliate's path on the site and contact them accordingly. For example a person who signs up as an affiliate and then logs into the system, clicks on the banner links and then logs off. If this happens way too often, (and im talking of not more than 2 times) there is something seriously wrong. If a company can take this opportunity and provide support to the affiliate, trust me, you have one person who is going to be all praise for you.

4. Custom deals.

Another most common fact is that companies provide custom commissions only to affiliates who bring in higher volumes of sales. While many people do know that a company would not limit itself to the commission type it displays on the site, the company also needs to approach the affiliate and negotiate a custom deal that will be appropriate for the affiliate. Most often it happens that companies tend to either overquote or underquote the deal. Perhaps a little more research into the market and the affiliate himself would provide a better insight.

5. Special promotions.

Now, I would not call these anything special, far from being called a promotion. For most companies, a special promotion would mean giving the affiliate an extra amount for a set number of sales brought to the company in a specified timeframe. What is the use for having a special promotion when your infrastructure is still the same?

It would take anywhere between 2 to 3 quarters before a company can consider offering you a special promotion. Apart from the usual custom of offering extra commissions or increase discounts, it would be a better idea to actually gather information from the affiliate. If a company assigns an account manager for an affiliate, 2 to 3 quarters time is more than sufficient for the account manager to be able to guage the requirements of their affiliate. Companies will have to move out from the usual and experiment more in terms of the likes and dislikes of the affiliate so that it would fit well into the system and at the same time not lose the focus from the affiliate.

While most companies always rely on the same roadmap towards having a successful affiliate program, this sector needs companies to experiment with new ideas and innovative campaigns to give a facelift to the affiliate programs.

About the Author

John Benjamin works as a freelance consultant for Internet marketing and has his website at http://www.promindsinc.com/

A complete list of articles can be found at his forum http://www.promindsinc.com/bb/

John Benjamin (ProMinds Inc)

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