4 Effective Ways to Reduce Your Affiliate Marketing Risks
If you’re an e-commerce business and you’re looking at adding affiliate marketing to your digital marketing strategy, then great news! You’re opening up a new channel that could potentially add 15% to your online revenue.
The next step is how to enter the channel prudently. Is there a ready-made audience for you to tap into? Are there partners that fit well with your brand? Can you be profitable from your first sale? Who should you work with to launch and manage your programme? Do you have the expertise inhouse or do you need additional support from an affiliate marketing agency?
Plenty to work out, but at the heart of your decision making should be the aim of reducing your affiliate marketing risks and making the channel a long term success.
So how do you go about reducing your affiliate marketing risks?
We’ve put together some pointers for you to try and do just that…….
1 – Seek Expert Advice
Whether this is just to consult on your readiness to enter the channel or to help launch and manage your programme, speak to people with industry experience. Affiliate marketing has a lot of nuances and existing relationships are very important in making your programme successful.
The channel works very differently to a Google Ads campaign launch or a social media campaign, so understanding what it takes to get live and how to start nurturing key partnerships is vital. Experts can help you to understand this and make good decisions at the start, that will give you the chance to enjoy long term success.
2 – Understand Your Costs and Commitments
The affiliate channel is a performance marketing channel, so the partners involved are all rewarded for each sale/lead/sign up you receive from the channel. Before you get started it is vital to fully understand what your cost will be for each sale, and you need to account for everything from affiliate commission to network costs as well as discounting on the price of the products.
You also need to look at any set up costs, deposits and fixed monthly costs that you need to factor into your budget. You also need to be fully aware of the length of your commitment initially, your payment terms to affiliates and
As with any channel, you want to make sales that are profitable, so setting up a channel that delivers you sales with a healthy margin from the first minute of being live is vital.
3 – Work With a Range of Partners
Whilst every programme will have certain partners that perform better than others, be that because of the sector or the type of rewards you offer affiliates, it is important to spread where your sales are coming from.
Cashback might be a great source of revenue for you, but making offers available to your voucher and deal site partners so they promote you, having a strong product feed so price comparison or CSS partners can work with you and engaging with influencers relevant to your product range are all great ways to spread where your traffic and sales come from.
4 – Competitor Research
You need to have a solid understanding of what your competitors are doing to give you insight into what your potential audience will be expecting from your brand in the channel.
By doing this due diligence you can understand the type of offers you might need to be running, work out an acceptable commission rate for affiliates and who the key partners will potentially be for your brand. It’s just another way to reduce your affiliate marketing risks when launching your programme.
As an affiliate marketing agency, Fuel is well versed in going through this process of taking programmes into the affiliate channel and helping to negate as much affiliate marketing risk as possible.
We focus on a performance-led offering, where costs are based purely on a percentage of the sales made through the channel. By doing this, we eliminate a lot of the barriers to entering the space there can be. We don’t charge set up fees or look for deposits, and we partner with a great affiliate network in Adtraction in the UK to allow us to avoid any fees to get going.
By working with Fuel and Adtraction, we allow brands to make profitable sales straight away and allow the programme to have time to grow and develop without the pressure that expensive setup costs can bring.