An "affiliation" is an agreement between two parties in which one party sells the products or services of the other party in exchange for a commission. Even with a competitor, a good online affiliation programme can boost sales by a lot. The owner of the product wins when more people buy it, and the affiliate wins when they get a commission.
The affiliate doesn't have to make or ship the product that is sold. They don't even have to get the money. All of this comes from the person who owns the product. This is a big plus for the affiliate because there aren't many costs to get started. Affiliates who are just starting out should focus mostly on promoting their own products. Often, the owner will even give the affiliate information about how to market.
For online sales of goods, the affiliate gives the customer a URL link that they can click on. This link goes to the website of the product's owner and has a special code that lets the affiliate get credit for the sale. Depending on the affiliation agreement, the credit can be anywhere from 0 to 50% (or more) commission.
Some of the ways an affiliate can boost sales are:
- Add reviews from actual customers. (Make sure to get permission from the customer first.)
- Market unique products with unique web sites. This makes the product stand out.
- Add the email addresses to a list of people who chose to join. From that list, send multiple emails to raise awareness of the product and, eventually, to make sales.
- Give them something for free in exchange for their email address. People love getting things for free, and if they like what they get, they may buy something from you in the future.
There are benefits for the affiliate, such as:
- There's no order taking. Someone else sets up the merchant accounts and gets the money from the customers.
- Shipping is free. The customer gets the product from the other person.
- Don't touch the product. The product is given to the customer by the other party.
- Low costs to start up. The other party comes up with the idea and makes the product.
- If the product doesn't sell, get rid of it and move on.
- There is no stock. This is done by the other side.
- There are no warranty costs later on. All customer commitments are taken care of by the other party.
The main benefit for the producer (the other person in the relationship) is more sales because more people see their products.
If an online affiliate programme is done right, both the producer and the affiliate will benefit.
Jim McCabe