If you have just started your dropshipping business, you probably will be having issues with generating a high volume of sales consistently. One way many businesses try to keep their sales volume high is through affiliate marketing. If your profit margin is high and your affiliate marketers earn good commissions, you can be sure that your business will see a positive boost within a short while. In this article, we help you see if affiliate marketing will work for your business, and how to go about it.
How Do Affiliate Marketing Programs Work?
You may have asked, What is an affiliate program? Affiliate marketing programs offer marketers commissions for promoting and generating sales through unique affiliate marketing links. For example, if an individual registers as an affiliate marketer for your business, the marketer gets a unique affiliate id and link. The affiliate id and link are used to track the marketer's activities and to confirm if sales were generated as a result of those activities.
Once a sale is generated, the affiliate marketer is paid a commission for the sale. The commission paid may be a fixed percentage on the price of products sold or a fixed price on each product.
Affiliate marketing is a good marketing strategy for businesses that have a high-profit margin. Since you will have to pay your marketers encouraging commissions and benefits, affiliate marketing is not profitable for products that have low margins. Decide if your business will still flourish despite paying commissions to your affiliate marketers.
How to Start Affiliate Programs for Dropshipping?
If you have decided that the affiliate marketing program will work for your business, your next concern is how to begin. Here is a complete guide to follow.
1. Run an Affiliate Program Competitive Analysis
This is the first and most important step that will determine your success at affiliate marketing. You will always have competitors in whatever niche your dropshipping business falls. It is time to evaluate your business with the competition so you can determine how you can leverage affiliate marketing programs.
Decide which competitors to use as a reference to get a clearer picture of your market, choose 2 or 3 competitors, 2 brands, and 1 complimentary business (less competitive but appeals to a similar audience).
For instance, if you dropship kitchen equipment and appliances, you can use this template.
Competitors: Shineuri Kitchen, Kitchen Universe, Material Kitchen
NB: The competitors you consider must have an affiliate marketing program that you can compare for proper competitive analysis.
Brands: Kitchen Aid, General Electric
Complimentary business: LG
Compare your competitors' price with yours
Get a book or clean paper. List a few of your products and write your current selling price beside them. Head to your competitors' websites and record the price of the same items you sell. By comparing your price with the competition, you may begin to understand why your competitors can offer high paying affiliate programs.
Study their affiliate programs
Check the following information about your competitors
Network: Which platform do they use to run their affiliate marketing program? An example is ShareASale
Paid Actions: What affiliate actions are paid for? Some high ticket affiliate programs pay affiliates only when a sale is made. Some include pay per lead, email submission, and subscriptions.
Commissions: Are the commissions based on a fixed price per sale, or percentage? Check if they also offer bonuses to affiliates for reaching certain milestones.
Cookie Length: This is the period affiliates get paid for actions taken on their affiliate tracking links. Some top affiliate programs pay for lead generation and sales.
Terms: Check rules and regulations on allowed media for promotion, affiliate requirements, and disclaimers.
Evaluate your findings
Think like an affiliate marketer. Compare the competitors' programs and highlight their strengths and weaknesses. For instance, consider cookie length, approval duration, high/low commission rate, multiple/limited promotional materials, etc.
Run a complete SWOT analysis of the competition.
Create your model
You should have learned a great deal from comparing your competitors. It is time to use this knowledge to create your unique affiliate marketing program. Make a plan on how to run all the important aspects of your affiliate marketing program.
2. Decide on an affiliate platform
There are lots of platforms that can host your affiliate marketing program. Choose one that helps you stick to your affiliate marketing plan.
3. Find the right affiliates
This is one of the major challenges for new businesses. Start by telling people around you who sell products similar products. Find local niche bloggers and offer an extra incentive so they can help promote your products and affiliate program. Run adverts on social media channels to attract more affiliates. Include an Affiliates section on your website so that interested visitors can apply.
4. Manage your affiliates
Research has shown that communication via email remains the most effective means of managing affiliate marketers. You can seek ways to automate your affiliate management strategies. Be sure to keep your marketers updated when important events or information surfaces.
Best Platforms for Launching Your Affiliate Programs
Below are some of the best affiliate marketing programs you should consider if you want to start an affiliate marketing program.
1. Refersion
This platform quickly automated and launch your affiliate marketing program. Most of the work is done for you while you just oversee the entire process. Refersion partners with influencers, bloggers, brand promoters, and ambassadors.
Supports: Great For BigCommerce, Magento, Shopify, and WooCommerce;
Pricing: $29 per month for 30 affiliate order maximum. $89 per month for 130 affiliate order maximum.
2. ShareASale
This is a leading affiliate program marketing platform that offers efficient solutions for multiple platforms. It has a reputation for being customizable, fair, fast, and honest. Most of the best affiliate programs use ShareASale.
Supports: Almost all e-commerce platforms and software applications;
Pricing: one-time setup fee of $550. A minimum deposit of $100 to cover affiliate commissions.
3. AffiliateWP
Create an affiliate marketing program on your WP e-commerce store. Get all the WP plugins you require for effective affiliate marketing campaigns easy and fast.
Supports: WordPress users;
Pricing: Ranges from $99 to $249, depending on the number of Pro add-ons and the number of WP sites to run the plugins. An unlimited plan costs $499 per year.
Call to Action
Before you can see positive results in your affiliate marketing program, you may need to wait a while. With a good affiliate marketing strategy, you stand a better chance of increasing your sales and profit. In the long run, you save costs on advertising and position your business for autopilot profits.
