Changing faces of affiliate programs?

By Chuck McCullough
Posted Wednesday, November 17, 2004

Its hard to have a discussion about affiliate programs without mentioning Amazon.com. They are considered to be the pioneers of affiliate programs. And with over 300,000 affiliates, its hard to argue that point.

But affiliate programs are changing. Many, many companies are realizing that the best way to sell products and services on the Internet is to recruit affiliates. Along with this comes a form of competition. Affiliate program managers want you to sell their products, not the products of their competitors. How do they make sure that you stick with them and not defect to the other side? They do their best to make their program more attractive to you.

There are many ways to make a program more attractive to potential affiliates. They can offer a higher percentage of the profits, and/or they can offer more benefits. Benefits can come in many forms, but the topic of this discussion will be the benefits that come from the way sales and visitors are tracked.

Let's bring Amazon.com back into the limelight for a minute. They are huge...everyone knows about them...everyone knows that you can create a site, add some good content, bring in a highly targeted audience, and sell them books! Simple enough...create a site with a good topic, drive traffic to it, send them to Amazon, and get rich. But...its been tried before...and guess what...not that many of those 300,000 affiliates even earn enough to get the minimum $25 check in the mail every quarter.

Why? Is it because you have 299,999 competitors out there selling Amazon.com books just like you are? I'm sure that plays a part, but the real reason is the way you are credited for a sale. You work hard to create a website full of content, and work even harder to promote it and bring visitors to your site. Then, what do you do with that coveted visitor? You wisk them off to Amazon to become their life-long customer, and never to return to your site again!

That may not seem fair to you, but can you complain? They give you a whopping 5% of the sale, maybe even 15% on some of the books if you are lucky. Or, worse yet, they bookmark Amazon.com, and go back to buy the books tomorrow and you don't even get the 5%. Either way they are gone. That precious visitor that could have been a life-long customer of yours is now off to Amazon.com. They will buy a book or two to test out the process. Then after their books arrive, they will merrily open up their browser and type in (http://www.amazon.com) and spend their entire paycheck buying books.

How much do you get from this return visit? Well, it WAS your visitor after all, right? Unfortunately every penny of that visitor's paycheck will fall into Amazon's pocket. Of course you have to feel sorry for Amazon, though. They aren't making any money after all (violin music playing in the background).

What happened? The same that happens with many affiliate programs. You get paid per click, per lead, or per sale. From that point on, they own that customer.

But I'm happy to report that times are changing! Companies are starting to look for better ways to compensate their affiliates for referring customers to them.

Don't get me wrong, I'm not condemning affiliate programs...my entire site is dedicated to the topic. I just want you to know that some companies are starting to look at new methods of rewarding you for sending them customers. After all, you are a salesman for them. How many brick-and-mortar companies do you know of that will have a salesperson make a sale, pay them their commission, and then never pay them another cent for future business from that same customer?

Why should the Internet be any different? It shouldn't...and program administrators are finally figuring that out.

There are many companies that will track the visitor that came from your site, and credit you for the sale even if they don't purchase something until the next day, or week, or month. Others will make that visitor your lifetime customer. If they come back two years later and buy something, you will get a commission for that.

A good example of this is Ken Evoy's 5 Pillar Affiliate Program. If you sell one of your visitors a copy of his book: "Make Your Site Sell!" (http://www.sitesell.com/helpmakemy.html), you will not only get a commission for that sale, you will also get a percentage of all future sales from that customer, no matter what product or service they purchase.

A new idea being offered by companies such as Vstore (http://affiliatematch.com/vstore), is to allow your visitors to buy products without ever leaving your site. This means that the visitor has the time to spend on YOUR site, and get to know what excellent content you have to offer, and to hopefully return to YOUR site for future purchases.

This concept allows you to sell products such as magazines, gifts, luggage, hats, cooking accessories from your site, without having to give up the customer that you worked so hard to get.

Here is an example of the power of this idea: I have a site that gives tips and hints for those hoping to become Microsoft Certified. An excellent product for me to sell from that site is books. Everyone studying for this certification will need books at some point or another to help them pass the exams. They come to my site for information, and I sell them a couple of books while they are there. Does pretty well for me, but can I quit my day job? Not exactly. I get a great deal of traffic...highly targeted traffic at that.

I should be rich! I'm not. Problem is, they visit my site, I do my best to sell them on the idea that they will need books to help them study for the exams, then I send them off to Amazon, and they're gone. If I'm lucky, they might remember my site when they get ready for their next exam. But chances are that they will still have the Amazon shipping box sitting on their desk, and will go directly to them to purchase the additional books.

So what can you do about it? Look for programs that will compensate you for future sales, or give you credit for the sale the next day, or month after they first visited them from your site. Or, look for programs that allow you to sell products directly from your site, without the visitor ever having to leave.

About the Author
Chuck McCullough is the owner of (http://AffiliateMatch.com) offering FREE articles, tips, hints, and real-world advice on how to make money with your website. Visit his site or join his FREE newsletter, The AffiliateMatch Informer by sending a blank email to mailto:newsletter@affiliatematch.com