Have you ever thought about giving other people a commission for generating sales or leads for you? This is called affiliate marketing, and you can take advantage of this up-and-coming marketing channel to boost sales or leads while lowering your risk. Not only do affiliate marketing programs help free up your time (since others create and run the advertisements), but it also helps shift the risk away from you since you only pay when a successful sale is made or a lead is generated. The following presentation will teach you the basics of affiliate marketing including what it is, the basic elements of running a successful affiliate program and what you can do to get started right away. As a bonus, we’ll also detail some ideas you can use to create a new revenue stream for your business by promoting others’ products yourself!

1. Formic Media Seminar Series:
Affiliate Marketing
Sponsored by: Hosted by:
Spool Video Formic Media, Inc.
www.FormicMedia.com www.FormicMedia.com
Brian Schatz| brian@spoolvideo.com John McPhee | johnm@formicmedia.com

2. Formic Background
 Launched in 2008 to service small business &
partners
 Incubated by Anvil Media, enterprise SEM agency
 Provide SEO/SEM, social media & web development
services
 Focus on education (monthly Seminar Series)
 7 employees
 45+ active clients

3. Affiliate
Marketing
August 2011
Nick Herinckx
Senior Account Executive
503.595.6050x233
nick@anvilmediainc.com Provided by Anvil Media Inc.
©2011—All Information in This Document is Copyright Protected
Anvil Media, Inc. and the Property of Anvil Media Inc.

4. Nick Herinckx – Senior Account Executive
• 3 years at Anvil Media
• Responsible for most Anvil B2B PPC &
SEO case studies
• Manages own network of affiliate
sites in free time
• Published in AboutUs.org & PPC
Insider
• Technical background in website code
& development
• Grew Borders’ affiliate program 34%
year-over year at 1,400% ROI

5. Overview
1. What is Affiliate Marketing?
2. Types of Affiliate Programs
3. How Does it Work?
4. Starting & Running a Successful Program
5. Types of Publisher Business Models
6. How to Become an Affiliate Yourself

6. What is Affiliate Marketing?

7. Definition
Affiliate marketing is paying someone else to
generate business for you online, where you
only pay for performance.
Section: What is Affiliate Marketing?

8. Publisher vs. Advertiser
Publisher (the affiliate) Advertiser (the brand)
• Promotes your company for • Wants leads/sales
you
• May not have a big budget or
time to devote to marketing
• Often owns a related
website, email list or has • May simply want more exposure
money to test on advertising on other affiliates’ sites
• Gets paid only when they • Pays a fixed amount or a
percentage of a sale to the
accomplish a sale, lead or affiliate only when a sale is made
other action you outline or lead is generated
Section: What is Affiliate Marketing?

9. History
• Amazon invented the concept of affiliate
marketing online.
Section: What is Affiliate Marketing?

10. History
• Affiliate marketing spending is expected to
reach $4 billion in 2016 (Marketing Sherpa)
• Some top brands are affiliate marketers:
Section: What is Affiliate Marketing?

11. Benefits of an Affiliate Program
• Risk is almost all on the publisher/affiliate
• Only pay for results
• No need to be an expert marketer, the affiliate
does all the “creative” marketing
• Ability to gain visibility on some of the
Internet’s top websites
Section: What is Affiliate Marketing?

12. Challenges of an Affiliate Program
• Must promote program when starting
• Must police affiliates to ensure they’re
following your rules
• Some up-front financial investment
• Must communicate with affiliates
• Some technical implementation required
• Build up over time, not a quick fix
Section: What is Affiliate Marketing?

13. Types of Affiliate Programs

14. Cost per Lead (CPL)
You pay for leads generated, typically a fixed
cost up front plus another sum if lead turns into
a sale later on.
Section: Types of Affiliate Programs

15. Cost per Lead (CPL)
Payout:
• $10/lead
• $700% for sale
Section: Types of Affiliate Programs

16. Cost per Lead (CPL)
Section: Types of Affiliate Programs

17. Cost per Sale (CPS)
• You pay only for sales generated, typically a %
of the order total.
Section: Types of Affiliate Programs

18. Cost per Sale (CPS)
Payout:
• 7% of sale
Section: Types of Affiliate Programs

19. Cost per Action (CPA)
You only pay for a specific action taken, typically
a flat amount.
Section: Types of Affiliate Programs

20. Cost per Action (CPA)
Payout:
• $1 per download
Section: Types of Affiliate Programs

21. How Does Affiliate
Marketing Work?

22. The Tracking Process
• Based on links
• Each affiliate gets their own unique links
• When a sale is made, the system can tell
which affiliate referred the sale because the
unique link that was used is tied back to the
affiliate
Section: How Does Affiliate Marketing Work?

24. The Tracking Process
• Just like if you put a
unique phone number
on each business card
you handed out
• Which business card
drove a call? Just look at
the unique phone
number!
Section: How Does Affiliate Marketing Work?

25. Affiliate Systems
• Once you install an affiliate system, the whole
tracking and payment calculations happen
automatically.
Section: How Does Affiliate Marketing Work?

26. Affiliate Software Choices
Affiliate Network Self-Managed Software
3rd party/intermediary Easy-to-use software that
between advertisers and provides all the
affiliates. tracking/technology to run
your own program.
Affiliates
Affiliates
Network
Advertisers Advertiser
Section: How Does Affiliate Marketing Work?

27. Affiliate Software Choices - Pros
Affiliate Network Software
 Immediate access to  Much less expensive
thousands of affiliates  Much better for
 They manage affiliate SEO/increasing site rankings
relationships
 Complete branding control
 Don’t worry about individual
affiliate payments yourself
 Built-in communication tools
 Management team provided
to you (for extra cost).
 Other services provided (for
extra cost)
Section: How Does Affiliate Marketing Work?

28. Affiliate Software Choices - Cons
Affiliate Network Software
Expensive to start Don’t have access to
Must pay fixed fees to thousands of affiliates
affiliate network monthly immediately, must work
For affiliates to join, they harder to promote the
must be a part of the program
network you choose Manage payments yourself
Manage affiliate
relationships & support
yourself
Section: How Does Affiliate Marketing Work?

29. Affiliate System Choices
Affiliate Network Software
Section: How Does Affiliate Marketing Work?

30. Starting & Running a
Successful Program

31. Step #1: Affiliate Network
Choose an affiliate network or choose your
affiliate software
Section: Starting & Running a Successful Program

32. Step #2: Competitive Research
Must research companies like yours that have affiliate programs so
yours will be competitive.
Questions to answer:
1. How much do competitors offer for commissions?
2. Are commissions 1-time or recurring?
3. What kind of resources do competitors provide their affiliates?
1. Banner ads
2. Videos
3. Drafted emails
4. Custom landing pages
4. How long after a visit is generated will competitors pay for sales
from that visitor?
5. What kind of advertising techniques do competitors disallow?
6. How often do affiliates get paid?
Section: Starting & Running a Successful Program

33. Step #2: Competitive Research
Tip: Most companies who run an affiliate program have a
“partners” page or “affiliate” page which outlines the answers to
these questions.
Section: Starting & Running a Successful Program

34. Step #2: Competitive Research
Example: Benchmark Email
Section: Starting & Running a Successful Program

35. Step #3: Affiliate Terms & Conditions
• Your affiliate program Terms will dictate the
rules of your program.
• Keep in mind that these rules must be
enforceable
• These rules need to be in-line with or better
than your competitors
Section: Starting & Running a Successful Program

36. Step #3: Affiliate Terms & Conditions
What to Include:
1. What exactly constitutes a commissionable event?
2. What are your commissions? % or Fixed?
3. 1-time payment or recurring payments?
4. How many days will you attribute a sale to an
affiliate?
5. How often will you pay affiliates? Do they have to
reach a commission balance before payout?
6. Do you accept international sales/traffic?
7. How are they allowed to promote your program?
What’s prohibited?
Section: Starting & Running a Successful Program

37. Step #3: Affiliate Terms & Conditions
How are They Allowed to Promote Your
Program?
1. Can the affiliate use your brand name? In
URL, in ad text, in creative?
2. Can the affiliate bid, in PPC, on your brand
name?
3. Can the affiliate use PPC, SEO, social media,
email?
4. Will you accept incentivized traffic?
5. Can affiliates promote you with pop-ups?
Section: Starting & Running a Successful Program

38. Step #3: Affiliate Terms & Conditions
Example: Brand Name PPC Bidding
Section: Starting & Running a Successful Program

39. Step #4: Affiliate Support Materials
• Banner ads
• Drafted emails they can use
• Reports they can promote with your links
inside
• Videos
• Custom landing pages just for affiliates
• Data feed (for eCommerce sites)
• Customer testimonials they can use
Section: Starting & Running a Successful Program

40. Step #5: Promote Your Program
• Create a page on your website for the program
• Search for relevant sites in your niche and reach
out to their webmasters soliciting participation.
– Complimentary services
– Current partners
– Review websites
– Deal websites
– Personal blogs
• If in affiliate network, pay to send out a mass
email to publishers in a specific vertical
Section: Starting & Running a Successful Program

41. Step #6: Management Ongoing
• Typical time commitment: 1-2 hours per day.
• Approve or deny publishers that apply
• Answer publisher questions or issues
• Accommodate individual publisher requests
• Police current publishers to ensure compliance
Section: Starting & Running a Successful Program

42. Types of Publisher Business
Models

43. Coupon Websites
Section: Types of Publisher Business Models

44. Lead Farms
Section: Types of Publisher Business Models

45. Review Website
Section: Types of Publisher Business Models

46. Cash Back Website
Section: Types of Publisher Business Models

47. Virtual Currency
Section: Types of Publisher Business Models

48. Incentive
Section: Types of Publisher Business Models

49. Arbitrage
Section: Types of Publisher Business Models

50. Blog
Section: Types of Publisher Business Models

51. How to Become an Affiliate
Yourself

52. Step 1: What Would Help Your Customers?
• Decide what types of companies you want to
promote before looking for offers.
• Examples:
– A website design company can also promote stock
photo websites or website hosting companies
– A recycling center could promote green home
products
– Yoga instructors could promote online stores
selling Yoga equipment
Section: How to Become and Affiliate Yourself

53. Step 2: Determine Promotion Strategy
• How will you promote the other companies in
a way that customers will appreciate?
• Examples:
– Free guide you can offer that includes links to
affiliate offers
– Occasionally promote them via your current email
list
– Place them in a “resources” or “recommended
partners” section on your website
Section: How to Become and Affiliate Yourself

54. Step 3: Join Affiliate Network
• Apply to an affiliate network (like
www.cj.com) to browse offers/companies you
can promote.
Section: How to Become and Affiliate Yourself

55. Step 4: Apply for Offers & Get Links
• Browse through companies inside the affiliate
network and apply to them.
• Once accepted, include their provided links in
your promotional materials!
Section: How to Become and Affiliate Yourself

56. Review

57. Review
1. What is Affiliate Marketing?
2. Types of Affiliate Programs (CPS, CPA, CPL)
3. How Does it Work?
4. Starting & Running a Successful Program
5. Types of Publisher Business Models
6. How to Become an Affiliate Yourself

58. Questions?
Thank You
Contact Information
- nick@anvilmediainc.com
- 503.595.6050 x233
- Twitter.com/nickherinckx
- LinkedIn.com/in/nickherinckx