Affiliate marketing generates 16% of all online orders1. That’s big business. But what is it, and how can you use it to grow your e-commerce sales? Read on for a step-by-step guide.
How can you attract customers to your website? If you’re an e-commerce business owner in Ireland, chances are that question occupies your mind for a substantial part of the day.
Your online marketing strategy likely includes one, or preferably a combination of the obvious channels: paid-for adverts, social media and SEO optimisation in order to attract customers. But there’s one marketing program that’s a nothing-to-lose option – you won’t have to invest any money upfront, and you’ll only have to pay a fee once a sale has been made. Step forward affiliate marketing.
What is affiliate marketing?
Affiliate marketing involves partnering with a more established e-commerce brand or platform that attracts the type of customers you are looking to entice and asking them to promote your product or service to their audience. In return, you give them a percentage of revenue from each sale they generate, which they take as a commission.
Let’s say, for example, you have an e-commerce website selling luxury sunglasses. You approach a high-end lifestyle blog and ask it to include your product in its ‘Must Have Holiday Buys’ roundup with a ‘click to buy’ link through to your website. Your product gets seen by a larger audience and reaches your target market, which increases your chances of making a sale, and the blog's owner receives a commission for each pair of sunglasses sold. Win-win.
Types of affiliate marketing
Affiliate marketing isn't a one-size-fits-all approach, and there are different ways to partner with affiliates. Depending on their level of involvement with your product or service, you may consider these examples:
Unattached affiliate marketing
This is like a hands-off approach to affiliate marketing, and it promotes your product without having any real connection to it. Additionally, the affiliate doesn't necessarily have expertise in your niche and doesn't claim to have used your product. In a way, it’s a form of simple advertising where the affiliate drives traffic to your website without personal endorsement.
Related affiliate marketing
In this type of partnership, the affiliate has some connection to your product or service, usually through their niche or audience. For instance, a fitness blogger may promote a sports drink, or a tech website may review a new gadget. And while their marketing influence may drive traffic to your site, they don't necessarily have personal experience with your product.
Involved affiliate marketing
This involves a deeper connection between the affiliate and your product because the affiliate has actually used your product. As such, they can vouch for it based on what they experienced personally. This adds a layer of authenticity and trust to your online marketing strategy, as they can provide genuine recommendations and testimonials.
How does affiliate marketing work?
Affiliate marketing operates on a simple principle: you partner with others to promote your products or services, and you pay them a commission for every sale they generate. In a way, it's a performance-based system where you only pay when you see results.
Here's a beginner’s guide on the typical process involved:
Affiliate Partnership: You find affiliates who align with your brand and target audience. These could be bloggers, influencers, or other businesses in Ireland with a relevant following.
Unique Affiliate Links: You provide each affiliate with a unique trackable link to your website, allowing you to monitor which affiliate is driving traffic and sales.
Affiliate Promotion: Affiliates can promote products on social media and their own website or email lists.
Customer Clicks and Purchases: When a customer clicks on the affiliate's unique link and makes a purchase on your website, the affiliate earns a commission.
Commission Payment: You track the sales generated by each affiliate and pay them their agreed-upon commission.
The five benefits of affiliate marketing
Low financial risk – you only pay a commission to your affiliate partner once a sale has been made.
As a small business in Ireland, you can reach a big audience for a much lower cost than paying for impressions.
If you’re selling a niche product, working with a specialised affiliate partner can help you reach your target audience.
Consumers are more likely to buy a product from you if it’s been recommended by a trusted website or someone they value2.
Affiliate marketing can boost your website’s SEO ranking, as it will benefit from the backlinks from your affiliates’ blogs, social pages and websites.
So, it’s no surprise that 80% of marketers consider affiliate marketing a crucial element in their strategies3!
The five cons of affiliate marketing
While affiliate marketing offers benefits to businesses in Ireland, like increased brand awareness and a wider audience reach, it's important to be aware of the potential downsides. Just as with any marketing strategy, there are challenges and drawbacks to consider, including:
Affiliate Dependence: Relying heavily on affiliates can make your business vulnerable to their performance. If your affiliates lose interest or their audience changes, your sales could be affected.
Lack of Control: Because you have less control over how your brand and products are presented by affiliates, there’s a risk of inconsistencies in messaging. Affiliates may even damage your brand reputation if they engage in unethical practices.
Commission Costs: Affiliate commissions can cut into your profit margins, especially if you offer high commission rates or have a large number of affiliates.
Affiliate Fraud: There's also a risk of affiliate fraud, where affiliates use unethical tactics to generate fake clicks or sales to earn higher commissions.
Finding and Managing Affiliates: Building and managing a successful affiliate program takes time and effort. For example, you need to recruit reliable affiliates, provide them with the necessary resources, and track their performance.
How to get started with affiliate marketing
Step 1: Find the perfect affiliate partner
Your first stop when searching for an affiliate partner should be an affiliate network. Think of it as an intermediary who will connect you (the ‘affiliate program’) with thousands of content creators (the ‘publishers’) who can promote your product in Ireland and beyond – everyone from bloggers, to social media influencers, to dedicated discount websites.
Affiliate networks operate as an ‘all-in-one’ solution that will give you technical support to set up your affiliate program, track generated sales, handle commission payments to your publisher(s), and share performance analytics with you (such as customer engagement and sector analysis.) By joining an affiliate network, you won’t have to invest in any additional affiliate tracking solutions.
Beware though; affiliate networks charge fees for their services, so shop around to find one which suits your budget. If you’re a small business, an affiliate network with commission-based fees may suit you better than one with monthly fees so that you only have to start paying once you’re making sales.
Sportswear brand Gymshark4 is a great example of a brand utilising an affiliate network to drive growth. It works with leading network Awin5 to access voucher platforms, student sites and blogs used by its target market of 18 to 25-year-olds. The brand invests time and money to nurture its relationships with these publishers to ensure the content produced is top quality, on brand, and ranking highly in search engines – it even has an academy to support new talent. Publishers are compensated based on their performance, whereas Gymshark can directly attribute sales to them.
Founded in 2012 by British university student Ben Francis, Gymshark has always worked innovatively to ensure maximum returns on its marketing budget. Right from the start, the brand leveraged the power of social media to promote itself, sending free clothes to fitness influencers with large followings, in the hope they’d wear and post about the products.
“Social media has always been an organic and natural process [for marketing], because that’s how we are connecting as friends and how we’re following our heroes. It was a really natural way of showcasing the products, brand and communities we were trying to build online.” - Ben Francis, Gymshark Founder6
Affiliate marketing and influencer partnerships have helped Gymshark build an active community of passionate followers online – achievements reached for a much lower cost than paid-for advertising.
Of course, you might want to skip the affiliate network route and reach out to publishers yourself. Perhaps you have a specific website in mind that you know is a perfect fit for your product, or maybe you’ve discovered a blogger who regularly reviews products from within your market sector; feel free to contact the blogger directly. Either way, remember to perform a thorough analysis of their platform to check their audience demographic matches your desired customers. Tools like SimilarWeb can help you identify a website’s visitor numbers, bounce rate, consumer intent, and demographic makeup.
Step 2: Decide on the commission
Once you’ve chosen an affiliate partner, you’ll need to agree on a commission rate. The more generous you are, the more incentivised the publisher will be to really promote your product in the best way possible. And remember, the return on investment (ROI) you make here goes beyond the initial sale; you’ll have access to new customers you can remarket to time and time again.
Step 3: Add incentives
A good way to encourage customers to buy is to offer them exclusive deals or discounts. They’ll be more likely to click on the publisher's link to your product if there’s a promotional code or limited offer attached, so consider what you could do to attract the customer.
Step 4: Track your progress
As mentioned in Step 1, if you’re running your affiliate program through an affiliate network, you’ll already be given some basic tracking tools to help you monitor sales generated. But, if you prefer to find an affiliate publisher yourself, you can run a tracking program in-house, using affiliate program software.
Affiliate tracking software solutions provide the interface and infrastructure needed to manage your affiliate program, allowing you to set up rules and policies, add products and creatives, track leads and sales, communicate with affiliates, manage payments and more.
Of course, all this comes with a price – either a one-off fee or a subscription – yet you may find that it’s more cost-effective in the long term compared to paying a commission to an affiliate network.
Five affiliate networks to get you started
Want to learn how to optimise your marketing strategy, boost your sales and reach a wider audience? To start, check out these five popular affiliate networks:
Amazon Associates
One of the largest and most well-known affiliate networks globally, Amazon Associates offers an enormous selection of products to promote alongside your offerings. Plus, Amazon offers competitive commission rates (up to 10% for most categories) and provides robust tracking tools to monitor your success.
eBay
With over 1.4 billion live products, eBay is a massive marketplace. And by taking advantage of its network, you can gain exposure to a wide audience of active buyers. eBay offers commission rates ranging from 1% to 4%, depending on the product category, and provides resources to help you effectively promote your listings.
Awin
Access a diverse range of advertisers, including many popular Irish brands like Aer Lingus and Kilkenny Design. Besides, Awin's platform offers detailed performance tracking and reporting, so you can monitor the effectiveness of your affiliate partnerships. They also provide dedicated support to help you maximise your results.
Etsy
If your products align with Etsy's marketplace of unique and handcrafted goods, their affiliate program can be a valuable channel. By partnering with Etsy, you can connect with a passionate community of shoppers who appreciate artisanal products. What’s more, Etsy offers a 4% commission on qualifying sales.
Rakuten
With Rakuten, you can connect with a global network of advertisers, including many prominent brands in Ireland. Plus, they offer competitive commission rates and provide advanced reporting tools to help you track your affiliate marketing performance. Additionally, they have a dedicated support team, meaning you’ll get the help you need in building successful partnerships.
A final – and important – point to consider when choosing an affiliate publisher: remember to look at the bigger picture. If you choose carefully and invest in a partner for the long term, you can build a strong community of brand ambassadors whose promotion of your product will seem more authentic, as Gymshark has done. “[Regarding] the athletes we work with, we want to create a real, strong team that speaks to our values. We work with them for a long, sustained period of time,” founder Ben explains7.
How DHL can support your affiliate business
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