Traction: A Startup Guide to Getting book has “affiliate marketing” as one of the traction channels and this is the subject of this blog post (build from this week’s edition of the newsletter – 3ThingsThisWeek).
An affiliate program is an arrangement where you pay people or companies for performing certain actions (like making a sale or getting a qualified lead). Affiliate programs are frequently found in retail, information products, and lead generation.
Some of the advantages of using this channel are:
- You only pay for results – unlike traditional advertising methods, affiliate marketing is the most cost-effective one. If your affiliates don’t perform and bring leads, they simply don’t get paid.
- You don’t spend time on advertising – let others do the work for you so you can worry about other, more important issues, or issues that you have skills for. You don’t need to be a marketing expert, neither you have to learn any marketing methods to run an affiliate program.
- Get lots of traffic and improved SEO – lots of affiliates generate lots of backlinks.
- Find Super affiliates and you’re golden – you don’t need hundreds of affiliates to successfully run an affiliate program. In general, most of the businesses have 3-5 Super affiliates who generate more than 50% of the revenue from their whole affiliate program.
Affiliate marketing is great for a startup or someone who wants to grow faster, who doesn’t want to take the risk and spend money on marketing. If you want other people to drive sales for you, and you only pay them for results, it’s a great deal. There’s little to no risk. Read this article on why affiliate marketing is a great traction building channel for start-up businesses.
Thing #2: Affiliate Programs-Traction Channel
Affiliate marketing is a type of performance-based marketing in which a business rewards one or more affiliates for each visitor or customer brought by the affiliate’s own marketing efforts. The industry has four core players: the merchant (also known as ‘retailer’ or ‘brand’), the network (that contains offers for the affiliate to choose from and also takes care of the payments), the publisher (also known as ‘the affiliate’), and the customer.” This article gives more insights into affiliate marketing channel.
Thing #3: Affiliate Marketing with David Quiec
In this video, David Quiec, Customer Acquisition & Demand Gen, Distribution Hacker in Residence for 500 Startups talks about affiliate marketing foundations – pay for performance, Types of affiliates, types of programs, pros & cons. In the context of startup businesses, he talks about what success looks like in this channel and gives you tips on the best practices for affiliate programs.
I would love to hear about your experiences and challenges in using “affiliate marketing” as a traction channel. If you have some success stories in using this channel, they will be great stuff to share with others trying to explore this.