An affiliate program is a revenue sharing system used to increase a website's traffic and sales by paying other website owners a commission once their referred visitor makes a purchase. In terms of cash, it is generally a cost effective form of Internet advertising because, traditionally, you only pay an affiliate when their referral fulfills the desired action (submits a form or places an order) on your website.

Having an affiliate program provides you with a tool to create profitable partnerships with complimentary offerings that provide visitors with a "virtual mall" or "one stop shop" and add value to your online business. Creating these new, untapped relationships can increase your online sales.

When deciding to start an affiliate program, you should consider the following:

Is your company's product/service in demand?

The products that perform best for affiliate programs are those that traditionally function well in an e-commerce setting already, such as reading materials, music, games, etc. Well producing programs usually offer products/services that require little explanation above what you detail on your site, are easily packaged and shipped, and are high-quality.

Is there a market for your program?

You can answer this question simply by doing some research on your industry. If there aren't many affiliate programs targeting your customer base, you are in a great position to launch your program. If there seems to be a good number, you could consider ways to set yourself apart from the competition or create a new product/service.

Can your program provide something unique over your competitors?

Though other programs are targeting your market, you can improve upon them by providing an additional service, better support, higher commissions, etc.

Do other sites want to sell your product or service?

You can be assured that there is a huge demand for your program if you have been approached by other sites wanting to sell your product. Otherwise you can approach sites you feel would be great partners to determine if they would have interest.

What commission do you want to pay?

When determining a fair commission you can take the following factors into consideration:

  • The type of product/service you are selling
  • The action you want visitors to take
  • The cost of that item/action
  • Overhead
  • Desired Profit

Keep in mind that you can increase commissions as your revenue grows, which demonstrates the mutual benefit of your program to your affiliates, and serves to motivate their promotional activities. The key is to come up with a comfortable starting point that doesn't leave you reducing commission to stay afloat.

Once you have set an attractive commission, have a quality product, quality affiliates and a listing in a reputable directory, other quality affiliates will flock to your program, providing enough revenue in sales to more than break even on our low cost affiliate program software.

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