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Affiliate Marketing: A Primer For Social Entrepreneurs

January 22nd, 2010  |  Published in Marketing  |  4 Comments

Socentex.com has been on hiatus for the past week, you might have noticed.  While the rest of the world was tweeting, re-building, and being unreasonable, I attended the Affiliate Summit West conference in Las Vegas, a conference bringing together advertisers, publishers, and merchants all dedicated to the use of affiliate marketing to further their businesses.  When I’m not writing posts for Socentex.com or tweeting for The Hub LA, I work as an affiliate marketer.  It’s a great career in a young, burgeoning industry.  Affiliate marketing will be the standard in twenty years.  But until the rest of the world catches up, I’ll let you social change leaders in on the secret.

Affiliate marketing, otherwise known as performance marketing, works in the following way.  You want to sell more products.  An affiliate marketer takes some ad creatives that you create (or creates his own), and then goes to work marketing for you.  He might create a blog about your products.  He might put an ad up on the right-hand side of Google.  He might even advertise on Facebook.  As a result of this advertising, your business earns extra sales of that product of yours.  Your payment for the affiliate marketer’s work is simple:  you pay him 10% of each sale.

Pay-for-performance marketing works so well because you, as a business leader, don’t pay for the actual marketing efforts.  Whether the affiliate marketer spends 10 hours or 500 hours creating your advertising campaign is irrelevant.  Same goes for the amount of money they spend on advertising – it’s all on the affiliate.  For you, all that matters is results.  And you only pay your affiliates when you make the sale.

Sound too good to be true?  It’s not only reality, it is growing fast.  Companies like Toms Shoes have affiliate programs (see that ad on the right of this blog?  Whenever someone makes a purchase from following that ad, I get 10% of the sale – same goes for the link I just posted to), as do mainstream companies like Macy’s, or Sandal’s Resorts, or Patagonia.  All of these companies, and thousands and thousands more, have affiliate marketers doing the leg work for them, and they only pay when their sales go up.

Big affiliate networks like Commission Junction, ShareASale, and LinkShare, are great places for companies to go when seeking to create an affiliate program.  And they handle companies large and small.  The big value-add about affiliate marketing is that it’s all metrics-driven.  You don’t have to worry about a big ad spend without a quantifiable ROI.  You only pay for more sales.  So long as your margins are sufficiently high, an affiliate marketing program means pure extra profit for you.  And best of all, because you’ve outsourced your marketing efforts, you have more time to dedicate to the fundamentals of your business, all while sales increase and your brand’s name grows.

Affiliate marketing is eminently scalable, gives you control over message, and frees up time to work on the main aspect of your social enterprise – helping people.  Please ask questions and I will be writing about affiliate marketing and how it can apply to social enterprise in the weeks to come.

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Responses

  1. Tweets that mention Affiliate Marketing: A Primer for Social Entrepreneurs | The Social Entrepreneurship Exchange | The Social Entrepreneurship Exchange -- Topsy.com says:

    January 23rd, 2010at 5:45 pm(#)

    [...] This post was mentioned on Twitter by Auren Kaplan and Auren Kaplan, Douglas Bachelor. Douglas Bachelor said: RT @socentex: Want to Know How Affiliate Marketing Can Help Your Social Business? A Primer: http://is.gd/6QNJv #socent #marketing #strategy [...]

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