With traditional advertising increasingly becoming a not-so-easy-to-do marketing channel, it’s good to know that affiliate marketing is a powerful way to get your products in front of new eyes. And, you can think of affiliate marketing as a “you scratch my back and I’ll scratch yours” partnership because it’s essentially a reward-based program that encourages partners to promote your product in exchange for a commission of the sale. Win-win!

How affiliate marketing works

Affiliate marketing (or referral marketing; same thing) is a fairly straightforward method of selling digital or physical products. A super-fan customer, industry expert, or brand advocate signs up for your affiliate program and sends visitors to your online store through a referral link. If a sale is made, they get a small cut of the profit—either a flat dollar amount or percentage of the sale.

Is affiliate marketing right for your small business?

The short answer is…maybe. And it might not be the right move for your small business if your profit margin is already low—then giving even more of that away probably doesn't make sense for your bottom line. But, if people are already referring you business then creating an affiliate program might be worth a try.

Setting up your affiliate program

The good news is, setting up an affiliate program is a relatively painless process once you’ve picked your affiliate software (finding the right fit is the hard part). But, once you do, here are the next steps you can take:

Choose your products to sell - You can include all of your products but it’s smarter to focus on higher valued products. A 5% commission on a $100 product is more appealing than a 5% commission on a $10 product (unless your affiliate can send a ton of referrals).

Consider promotions - Give your affiliate partners more ways to generate buyers for your products ​among their followers or customers. Consider free shipping, first time buyer discounts, or “buy one, get one” promotions to sweeten the deal.

Pricing and commission structure - The most common commission rates are between 5 - 30%. Carefully​ consider what your business can afford when determining your commission rate—you want to make sure you stay profitable!

Managing your affiliate program - You’ll need a solid affiliate platform to recruit, track, and pay your affiliates. Many platforms like Share-a-sale, Reversion, UpPromote, and Lead Dyno already have a fully loaded influencer and affiliate package so that you can get going quickly. But there are also more robust website and e-commerce platforms that have this functionality built in like Thrivecart. Look for platforms that allow you to:

• Easily sign up affiliates
• Track performance of each affiliate
• Track coupon codes and offers
• Track and execute product commissions (though sometimes you have to send commissions via PayPal)

Recruiting your affiliates - Okay, so you have your affiliate program set up and ready to go. Now you’ll need…yes, you guessed it, affiliates! Here are some smart places to start your search for affiliates that can help promote your products. The good news is, you’re probably active on all or most of these marketing channels anyway.

• Social media - Let your followers know you’ve started an affiliate marketing program because your super-fans make great affiliates!
• Email marketing - Send an email blast to your email list encouraging them to apply and share the opportunity with others.
• Website - This is an easy one. On your website have a simple-to-find navigation to your affiliate program application. Include details about the program and the benefits of being an affiliate.
• Personally reach out – If there are specific people you think would be a great fit, reach out!

Managing Your Affiliates - Make sure your affiliates understand the program objectives and brand guidelines. Provide them     with content that they can use, including tutorials, graphics, and pre-written social posts. To make sureyour program is successful, keep a close eye on your metrics and tweak the program as necessary. Some metrics  you’ll want to watch (and track in the Performance tab of your Enji account):

• Total affiliate sales
• Sales per affiliate
• Average order size
• Total payout
• Total number of affiliates
• Number of new affiliates
• Number of affiliates who’ve left (it happens)

Now that you have your affiliate marketing program in place, watch the performance over time, but don't forget to give it (and your affiliates) attention! If it’s improving your overall sales, grow the program by adding new affiliates, more products, more affiliate resources, or even increasing the commissions. A little help from others never hurt anyone. Good luck!