Calculating The Value Of An Affiliate

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August 16th, 2010 by Click Consult

When you are introducing an affiliate marketing programme, it is extremely tempting to offer high commissions to ensure you attract the very top-performing affiliates. However, before deciding how much you are willing to pay, you should calculate just how much you can afford to pay.

Do some simple calculations to work out your profit margin before looking at your competition in the market to see what you are competing against. Look at the amount and frequency of commissions being paid by your competitors to see if you can match their percentages. If you can’t afford to be competitive and match the level of commission, you could offer an alternative incentive such as monthly prize draws or a higher standard of promotional materials.

Many affiliates will consider the quality of a product before agreeing to become an affiliate, so it is worth spending extra resources on internet marketing your product so that it will be an attractive purchase. Merchants should also consider the frequency of payments and the payment methods as this can also be extremely important to an affiliate. Being paid monthly with a desirable payment method of their choice may persuade the affiliates to accept a slightly lower commission.

Here at web marketing company Click Consult, we help you to decide what level of commission you should pay and will also deal with your creatives so that you can deal with other areas of your business. Outsourcing to a company such as ours will increase your return on investment in the long term.

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