Voted #1 Affiliate Software
While affiliate marketing management tools are imperative to running a smooth network, integrating a worthwhile commission rate makes sense when you need your affiliate users to drive your business to financially rewarding levels. Not only must your payment transactions be set up with a secure merchant service program, but you must also consider every detail of your commission payout system for new affiliates, long-term affiliates, and super affiliates.
Commission rewards are set on several levels including private rate establishments. However, other payment rates include those that involve fixed rate commissions, percentage rate commissions, lead programs and commissions for super affiliates. The same commission rates set for super affiliates can also be expanded to include the activity of affiliate users that are heavy hitters. Even so, all rates for affiliate-generated commissions call for meticulous consideration.
When you also figure in the amount of commission rates for affiliate partners, it also means considering the profitability of all individual items, including big-tickets items, e-books, credit cards, or even other services that involve marketing. Calculating commission rates also means allowing space for promotions and special offers for new affiliate and for those will quickly become long-term partners. Time-sensitive commissions are also a practical solution to motivate existing affiliate partners and new affiliate users.
A workable commission rate means creating an effectual plan which draws in your affiliate partners, but still helps you to generate the profit margin that makes your business float. As an affiliate manager, it is not always a necessity to applying the best default commissions to your affiliate marketing program in the beginning. In fact, an affiliate commission rate based on a gradual process that increases over time may be just what your business needs to spark incredible motivation among your affiliate users. Although every affiliate payment system does not work the same, you will need to make sure that your rates remain competitive enough to capture the marketing partners that your business needs.
Lead and Fixed-Rate Commission Programs
Affiliate users understand that fixed-rates are one-shot deals, but that they can duplicate the sales process as many times as they desire. New affiliate users may be more accepting of lower rates initially to get their business going.
Some affiliate managers believe that the best initial rate to give affiliate uses for fixed commissions is within or at the 20% margin. Yet, when you are a new affiliate manager, consider giving your partners from 15% to more than 24% for fixed-rate commissions. This means that new affiliate users may receive payments on the lower end with incentive increases based on level of activity and length incentives.
To maintain affiliate user acquisition, it is best to start off with a rate that you can continue for the length of your partnership existence. Therefore, during slow economic times, you won't have to concern yourself with lowering commission rates, which will most likely deter some of your affiliate users.
Percentage Per Sale Programs
The percentage per sale can boost the income of the affiliate user and can motivate them to advertise within new avenues. Yet, setting the amount for a percentage per sale is a very vital task when you consider the lifetime of your business, and especially the motivation of your affiliate users. Depending on how much you will make as an affiliate manager, the best rule of percentage per sale is to give your affiliate users a significant piece of the financial pie.
Why is it important to have generous relationships with your affiliate users? Besides motivating them to display links and buttons, you also want your affiliate users to explore new avenues of advertisement. When your affiliate users understand that lucrative profits await them, as they share your products and services over several website paths, this always means more exposure for you.
Even so, when it comes to percentage per sale, this can add up to a significant amount for the affiliate user. Usually, some affiliate managers will stretch out 25% to 30% to pass on to affiliate users for percentage per sale volume. Yet, these percentage amounts are usually reserved for products and services for which the affiliate manager only receives a small profit from over time. However, for big ticket items, where you make up to 50% to 95% of total sales volume, you can raise the percentage per sale to 49% or higher. Still, leaving space for the increase of your percentage per sale can leave you with an advantage when your affiliate users quickly become super affiliates or heavy hitters.
Super Affiliates and Heavy Hitters
As affiliate managers, you understand that heavy hitters and super affiliates make up a larger portion of your financial volume. Because of this fact, don't allow competitors to get an edge on you, because you are not taking care of your heavy advertisers by offering larger financial incentives. Let's face it; your super affiliates are working your business into overtime. They plant more of your banners, page peels, and light boxes than any of your other affiliate users, and therefore they deserve more.
How much more do your super affiliates deserve to receive from their efforts? Some super affiliates will not consider your program if you are not paying more than 49%. In fact, some actively seek our affiliate marketing programs that pay more than 70% to users. When you consider the amount of exposure that heavy hitters and super affiliates give your business, paying 76% to 80% of your affiliate manager profits is worth the payout over the long haul.
When you consider your profit margin, the 20% to 30% that you keep from affiliate marketing sales can keep your trade open, especially since affiliate users bring your business a hefty customer base. Just like with other affiliate programs, leave enough of a margin open to increase the profitability of your super affiliates over time. Withholding 12% to 20% of the maximum amount of payouts will work, and then you can release these amounts after the time-limited commission period is over.