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How To Set Up A Powerful Affiliate Program

Affiliate programs (also known as reseller programs, associate programs, etc.) are an opportunity for you to get hundreds, even thousands of web sites all driving traffic to your site and making sales for you...

And the best part is you don't pay until AFTER they make the sale!

That's the opportunity (and it really is a great one) but I'm going to give you my realistic assessment from actually doing it. In only a few years I've built a sizable affiliate network of 28,422. Right now my affiliate program accounts for 50% of my traffic and 40% of my sales so obviously I'm very happy with the results!

It's been a tremendous success starting with the first month. It brought in approximately $2900 in sales and I paid out $1400 in commissions. From my start-up costs of $650 ($450 for software and $200 for additional design work) this came out to a $900 profit, or a 138% return on investment (ROI) in the first month. Six months later, it provided me with a 1900% ROI and I know it will continue paying off for many years to come.

Let me give you a little background first and then we'll go into specifics of using this powerful strategy. was one of the first companies to build an affiliate program and right now they've got approximately 150,000 affiliates working for them, just sending them visitors and customers. Their affiliates get paid every time someone clicks on their link and buys a book.

I believe created their own software to run their program - but now there are several companies that can provide you with affiliate software to run your own affiliate program.

There are two ways you can start your own affiliate program. The first way is to have a service bureau take care of nearly everything for you. They'll handle recruiting (to an extent) and administrative functions like sending out checks, tracking, reporting, etc. But normally, you'll pay a much higher percentage than if you did it yourself (which is the second way) - in fact, a very healthy percentage in many cases. If you don't think you can handle some of the administrative tasks of running a program in house then you should consider outsourcing to a company like Commission Junction (

The second way is buy your own software and run it in-house (that's what I do).

Affiliate Software For In-House Management (Platinum member Corey Rudl's software) (Software combines digital delivery, shopping cart and an affiliate program. This is what I currently use.) (Software that gives you an affiliate program, shopping, database systems and an affiliate program all together in one.)

It's the software that is making the Web such an exciting and easy place to set up your affiliate program. It makes it completely easy to track 100, 1000, even 100,000 different affiliates' sales. Try doing that in the offline world without a major headache.

How To Build A Successful Affiliate Program From Scratch

1. Good Product This goes almost without saying but I'll mention it again - you've got to have a good product that delivers on your promises. This is especially true if you want to attract 'Super Affiliates' (the top of the top affiliates - we'll talk more about this in part 2).

2. Web Site With A High Closing Rate This is the #1 mistake I see most people making when trying to set up their affiliate program. They open it up before they know if their site even sells. Wrong! You need a web site that sells! Unless you have numbers that prove your site sells you shouldn't move into marketing your affiliate program yet because you'll simply succeed in getting top affiliates upset at you.

3. High Commissions Bottom line - the name of the game for most affiliates is how much money they can make. It's a simple notion of opportunity cost. For top affiliates there is only a limited amount of space on their sites, endorsements, emails they can send out - if another program brings them $1.50 for email and yours is only making 25 cents - guess which one they'll pick? No contest!

I suggest you give as much as you can to your affiliates to help motivate them. It's much easier to do that for a digital product than a physical product. I give 45% to my affiliates. My affiliate program is also 2-tier. However unlike network marketing, it doesn't expand past the second level. On my second level or tier, I pay 5%. For example, let's say Bob is my affiliate. Bob refers John. And John also becomes my affiliate. When John makes a sale, Bob will get paid 5%.

I place a heavier emphasis and commission on the first level because I want my affiliates going out and making sales instead of trying to recruit more and more sub- affiliates under them.

4. Tools I try to provide my affiliates all the tools and assistance they need to be successful. This is absolutely critical. Most affiliate programs only give their affiliates a couple banners. That doesn't help.

Remember people are lazy, so you've got to give them everything that they need. I created something called my "Affiliate Tool Box" for my affiliates to provide them with all the tools they needed to promote the program and do really well. We provide our affiliates with text links, sample emails, banners, articles, etc. etc. You can see my example here -

Once your site is making sales and your affiliate program is set up - it's time to announce it and really put everything into overdrive with Super Affiliates. That's what we'll cover now plus, I'll let you in the backdoor of the very successful and innovative Kennedy Inner Circle affiliate program that I head up.

Welcome back to Part II. Last month I gave you an introduction to why Affiliate programs are one of the most powerful online marketing weapons in your arsenal. In this month's article I want to share with you some of the advanced affiliate strategies and secrets I've been using.

The first step to any kind of successful affiliate program is to make sure your site actually sells. This is critically important! Once you have a proven sales process on your site and you've double and triple-checked your affiliate software is working correctly - you can start promoting your program.

Announcing Your Affiliate Program

You should start with your existing customer base. Simply send out an email announcing your program and providing the link where they can sign up. I had a feeling my affiliate program would take off because I had customers emailing me asking if I had an affiliate program they could join. (That's definitely a good sign.)

Next, you can announce your affiliate program to the different directories of affiliate programs on the Web. I announced my new affiliate program to about 20-30 affiliate program directories.

Below is a list of Affiliate Program directories you should submit your information to:
Also, if you don't want to announce your program to all these sites (plus others) there is a service called Affiliate Announce ( that will do it all for you.

The top place you definitely need to announce your new program to is run by Allan Gardyne in Australia. Your announcement's listing needs to stress the benefits to affiliates for signing up. Good benefit-driven copy is important.

What you want to create with your affiliate program is a set of raving fans or 'evangelists'. You'll be surprised at how much affiliates talk about their best programs or what they're promoting now.

When my program first got underway I was lucky enough to get some people that are endorsing it as their best of the best affiliate programs. And not only that, but I started getting endorsements from people that owned emails lists that numbered in the thousands. So everything just seems to snowball when you get past the initial start up.

But there is one way to make your program and profits grow even quicker...

Super Affiliates

The most difficult and elusive affiliate to recruit into your program is called a 'Super Affiliate'. And these are the top 1% of 1% of all affiliates who can instantly shoot your profits through the roof. These super affiliates are people who control the search engines or Ezine owners with thousands upon thousands of subscribers, or a webmaster who gets mega traffic to their site, or marketers who own a huge customer list.

One good way to recruit these people is to do a search under your search terms in the main search engines and then contact the web site owners who come up in the top 10.

Another great ways is simply networking. At a recent seminar in Boulder I was fortunate enough to meet several heavy-hitters who I signed up for my affiliate program. Trust me, it's much easier when you've got numbers behind your site to prove they can make lots of money.

You want to stay on these guys and keep following up with more and more success stories and stats from your website and other affiliate partners.

Okay now I want to show you 2 new discoveries I've been using with our affiliate programs...

New Affiliate Discovery #1: Viral Ebooks

Viral ebooks are designed so that people will (hopefully) keep passing them along over and over again. And in the process build your list and sell your products if done correctly. I believe in the future you're going to see less and less overtly commercial messages on many of the top- visited websites. Instead you're going to see a lot of 'branded' content being distributed.

For example, if you sell a dog training video you could create an ebook giving some great 'what to' info but not the exact 'how to' training that dog owners would want to pass along. This ebook then directs interested people to buy the full video series at your website.

This is pretty good - but let me show how to combine affiliate marketing and viral ebooks and make this even more powerful. You let affiliates give away this new ebook with their links 'branded' and 'embedded' inside. So if anyone clicks to buy the product they get the commission. Now they have an even greater incentive to provide the ebook to their visitors. But let's go one-step further. You should also give the affiliate the opportunity to have a link built into the ebook that directs people to their site. Now that's double the incentive. We've been giving our affiliates the opportunity to brand and customize several of our ebooks using a proprietary "on-the-fly" PDF creator at This technology is not available for sale but it might be in the future. For now, there is a bulkier and less graceful way of doing it at

New Affiliate Discovery #2: Dead-End Links

More and more people are getting more hip to the fact that many products have affiliate commissions. So if a website owner or a newsletter editor makes a product recommendation - people are reluctant to click on a link that looks like an obvious affiliate link or they will simply cut off the affiliate id# portion to go to the root domain. (i.e.

That's why last year I created special domains for some of my key affiliate partners who were promoting a rights package I offered. I went to and registered a brand new domain that let me manage unlimited sub-directories (yes, even I could figure this out because it's a control panel). For instance, I registered as a domain with the sole purpose of letting top affiliates use it. Then I went ahead and set-up a bunch of different sub-directory names like - and, etc instead of the much longer, uglier and easily recognized affiliate link of -

And the other really slick thing is the "dead end page" we set up if someone types in directly. It tells them they have to type in the full URL. This way affiliates feel safe that nobody is 'hijacking' their affiliate links. (Side note: I picked this up from T.J. Rohleder)

Now since this worked so well - I'm using a variation of technique to run Dan's affiliate program for the Gold membership..

We set up each of our partners with their own domain name like or You'll notice each of sub-domains is a word that actually makes sense and not an affiliate id#. We are using the site as the main site with the dead-end page if someone tries to bypass the sub-domain.

Plus, something else that really works well is having an endorsement and picture from the endorser right at the top of each person's page. This takes some customization work - but it's worth it.

The results from Dan's program so far have been extremely encouraging. The pages have a 12.8% sell through rate once someone hits the page. Dan's affiliate program is also interesting because we pay affiliates on a recurring basis after the special 3-month trial is over. However, affiliates don't like to wait for commissions so we engineered an immediate upsell to occur after a new member signs up for their 3-month trial. This way an affiliate can make immediate commission on products offered plus recurring monthly commission on the membership. And top affiliates have been paid $1,500 - $6,000/month in commissions.

Frankly, my affiliate program is the single biggest traffic and profit generation source I use in my business. If you follow the information from last month and this month - you can be on your way to building your own powerful affiliate network.

. . .

Copyright © 2006 Yanik Silver

Just 32-years old, Yanik Silver is recognized as the leading expert on creating automatic, moneymaking web sites...and he still doesn't know how to put up his own website. He is the author, co-author or publisher of several best- selling online marketing books and tools, which can be found at

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