Affiliate Business Strategies
This article was published in a special edition of Website Magazine (June 2009 - distributed early next week). To ensure you receive the valuable insights published in each special monthly issue, upgrade to a professional-level membership today at WebsiteMagazine.com.
As an affiliate, you are essentially the CEO, General Manager, Supplier, Office
Manager and Custodian of your business. And as a one-person show, you are
entirely responsible for your business strategies. By adapting the right practices,
you can fuel your business growth in a manageable and profitable fashion.
Taking your affiliate marketing activities to a professional level is a transition that’s attainable by nearly every affiliate. What it requires is that you set clear goals and effectively measure them, monitor your progress toward those goals, and optimize your efforts based on what is and is not working.
Critical to any successful business is not just the amount of hours worked, but how well those hours were used. Super-affiliates don’t just work harder; they work smarter by deciding in advance exactly what they are working toward. Figuring out where to focus your energies in order to achieve your objectives can be the difference between having a time-consuming hobby or a profitable business. With clearly defined goals, you can identify your Key Performance Indicators (KPI) — tangible factors that will indicate the progression toward your overall goals.
Once you have defined success for your business, the next step is to determine the distance to that goal. Consider the product you are promoting, the profit margins entailed, and the volume you have right now. Then conduct a gap analysis by comparing where you want your business to be versus where it currently resides. From there, set clear objectives based on what you know to be realistic possibilities.
For example, if you want to increase business by 100 percent, you might set a realistic goal of increasing your traffic by 10 percent each month over the next 10 months. Increasing traffic by 10 percent each month is the KPI. Then identify the areas of your business where you could focus to reach those growth goals — a vertical, product offer or a promotion, for example. Your KPI will help track the effect of these growth strategies.
MEASURING & MONITORING PROGRESS
As the scale and scope of your business changes, so will its KPI. Initially, you’ll want to focus on short-term conversions that can generate a quick return to reinvest into your business. As you grow, however, you’ll want long-tail conversions that save energy and resources by generating revenues on an ongoing basis. Consequently, you’ll need to monitor the returns on your efforts so that you focus your energy on the best returns for you current business needs. Provided that your affiliate marketing software has the right functions and features, it can be an excellent tool for doing so.
Once you have an idea of your KPI, drill down and collect intelligence on progress toward your specific goals. There are two general sets of intelligence that are particularly useful in monitoring growth targets: acquisitions and conversions.
On the acquisition side, a creative report offers insight into what actually resonates with your target market — the banners and links that were actually clicked by users. This kind of report allows you to analyze click-through-rates (CTRs) for different banner designs, dimensions, and placements. In turn, you can see the origin of your traffic. By comparing banners that convert with those that don’t, you gain insight about what kind of banner placements to keep and drop, respectively.
Once you acquire traffic, it needs to convert. Referral reports analyze how well a referral converts, from first click straight through to purchases, and continued over its entire lifecycle. In this respect, the referral report provides intelligence on the quality of referrals coming from different creatives, such as average purchase. From there you can determine what products you can viably promote to reach your business goals.
It can be risky to abandon your day job and dive in head-first. Growing a business and getting a return takes time and strategic effort. By reflecting on your business model then identifying your KPI, you can then determine the gap between where you are and where you want to be. From there, you can set measurable business goals and monitor your progress toward those goals.
Affiliate software is an invaluable source of business intelligence. It can produce performance-based intelligence in a controlled environment, help organize it according to your goals, and then help you refine that intelligence at a reduced risk. Once you are confident that a particular campaign or promotion is optimized to meet your business goals, you can commit to making it part of your business practices.
About the Author: Nicky Senyard is CEO of ShareResults.com, a relationship-focused affiliate network and comprehensive affiliate marketing solution for both affiliates and merchants.