Business & Finance Electronic Commerce

Affiliate Marketing for Start-Up Companies - A Brief Insight

Before delving into the contemplation whether affiliate marketing is any good for start-ups, it is important to understand what is affiliate marketing exactly and how does it work.
Let's visualize a scenario wherein you have just set up a website for your start-up venture and are looking for an effective way to attract customers.
With limited budget and little industry experience, you may be hesitant to invest hefty amount of money on those fancy marketing campaigns.
So, you (the business owner) decide to affiliate with other website owners (known as affiliates) and devise a mutually beneficial agreement.
Under this arrangement, the affiliates receive a specific commission or fee whenever a visitor or customer comes to you through their efforts.
The affiliate promotes your products/services through banners and ads, and receives a specific percentage of each sale generated.
The whole scenario consists of four key players: merchant (in this case, you), affiliate network (which gives affiliates the flexibility to choose from various payment plans), publisher (affiliates) and the visitor.
Commission payment models in Affiliate marketing Cost Per Click: Payment is done on the basis of the number of clicks affiliate receives on the merchants' banners on its website.
Cost Per Lead: In this payment structure, the customer referred by affiliates complete a form on merchant's website.
Cost Per Sale: A customer referred by the affiliate actually purchases products and services from the merchant.
Is it any good for start-ups? YES, and that too in a big way, obviously because it is performance based, and you are paying for measurable, quantifiable results.
There is no hit-or-miss situation, and you know that your spending is going to bring in profit and revenue in loads.
And if the affiliate happens to be a giant industry player, there is nothing better than that.
The best thing about affiliate marketing is that you don't have to be an expert in SEO, just get affiliates who are adept in particular traffic generation technique, and you've covered it all.
This will also help you downsize your sales personnel and subsequent overhead costs and risks.
As such there is no drawback of affiliate marketing, but you will need to ensure that the affiliates you choose have good ranking and can drive quality traffic to your website.
Look for affiliate programs that render something which is relevant to your site.
Keep a close watch on tracking and reporting tools that allow you to view real-time statistics pertaining to commissions, sales and conversions.
Last but not the least, if you believe in yourself and in the product you are selling and promoting, there is literally nothing that can stop you from reaching the peak of success ladder.

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