Getting sales when you're first starting your ecommerce business is tough.
You need to make a profit so that you can reinvest it in generating traffic in order to grow. The catch, however, is that you need traffic so that you can earn revenue and turn a profit in the first place. If you're trying to use Facebook ads or other forms of paid traffic, you might not always get enough sales to make up for that investment.
As you've researched and explored different solutions to this dilemma, you've probably seen the term affiliate marketing thrown around quite a bit. At this stage in your business you might be asking yourself, 'What is affiliate marketing?' This article on affiliate marketing for beginners will explain all the ins and outs of this important component to driving sales, and it will give you all the necessary information with regard to how to start affiliate marketing.
What is Affiliate Marketing?
Before we can adequately explain how to start ecommerce affiliate marketing, let's first examine the concept in more detail. Affiliate marketing involves partnering up with a more established ecommerce entrepreneur in your niche and asking them to promote your products to his or her audience. In return, you'd give the affiliate a percentage of revenue from each sale he or she generates. Affiliate marketing can be a great channel for first time ecommerce entrepreneurs because it's one of the only marketing channels where you can get a 100% return on investment, every time.
Many of us have gotten burned at some point through paid traffic. We invest money in Facebook ads and drive people back to our sites, but we don't always get the sales we need to foot the bill. With affiliate marketing, on the other hand, you can rest assured that all your revenue can be pure profit because there's no required up front investment since affiliates are paid through commissions.
Now that we've covered what affiliate marketing is, you're probably wondering just how to start affiliate marketing as part of your advertising strategy.
How to Start Affiliate Marketing in 4 Steps
Here’s a step-by-step guide to build and launch your own ecommerce affiliate program.
1. Get an Affiliate Tracking System
There are two ways to implement an affiliate marketing strategy: either join an affiliate network or use an affiliate program app.
- Affiliate networks act as marketplaces, giving you immediate access to a large directory of established affiliates. While most affiliate networks have in-built tracking systems, they charge significant setup fees and take a percentage of your sales, which can cut into your margins.
- Affiliate program apps give you complete control over your brand, commission rates, and data. It requires you to do your own affiliate recruitment, but it’s often more cost-effective for early-stage entrepreneurs because you avoid the network's high fees.
2. Find an Affiliate in Your Niche
Using an affiliate network is the fastest and easiest way to find partners. You need to pick a solid network, like CJ.com or Awin. They already have huge databases of affiliate marketers who are ready to roll. Once you're in, get surgical with your search. Instead of browsing randomly, type in things like "eco-friendly fashion blogger" or "best kitchen gadget reviewer." Find the people who are already promoting stuff similar to yours because their audience is your audience.
But while networks are great, finding people one-on-one often nets you more passionate, higher-quality partners. Do some serious Googling and scrolling. Search "top [Your Product Category] bloggers" or "influencers that review [Your Product]." Dig deep on platforms like YouTube, Instagram, and TikTok for people who regularly make content related to your niche.
Tip: Your best customers are often the best affiliates. Send out an email to your newsletter or a message after someone buys from you saying, "Love the product? Turn that love into cash! Join our affiliate program."
Finally, create a "Partner With Us" or “Affiliates” page on your website. Make it look professional, clearly list the benefits of your affiliate program (like high commission rates or free products), and have a simple sign-up form.
3. Contact an Affiliate in Your Niche
On the topic of looking for affiliates that cater to your niche, another way to bring on affiliates is by emailing other entrepreneurs in that niche as well. If you're not using an affiliate program, finding other stores on your own that target an audience similar to yours and reaching out to them could be a great way to start a really profitable relationship.
For example, let's say you just started a store that sells shoes. You might decide to reach out to the owner of a slightly more established store like ShoeBuy.com to see if they'd like to be an affiliate. You can also find complimentary websites. If you sell swimwear, for instance, you might partner with a sunscreen or sunglasses company.
Here's a sample email script you can send to the contact email on a more established store's website:
“Hi there, [insert store name] representatives!
I'm a big fan of your store, as I love the [XYZ products] you have listed. [Talk about what you specifically like about them.] I run a store called, [insert name of your store], where I sell [talk about your niche]. Based on our similar target audiences and products, I think there's potential for a mutually beneficial affiliate partnership. I'd offer generous commissions, of course, and we can discuss other details at your earliest convenience. If you'd like to explore this further, I'm happy to send over a few product samples. Then, you can decide if you're interested, and we can take it from there.”
Let me know!
Thanks so much for your time,
Your name”
This email nails a few key things:
- It doesn't ask for huge commitment up front. No one wants to sign up to be an affiliate partner for a site they've just heard of.
- It offers to send the potential affiliate a few product samples. If you're not using an affiliate network, you'd need to put in a bit more work to build trust with your affiliate so that they know you're legit. Sending sample products is a good way to do that.
- It mentions that you'd offer generous commissions. The better commissions you offer, the better the affiliates you'll be able to get.
4. Determine Your Ecommerce Affiliate Program Commission Percentage
One thing you should do first before starting your affiliate marketing plan is set your default commission rates. While these can still be customizable from one affiliate partnership to another, establishing your rates will help you budget in addition to influencing who and how you will approach the potential affiliates.
It's important to offer generous commission rates, especially if you're just starting out. For example, proven top fashion sites offer commissions of up to 10%, and some early-stage stores would benefit from offering even more. When it comes to affiliate marketing for beginners, providing great monetary incentives is a key way to build trust and scale up your advertising efforts by scoring great affiliates.
In fact, successful entrepreneurs treat their relationships with affiliates like gold. The more generous you are to your affiliates, the more they will want to sign up and sell your products. Thus, this means you'll reach a much wider audience.
Yet, if you are still not sold on the payoffs of offering high commissions, remember that your affiliates are not just bringing you sales, they're bringing you customers. You'll have access to people who you can re-market to time and time again.
In other words, you might have to pay higher commissions to get good affiliates up front. This strategy is an important aspect of cultivating the best affiliate program because you'll make up for that cost through the lifetime value of each customer. While we recommend offering high commission rates, you still need to make a profit on your products so make sure to do your math and arrange your budget accordingly.
It’s also useful to consider whether your products have varying markups as you come up with your default commission rates. This is because you might want to incentivize your affiliates to generate more sales on products that are already earning you higher profits. If you want to create a set rate instead, you'll want to find a percentage that takes your varying markup rates into consideration. Instead of creating a single set commission rate, some affiliate marketers opt for a tier system where different commission rates are assigned to different product categories.
Get Started with Ecommerce Affiliate Marketing Today
Affiliate marketing can be a great way to build stronger relationships with customers and other businesses that you admire within your product niche. From these people, you can gain valuable insights into customer experiences surrounding your products and learn new strategies for growing your business. This is just a basic template for how to start affiliate marketing. Now, it's time to try it out for yourself. We're sure that once you get the hang of it, you'll come to realize that the sky's the limit when it comes to making the most out of this lucrative marketing channel.
Get Started with Ecommerce Affiliate Marketing FAQ
What Is Ecommerce Affiliate Marketing?
Affiliate marketing is a performance-based strategy where you partner with others (affiliates) to promote your products. You pay a commission only when a sale is successfully generated by the affiliate.
How Do I Start an Affiliate Program for My Ecommerce Store?
Start by setting up an affiliate tracking system (like an app or network), then actively recruit partners in your niche, and finally, determine a competitive commission percentage.
What Is a Typical Commission Rate for Affiliate Marketers?
Commission rates vary by industry and product, but for ecommerce, they typically range between 5% and 20% of the sale. Generous rates are key to attracting high-quality affiliates.