In today’s competitive world, many businesses are looking for new avenues to increase sales and revenue. And with customer acquisition costs (CAC) increasing 60% in the last 5 years, it’s imperative for businesses to embrace cost-effective revenue generation streams.
This is where affiliate marketing comes into play.
Affiliate marketing, an appropriate solution for all e-commerce businesses, involves an affiliate (marketer) signing up to an affiliate program offered by a merchant (the company) to promote and sell their products in return for a commission.
Started in 1994, affiliate marketing has become a popular choice among brands. Industry stats show that 81% of companies rely on affiliate marketing because it involves very little investment. If you’re still on the fence pondering over whether to try it, here are 5 reasons why affiliate marketing is good for your business.
1. It’s Cost-Effective
As mentioned earlier, one of the key benefits of affiliate marketing is that it’s cost-effective. Sure, you’ll incur costs in setting up and running your affiliate program but it’s minimal compared to paid advertising and hiring a marketing team.
According to industry experts, the monthly cost of running an in-house affiliate program rarely exceeds $500. In contrast, professional PPC management can go as high as $5,000 a month and this does not include your monthly ads spend.
2. It’s Easy to Track
Just like any other advertising method, affiliate marketing can be tracked.
In fact, tracking has been dubbed the lifeline of affiliate marketing. Affiliate tracking provides valuable insights that help marketers determine whether their efforts are paying off.
But the simplicity of tracking is what makes affiliate marketing fun. Specialized affiliate tracking software is used to track affiliate campaigns and most of these programs collect information even where no action is completed. Information collected includes the following:
All this info builds up data relevant to strengthening your campaign. If you’re new to affiliate marketing, the PropellerAds tracker will be more than enough for your needs. It offers full functionality, including a viewability pixel that measures the real impact of your campaigns.
3. Affiliate Marketing Is Performance-Based
With traditional pay-per-click advertising, you’re charged per click meaning you’ll pay whether the leads convert or not.
But with affiliate marketing, affiliates are only paid a commission when a sale is made. Because of this, affiliates are more motivated to drive the conversions you’re looking for. Some affiliate programs are also set up to pay for leads and other actions but the majority pay per sale.
The performance-based model that affiliate marketing employs not only enhances cost-savings but also ensures no resources are wasted on ineffective advertising methods.
4. It Increases SEO
When promoting a product, the publisher links back to the brand’s website to drive traffic to the offer. These inbound links play a greater role in helping consumers find you and are critical to search engine rankings. In other words, they boost SEO.
That said, if your publishers have high-ranking websites and produce quality content regularly while linking to your website, you can expect a bump in your organic traffic.
5. It Helps Broaden Your Audience
Each affiliate the advertiser works with already has an established audience.
By leveraging affiliate marketing, the advertiser can tap into this otherwise undiscovered audience and turn them into their own.
For example, if you have 20 affiliates in your program and each has 10,000 readers/followers, you could potentially get your products in front of hundreds of thousands of people every day. This not only expands your reach but also creates brand awareness.
Now that you know what affiliate marketing can do for your business, why not give it a try?