Commission Percentage Options for Affiliate Program Participants
When someone begins an affiliate program, they often wonder how much commission they should offer their affiliates. This is something that only the product owner can decide. Before making the decision, take into account the type of product being sold and the program itself.
Those who are offering a sales program based on where the affiliates earn a percentage, there are some different things to consider. Costs involved in making the product and time involved are all things that should be taken into consideration when it comes time to determine the commission for the product, as that can help to decide just how much can actually be afforded for use as commission.
Digital products, like interview recordings, e-books, and other things are great because they have very low costs for production. In this case, a higher rate of commission is much easier to obtain for those involved in selling the product, making this type of affiliate program that much more attractive in the end.
There are things out there that are tangible, that can actually be held that make things work a bit differently. These things are a bit more difficult to determine commission on as the production expenses and shipping costs all have to be taken into consideration, along with other things. Once these things have been determined, they can discover how much is actually earned with the sale of their product and it is much easier to determine what can afford to be paid out as far as commissions go.
For those out there who are working to increase the amount of names on their mailing list, a pay per lead program might do very well. A pay per lead program is an excellent program, as affiliates are paid for each subscriber that the product owner receives through their efforts.
Those who have already had their sites established for some time probably already have a method of tracking their sales and where they come from, so they know how effective their list is. They can find out how much is earned through the list based on the number of names on it, and the number of dollars earned per subscriber to their list. This type of determination makes it easier to decide what can be earned per lead by the affiliate, and depending on what the total comes out to a product owner can afford to pay all or part of that amount, either turning over all profits to the owner or leaving them for the product owner.
Those product owners out there who do not have a mailing list already in place may have a difficult time determining what they can offer their affiliates based on what they get from their list. There is always the option of setting up a teleseminar that costs money to register, based on any of a number of products. Base the subject of the teleseminar on the product or site involved. This type of thing can allow people to offer affiliates a 100 percent commission for each registrant that is offered. There won't be any profits lost but the mailing list is going to be that much more useful in the end.
If you are a product owner trying to decide what affiliates should be paid, it might help to take a look at your competition and see what they are going to pay their affiliates. Don't forget that you don't have to match their commission rate, just make it competitive. Consider what the commission that is paid in consideration with the amount of the product. Find out the commission percentage that is going to convert into sales for you, and what will drive your affiliates to work and create sales for you.
If there ever comes a time where you are not sure as to what to offer, consider the fact that you can start out lower, but entice your affiliates with the promise of higher commissions later. Your affiliates will be excited about this promise, and that is just another way of helping to keep them motivated.