Affiliate Commissions

Affiliate marketers participating in affiliate programs earn their keep through transactions. Commissions vary from program to program depending on the salability of the product. Some programs give as much as 45% to their affiliates while some affiliate programs give a mere 10%. So small compared to the effort an affiliate marketer puts into his task just to generate a sale.

So what do you do to increase your commission earnings? Do not join affiliate programs which commission rates are only 10%. Investigate the type of products or services that the affiliate programs are promoting to find out if the commission rate of 10% is justified. Beside, an affiliate marketer getting only a 10% commission rate needs to have an extremely large customer base to be able to earn a reasonable amount of money.

Consider this scenario: Suppose you were selling a product that costs about $ 100. To be able to earn enough money from this product you will need at least about 250 visitors to your website. If 60 customers out of the 3,000 visitors bought a product from the website that would give you a commission of $ 6000 a year.

Compare it with this scenario: You are selling a product that gives you $ 1 commission per affiliate program. You would need to sell at least 500 items per month to be able to earn a $ 6000 commission a year! A sales ratio of 2% would mean that your website would have to generate 300,000 visitors a year or 25,000 visitors a month.

Based on the two scenarios, I believe it would be more practical to sell a product of high value. As difficult as it is to attract visitors to a website, it is more difficult to make a sale. Selling a product of higher value would mean generating less traffic to the website but would still earn the affiliate marketer a reasonable amount of money.

And ask yourself this; is the product manufacturer serious with his affiliate marketing program? A manufacturer who is serious in promoting his products would not give a meager 10% commission to his marketing affiliates. You see, to be able to attract effective marketing affiliates the manufacturer would have to use generous commission as bait. So if a marketing program offers you a 10% commission, think about it overnight. You might find out that the effort you placed into selling the product can not be compensated with a 10% commission.

I know of an affiliate program that pays 45% commission to their top affiliate marketers. Second tier affiliate marketers of their program are given 10% commission. The affiliate program is giving away a generous 55% to their affiliate marketers and only keeps 45%! In my opinion, this is a smart marketing strategy. By paying high commissions to their affiliates, they are actually appealing more affiliates to their program. This means that the products they are promoting are moving at a higher volume. This means higher earnings for the manufacturer with no extra effort since the affiliates of his marketing program are doing all the work. This is like dangling a carrot in front of a donkey in order to make the donkey move! In order to make higher volume sales, a generous commission must be dangled in front of affiliate marketers!

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