Whatever you are a newbie or an advanced affiliate, this post will give statistical data-supported information on how to choose an affiliate program? Together with Email Marketing, Affiliate Marketing is one of the largest sources of online business income, accounting for over 16% of all ecommerce orders in the USA and Canada. It can be one of the most lucrative home based businesses today.

Affiliate marketing is a performance-based marketing model, in which affiliates earn a commission by promoting other people’s or company’s products. While merchants (also known as advertisers or dealers) determine what actions they want to reward and how much they are willing to pay. We have compiled some data from the AffStat (2016) event, to help you on how to choose an affiliate program that best suits your expectations and needs.

# 1 – How to choose an affiliate program?

STEP 1 – Find your niche online

A niche market may be understood as a set of a larger group of potential buyers that have specific needs (e.g. “watches”). On the other hand, you can decide to sell only “luxury watches”, which corresponds to a subniche (i.e. a subgroup) within the main category of “watches” (the niche). The key factors to select a niche are: [symple_ul style=”minus-gold-list”] [symple_li]Identify a niche that interests you[/symple_li] [symple_li]Identify a niche that you feel very passionate[/symple_li] [symple_li]Pick up a niche that you are very knowledgeable[/symple_li] [symple_li]Pick up a niche in which there is low competition whenever possible[/symple_li] [/symple_ul]

These criteria will help you bring out your best and give your visitors who are possible buyers a demonstration of your expertise in the niche you have chosen. As you promote yourself as the authority within your niche, you will gain the trust of your audience over time. They will feel encouraged to buy the products or services that you endorse.

As we can see from the figure below, the top five categories promoted by affiliates in the modern marketplace include at the first position (1) computer/electronics, followed by (2) clothing/apparel, then (3) online services, then (4) accessories, and finally, (5) beauty.

Image credit: Top product categories promoted by affiliates

Once you selected a niche to work, you should start doing some Keyword Research. Kеуwоrdѕ are thе fоundаtіоn оf ѕеаrсh еngіnе орtіmіzаtіоn (SEO) аnd рау-реr-сlісk (PPC) саmраіgnѕ (e.g. Gооglе Adѕ), affiliate mаrkеtіng, аnd mаnу other areas. They оftеn dеtеrmіnе раgе rаnkіngѕ оn ѕеаrсh еngіnе rеѕultѕ pages (SERPs). A keyword can bе еіthеr a ѕhоrt or a long tаіl kеуwоrd.

Whеn уоu аnаlуzе search volumes of various keyword lеngthѕ, chances аrе short tаіl kеуwоrdѕ wіll hаvе a higher аmоunt of mоnthlу searches іn comparison to long tаіl ѕеаrсh tеrmѕ. Although seemingly lеѕѕ popular, lоng-tail kеуwоrdѕ often саn bring mоrе tаrgеtеd trаffіс to уоur ѕіtе thаt wіll convert bеttеr соmраrеd tо ѕhоrtеr kеуwоrdѕ.

Note that the “Keyword Research” step correlates to the “How to choose an affiliate program?” step in the sense that you need to know the exact keywords typed in search engines by the audience of a given affiliate product. You should use long-tail keywords to find out your affiliate subniche, then to bring you organic traffic, which can be done with some free online tools:

[symple_ul style=”minus-gold-list”] [symple_li]Simple Long-Tail Keyword Generator[/symple_li] [symple_li]KeywordTool.io[/symple_li] [symple_li]InstaKeywords[/symple_li] [symple_li]Google Auto Complete tool[/symple_li] [/symple_ul]

Image credit: Google Auto Complete

On the other side, the use of paid keyword services can bring a competitive advantage for your online business. As an example, WordTracker is widely recognized as the market leader for over a decade! It is primarily designed for SEO. We have reviewed the WrdTracker funcionalities and prices at our pos named WordTracker Review.

If you need to conduct a deep Keyword Research to answer a question like “How to choose an affiliate program?”, so WordTracker will be the best partner you can get. WordTracker proprietary technology gets 10,000 keywords per search and related keywords, so your web pages can be optimized more effectively to outrank the competition. Besides, it allows you to take competitors’ keywords, in-depth PPC and SEO insights, data from Google, Youtube, Amazon…

Image credit: WordTracker

STEP 2 – Create your own advertising channels

Once the “How to choose an affiliate program?” step is over, create your own website (e.g. a blog, a landing page, or an ecommerce) with top-level domain names and reliable hosting service. Fill out your website with relevant content about the niche you have chosen. Each site page should contain SEO-optimized content and keyword-rich links to your top navigation page if you wish to be easily found on search engines.

Besides, you also should include target keywords in the breadcrumb navigation, in the anchor text, and in your URLs, with the aim of increasing free organic traffic to your website. Building your own website is the traditional method to start on, but, of course, there are other ways to promote an affiliate offer bypassing this stage.

Actually, many affiliate marketers focus primarily on building a popular social media channel, like a Facebook fanpage, and then link it back to their website (if existing). For instance, a voggler combines embedded video with supporting text containing his affiliate link and other metadata. Vlog category is popular on the video-sharing platform YouTube.

STEP 3 – How to find affiliate programs?

Now, it is time to search for merchants as well as for products or services that are related to your interest. You can stick with one merchant or go with as many as you need for your business. The most widely used method on how to choose an affiliate program seems to be getting information directly on the merchant’s website. Secondly, using the information found by organic searches on Google, Yahoo, etc. And thirdly, entering to affiliate networks.

Image credit: Where to find out new affiliate programs?

In general, affiliate networks tend to be niche-oriented and can utilize more than one compensation model. Each affiliate program within a network informs, among other things, how it can and can’t be advertised. Retail industry affiliate programs are in high demand on the market considering that ShareASale is a retail niche network. The top 5 affiliate networks preferred by affiliates are

[symple_ul style=”minus-gold-list”] [symple_li]ShareASale[/symple_li] [symple_li]CJ Affiliate by Conversant[/symple_li] [symple_li]Rakuten LinkShare[/symple_li] [symple_li]Clickbank[/symple_li] [symple_li]Avangate[/symple_li] [/symple_ul]

Image credit: Top affiliate networks used by affiliates

STEP 4 – How to choose an affiliate program?

Once you have signed up for a given affiliate network, be ready to choose one or more affiliate programs that suit you best. How to choose an affiliate program? When selecting an affiliate program to promote, 81.16% of affiliates say: “I am always or usually the decision maker“. While 12.18% say: “I am sometimes the decision maker“. This statistical data possibly reflect if they are working alone or with someone else.

Image credit: 81.6% of affiliates decide by themselves the affiliate program they will promote

Now, let’s turn our attention to more interesting data in percentage related to the top factors driving people when selecting a program. And, then let’s see in detail very important metrics to be considered when selecting an affiliate program anywhere else. We notice that, for most affiliates (84.7%), the decision-making process is based on criteria related to relevance and reputation.

Image credit: Top factors on how to choose product for affiliate marketing

The top five criteria on how to choose an affiliate program are (1) product or service relevance (18.15%), (2) affiliate program reputation (15.97%), (3) affiliate network or tracking platform (11.58%), (4) merchant reputation (10.14%), and (5) brand awareness (10.11%). That is interesting to note that the commission (5.41 %) ended up in the nineth position when they were choosing between 14 factors.

(a) Program Accessibility

As soon you find what appears to be a great affiliate program, you have to apply to become an affiliate. It may be so simple as pressing a button! However, sometimes you will be required to explain to the advertiser why he should accept you as an affiliate. Advertisers have access to publisher’s performance and they prefer ones with a minimum sales history. If you have gotten approved, then they will supply you with a personalized affiliate link or code.

Image credit: How do affiliates deal with access denied messages?

On the other side, when an affiliate program denies a given application, 47.43% of affiliates say that they contact the affiliate manager to find out why they were denied and try to see if the situation can be remedied. Whereas a small number of affiliates (11.23%) remedy the situation and even negotiate a commission increase, others 41.34% consider that there are plenty of other programs to promote, and thus they just move on.

(b) Payment Model

Compensation is based on performance measures, normally in the form of pay per clicks (PPC), per sales (PPS), per leads (PPL), per action (PPA), and per impressions (CPM). Paying per sale is often seen as the payment model most favorable to advertisers and least favorable to publishers when compared to PPC and PPL. In PPS, advertisers have fewer concerns about whether conversions are legitimate, whether traffic is incentivized or of low quality.

In PPS agreement, the publisher must not only be concerned with the quality and quantity of his audience, but also the quality of the advertiser’s creative units and destination site. If possible, many publishers avoid sales-based agreements, preferring to stick to the CPM model. However, some publishers, facing weak ad sales, have little choice but to accept sales-based agreements to utilize remnant space.

(c) Recurring Payment

Lots of trustful programs are ready to pay you a recurring income. Recurring commissions are, in general, offered by companies that have a high-quality product or a very useful service required to be paid monthly by their clients, like Email Marketing providers. In this case, the affiliate will keep earning money on complete autopilot for a fixed time (e.g. a year or lifetime) or as long as their referred users stay with the company.

(d) Multi-Tier Pay System

A flat fee is generally preferable for merchants, but of course, a multi-tier commission system sounds much more attractive for affiliates. From the advertiser’s perspective, it is worth considering adding the element of second-tier to their main program, since this pay structure can bring still more affiliates. On the other side, this strategy could drive affiliates to refer themselves under different accounts only to earn higher commissions.

(e) Program Ticket

You will be probably looking for the most profitable products and which merchants pay the best. If the product is cheap, so do not accept less than 20% of the total price as your commission. Recall that you will also have to cover the costs of running affiliate marketing ad campaigns, building your own advertising channels, etc.

You can find many programs with great payment structures and high percentages of pay in just about any field. And, some of them offer commission increases, cash bonuses, and prizes. High-ticket products are the first choice of experienced marketers when they are thinking on how to choose an affiliate program.

Many ecommerce sites offer commissions on product sales between 8 and 15%, so make sure you take margin into account while also being competitive, based on your industry. (Source: BigCommerce)

(f) Payout Period

When will you be paid? Find out how often you will be paid and be sure that the payment schedule meets with your own expectations. Affiliate networks usually set a period of time before releasing the money for their affiliates. This is a common practice to ensure that refund requests can be covered. In most cases, orders are subject to a 30-day payout period, but it can be so long as 90 days.

(g) Minimum Payout

It stands for the payment threshold that an affiliate must accumulate in commissions to initiate a payment from the affiliate program. It is a comparatively less important factor on how to choose an affiliate program.

He will not get paid until he reach a minimum payout amount, which depends on the affiliate network chosen, and it usually ranges from $15 – $100. Amazon, for example, has a $10 minimum threshold for affiliates choosing to get paid by direct deposit or gift card, and a $100 threshold for payments by check.

(h) Payment Methods

If you have joined an affiliate program through a network that processes payments of products on behalf of merchants, it is not uncommon for merchants to offer several methods of payment. While this is something great for clients, it is not so good for affiliates.

As expected, the majority of affiliates (48.69%) prefer the direct deposit method (if existing) when thinking on how to choose an affiliate program. Paypal appears as the second preferred commission payment method (19.16%) while bitcoin line up in the seventh position (2.69%).

Image credit: Payment method preferred by affiliates

(i) Conversion Rate

As you might suppose, the recommendation is to pick up products that have the biggest conversion rates. This is certainly one the most important factors on how to choose an affiliate program.

A low conversion rate could mean either that the advertiser’ landing page design is not straightforward to complete the desired action, or his offer is off base. It may mean that the offer is not valuable enough to your audience or is too expensive. This percentage ratio is thus one of the most important criteria to consider.

(j) Refund Rate

The percentage of orders refunded is calculated over a certain period of time, often 30 days. Some industry niches have average refund rates much higher than others. With regard to infoproducts, affiliates should look for products with refund rates lower than 3%. As you move into the realms of high-ticket items, it becomes even more important to work with low refund rates.

In a given affiliate network, merchants with high refund rates can be under a risk of suspension. Understand that for every refund request, other clients were equally unhappy but did not ask for their money back. In digital marketing, customers acting in bad faith sometimes ask for refunds even when they have enjoyed the product. If it becomes recurrent, they can be denounced and be blocked through affiliate networks.

To decrease refund rates, advertisers must produce high-quality info products, and be as clear as possible about the content of what they are selling. While publishers, who intend to be a successful marketer, they should learn how to attract the right audience, persuade them to take the leap to buy without any type of misleading advertisement, and last, not least, turn away those who represent a mismatch.

Making the customer happy and dealing with their concerns is of utmost importance to getting those referrals. That becomes an issue of customer service not necessarily marketing (Dee Reinhardt).

(l) Attribution model

An attribution model involves a set of rules to determine how credit for sales and conversions is assigned to touchpoints in each conversion. There are six common attribution models for commission tracking: First Interaction (“First-Click“), Last Interaction (“Last-Click” or “Last-Touch“), Last Non-Direct Click, Linear, Time-Decay, and Position-Based (“U-Shaped Attribution“). 55.69% of them have no clue why they should be paying more attention to this.

In the First Interaction approach, if a lead first finds your ad on Instagram, for example, so Instagram gets all of the credit for any sale that happens after that interaction. Only the first touchpoint matters. It may be a good fit for you if you have a short buying cycle. In other words, if your business has a tendency to convert leads into customers immediately.

In the Linear attribution model, in turn, the credit for a conversion is equally distributed between all the interactions the lead had with your brand. In Linear, if a lead finds you on YouTube, looks at your Facebook, and goes to your website to makes $150 purchase, each of these 3 touchpoints gets 33% of the credit (a $50 conversion).

In Time Decay, the first interaction gets less credit, while the last interaction will get the most. In Position-Based, 40% of the credit goes to the first touchpoint (e.g. YouTube) and to the touchpoint where the conversion happened (e.g. your website). The remaining 20% spread out between any other interactions that happened in the middle (e.g. Facebook).

Image credit: Last Interaction Attribution Model

Last Interaction is the most accurate tracking method for conversions. It is the default model in most digital platforms (e.g. Google Analytics). The downside is that it ignores any other touchpoints prior to that last-click. Only the last touchpoint matters. It is helpful if your sales funnel is wide at the top, but narrow at the bottom. With Last Non-Direct Click model, the credit is assigned to the touchpoint immediately before the final interaction (i.e. to the channel from where leads come before reaching your site).

(m) Cookie duration

A lot of merchants use cookies for tracking your referrals. As the majority of clients don’t purchase on the first visit, cookies allow for potential referrals to be tagged with the affiliate ID so that if they do purchase later, you will get the credit for the sale. When thinking on how to choose an affiliate program, recall that cookies lasting over a 30-day period are better.

The duration for the cookies will vary from merchant to merchant. Some last as short as a single session, while others can last for years. If the visitor flushes their cookies on a regular basis, has cookie blocking software, or the program from the merchant isn’t operating correctly, there really is not anything you can do.

(n) Program Support

Be sure that top-level support is included as well as static pages listing the number of click-throughs received, sales, and your actual earnings in that network. If your affiliate manager cannot answer your questions in a quick and timely manner, you do not want to work with them. Whereas 84.12% of affiliates prefer that information from affiliate managers arrive via email, it typically occurs only a few times, in 48.19% of cases.

The business relationship established between affiliates and affiliate managers is, most frequently, perceived as “somewhat valuable” or “crucial” to their online business. Something that is perceived as crucial is definitely an important factor on how to choose an affiliate program. Only 18.16% of affiliate marketers say that almost never consider joining, promoting or terminating programs because of the affiliate manager.

Image credit: The business relationship between affiliates and their managers

(o) Promotional materials provided by the advertiser

Before you engage in any affiliate program, you should always check the merchant site carefully. If you have any doubt, contact the merchant before you proceed any further. Verify if the advertising materials contain high compelling, persuasive marketing elements. Always look for programs that offer a wide variety of tools to put on your website, including banners, text links, and graphics.

STEP 5 – Promote your affiliate link

At this point, you are ready to promote. You should place your affiliate link on all your advertising channels (website, fanpage, etc). Success in affiliate marketing starts on the “How To Choose An Affiliate Program” step, but the fuel is actually getting your affiliate product on as many sites as possible.

Put your efforts into driving as much internet traffic as possible to your affiliate link. There are lots of free and paid traffic sources on the internet, which you should monitor by using a tracking system. Learn more about it in our SEO and Social Media categories.