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How To Choose the Affiliate
Program Software That is Right For You
With online advertising forecast to grow by 30% this year, the affiliate
marketing segment is expected to grow in line with this estimate.
Merchants are expected to either add affiliate marketing to their existing
online sales channels or upgrade their platforms to expand their existing
programmes even further.
A key part of running a successful affiliate program
is being able to manage your affiliates efficiently and cost-effectively.
Thankfully, there are software products to help you do this. The trouble
is, with dozens of different affiliate software suppliers offering a wide
range of features, functionality and pricing, how do you choose the right
one?
There are six main types of affiliate software, each
with its strengths and weaknesses. Once you choose and implement a
particular solution, it can be complicated and expensive to switch. Be
sure to do your research beforehand and choose a program that meets your
needs both now and for the future.
1. Stand-alone Software
You pay a one-time fee to own the software. You
install it on your web server where it integrates with your other systems,
such as your e-commerce and CRM components.
Pros: Typically has extensive features and
functionality. Ongoing fees are minimal and do not change with the size of
your affiliate program. Affiliate links show your domain address because
the software is hosted on your server. As more affiliates create more
inbound links to your site, it can have a positive effect on your search
engine rankings.
Cons: Requires installation, which you will need to
pay for if you cannot do it yourself. Having the software on your server
may require a bigger web hosting package, resulting in higher hosting
charges.
2. Hosted (ASP) Software
The software is provided as a service by a third
party. They host it on their server and you pay to access it.
Pros: Upgrades are typically included and are rolled
out as soon as they are available. Requires no technical skill as
installation and hosting is handled by the vendor. Upfront costs are
lower.
Cons: Ongoing monthly fees are usually based on
volume of transactions. As your affiliate program grows, your costs may
grow as well. Some vendors may not allow links that go first to your
domain – reducing the added benefit of inbound affiliate links and search
engine positioning.
3. Affiliate Networks
Again, the software is hosted and provided by a
third party. You also gain access to an established community of people
who are actively looking for affiliate opportunities.
Pros: No technical skill or maintenance required.
Instant access to a large pool of potential affiliates, which can help
build your program quickly. Usually the network handles the administration
of the entire program, including affiliate payouts and reporting. You do
nothing but upload your affiliate offers to the network site.
Cons: The network takes a relatively high
transaction fee on each affiliate sale. Minimal options for customizing
the program to your specific needs.
4. MLM Software
Multi-level marketing (MLM) is often considered the
“black sheep” of the affiliate marketing concept. However, there is
significant overlap between MLM and affiliate marketing. MLM talks about a
“downline” whereas affiliate marketers refer to their sub-affiliates. Same
concept, different name. Since there are software packages to manage an
MLM business, you should not overlook this possibility for running your
affiliate program.
Pros: Excellent for managing an affiliate program
with multiple tiers.
Cons: There’s a certain stigma attached to MLM.
Potential affiliates may be scared away if they discover you are using MLM
software.
5. Shopping Carts
Shopping cart software allows customers on an e-
commerce site to select items they wish to purchase and store them in
their virtual shopping basket, before paying for their purchase in one
electronic transaction. Many e-commerce shopping carts include affiliate
management features as either a standard or add-on module.
Pros: E-commerce and affiliate management functions
are integrated into one program, making maintenance easier and less
expensive. The affiliate module is not typically based on volume so fees
remain the same as your program grows.
Cons: Affiliate management is not the vendor’s
primary focus so the software may have less functionality than other
software options.
6. Web Site Builder Systems
These all-in-one packages usually bundle web site
building tools, web hosting, e-commerce and affiliate functionality.
Pros: Can help you launch a complete e-commerce site
from scratch very quickly. Little technical expertise required.
Cons: Paying for many different services as one lump
sum means you may be overpaying if you only want one or two pieces. Again,
affiliate management is not the vendor’s primary focus so functionality
may be limited.
Whether it is the effectiveness of cookie tracking,
the booming popularity off RSS and datafeeds, or companies using the
latest tools in fraud and parasite detection, it’s critical when choosing
an affiliate provider to work with a company that is going to adjust to
the market. The affiliate software solution that works best for you will
depend on your affiliate strategy and requirements. Think about your
needs, do your research, and choose wisely. |