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Why Two-Tier Affiliate Programs are Best


When you join an affiliate program or start an affiliate program of your own, you have to decide whether it will be a single tier or two-tier affiliate program.

With a single tier program you earn a commission on any sales you make and that is it. If you are running your own affiliate program, you pay your affiliates a commission for any sales they refer and that is all.

However, with a two-tier program, affiliates are allowed to recruit sub-affiliates and are paid a small percentage of the sales these sub-affiliates generate. For example, the affiliates may earn a 30% commission for selling product X himself; and when one of the sub-affiliates makes a sale, the affiliate may get a 10% commission as well. This is very profitable for the affiliate as he can recruit an army of sub-affiliates, all earning commissions for him without any effort on his part except for the initial recruiting process.

If you are starting an affiliate program of your own should it be two-tier or single tier? Some might shy away from the seeming expense of a two-tier program. But is it really that expensive? Many affiliate program managers make the wrong decision on this.

Let's look at an example. You have an affiliate program up and running and an average affiliate joins your program. Mr.Average has a web site that receives average traffic. He also has an ezine with thousands of subscribers published monthly. Mr. Average posts your affiliate links to his web site and promotes your product to his ezine list.

Initially, he generates good sales. However, a point comes when he saturates his market with your product and his sales begin to drop. He begins to lose interest in your program and your sales remain small. What happens if you set up a two-tier program? Rather than trying to keep your commission pay outs small, you motivate your existing affiliates to recruit other people to your program. This will exponentially increase your affiliate sales. Would it not be worth paying the referring affiliate a percentage of their sub-affiliates' sales? Now when Mr.Average joins your affiliate program this is what would happen. When he has saturated his market with your product, he would now promote your affiliate program to his customers and ezine subscribers. Many of Mr.Average's customers and subscribers decide to join the affiliate program. This in turn will motivate Mr.Average to continue promoting your products and recruiting affiliates.

Now what is the situation?

1) Your income increases because of increased sales.

2) You have a much larger customer base to which you can sell 'backend' products.

3) An increase in your income because of the life time loyalty of the customers referred by your affiliate.

4) An army of sub-affiliates who will sell your products, and in turn promote your affiliate program to their customers and subscribers.

The little extra in affiliate sales commission pay outs will be more than compensated for by the exponential sales increase. This is why the two-tier affiliate program is a guaranteed winner and should be the automatic choice for potential affiliates and affiliate program managers.

© John Lynch

For details of the SiteSell affiliate program with lifetime customer commissions, residual commissions through renewals of Site Build It, and 2-tiers of income go to: http://affiliates.sitesell.com/finian.html


Todays News by officejax surplus outletMORE AFFILIATE REVENUE RESOURCES updated Tue. February / 07 / 2012

Fox on Top - Multichannel News

Fox on Top
Multichannel News
SNL Kagan calculates FNC's affiliate revenue at $985.3 million in 2012, based on 82 cents per sub each month. “The network is getting strong monthly subscriber fee increases, up from 58 cents in 2009,” according to Baine, who projects average license ...

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Super Bowl's Record Viewership Kicks Off Watershed Year For Sports - Deadline.com

Super Bowl's Record Viewership Kicks Off Watershed Year For Sports
Deadline.com
Visions of ESPN's $4.69-per-customer carriage fee are spurring the move — Versus took in $122.6 million in ad revenue last year, according to SNL Kagan, while ESPN took in $1.48 billion in ad sales and $5.27 billion in affiliate revenue.

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Viacom's CEO Discusses Q1 2012 Results - Earnings Call Transcript - Seeking Alpha

Viacom's CEO Discusses Q1 2012 Results - Earnings Call Transcript
Seeking Alpha
We expect our affiliate revenue to grow on an annualized basis in the high-single to low-double digit for the foreseeable future. As we unlock value for our content across platform, we're unlocking growth potential across global markets as well, ...

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Stylitics Is an Analytics Dashboard for Your Closet [INVITES] - Mashable

Stylitics Is an Analytics Dashboard for Your Closet [INVITES]
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The startup has no intention of pursuing an ad or affiliate revenue model, at least for now. Instead, Stylitics plans to generate revenue by working with brands, retailers and media partners to “give them a window into what their customers are wearing ...

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Viacom Earnings Hurt By Nickelodeon Issues - Broadcasting & Cable

Viacom Earnings Hurt By Nickelodeon Issues
Broadcasting & Cable
"We expect our affiliate revenue to grow on an annualized basis in the high single to low double-digit for the foreseeable future." James Barge, CFO, said that domestic affiliate revenues increased 16%, while international revenues increased 18%.

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5 Proven Ways to Generate Revenue From Facebook - Mashable

5 Proven Ways to Generate Revenue From Facebook
Mashable
And how does Facebook fit with the marketing channels that already work for you, like email, text messages and affiliate revenue? There are a number of strategies companies use to do Facebook business effectively. Let's look at five of them.


ProPay Credit Card Processing Reviewed and Rated “A” by CardPaymentOptions.com - PR.com (press release)

ProPay Credit Card Processing Reviewed and Rated “A” by CardPaymentOptions.com
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“Their offerings include smartphone attachments for mobile processing, ecommerce technology, affiliate revenue split programs, and ACH processing capabilities.” ProPay is a payment company that provides services for merchants seeking processing ...


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