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Getting good affiliates for your business is much like winning good new friends.
MediaGroup London’s Bart Burggraaf considers that to do a great job for your company, they need to know that you value them and act in their interest, they need to find you interesting (i.e. like your company and its products) and they need to know that you take feedback well, and act on it. For that reason alone, conferences like the iGB organises are a great way to get in front of potential affiliates and convince them of your merits, something that is much harder to do without the personal connection.
Let’s back up a bit though. Why should you care about getting affiliates to sell your product? The answer to that question mostly comes down to Risk and Scaling. Paying affiliates just when they bring new business and then only (or a portion) on the revenue they bring means you have no upfront capital at risk; you are literally buying revenue with (almost) no Risk. Secondly, because you potentially have an army of salesmen working on your behalf, you have a chance to Scale your business much faster than you would be able to with your own capital and limited manpower.
Given the above two main reasons why one might want to use affiliates over doing things yourself, it figures this tactic is mostly useful for business with limited resources; a small broker might fit in this category. Of course there could be additional reasons such as not possessing the needed knowledge internally, not being as effective yourself, not having fixed overhead with affiliates, or by using affiliates get a chance for greater Distribution; but these are secondary in my opinion as you can always hire (temporary) talent and be your own internal affiliate army, if you have the resources.
So, if you are a small to mid-sized broker and you think the above reasons for setting up an affiliate program make sense for you, it’s important to work on a program that gets you many “friends” fast. Part of the key to success is to offer great payment terms including the size of the payout, transparency and reporting and the frequency of payment. The affiliates will also need support, marketing material and a great product to sell. And if you don’t have the time or resources to do all of this in house, there are many companies specializing in this market that can support your program.
Before you set out to do that, it’s important to know what kind of affiliates are your target audience. As with most things in this world, there is an 80/20 principle at play that is worth observing; a small subset of affiliates will bring the vast majority of business your way and if you can stomach the requirements these kind of affiliates have, this might be your best bet to grow fast with the least amount of effort. There is, however, a large ‘Long Tail’ of affiliates that you can bring on board that will provide smaller amounts of business each, but as a whole can be very lucrative and easier to bring on board with better terms from the brokers’ point of view. Which way you go is determined by many factors, but suffice it to say that more established players will have an easier time getting the larger affiliates on board.
One further distinction is the way in which these affiliates bring you business; one type of affiliate will buy advertising to promote your business, the other will have distribution already (i.e. they are a publisher) and take no immediate financial risk in this manner. It might be a more fruitful avenue to work with such publishers and get them to become your affiliates, especially at the start of your affiliate journey. However, the affiliates that have the financial resources to buy advertising might be able to scale faster and bring you more business.
Conferences like the one taking place tomorrow are an excellent place to meet vendors and prospective affiliates – whichever type of them you are looking for – so go forth and make some new “friends”!
This article was written as a guest editorial by Bart Burggraaf, Managing Director & Partner at MediaGroup London, which is a specialist marketing agency focused on financial services companies.