Starting an Affiliate Program

Once your dropship business has stabilized, this is the next course of action for your business. By ‘stabilized’, I mean that you have strong relationships with a solid customer base, you have a positive reputation for delivery of your promises and products, and your website is attracting a decent amount of traffic every month.

An affiliate program has the potential of expanding your dropship business by several times. It is basically an offer which allows people to promote your products on your behalf. When they make a sale, you pay them a percentage of the product price as commissions. These internet marketers have their individual ways of promoting your products; some may promote your products through their own website, while others may market your products through their opt-in list.

As long as your retail products are of high quality, people would be willing to go a long way in promoting such offers. With these internet marketing people hard at work promoting your products, it is only fair that you reward them well with commissions. While most websites offer only a meager percentage of the price as commission, you would do better if you increase your percentage commissions paid out. Such offers would attract more affiliates and bring in much more revenue, even though the profit you retain on each sale is less. The high-end commission offers can go up to 60%, while the lower ones can drop to 10%. 'Super affiliates', those experts at affiliate marketing who bring in tons of commissions monthly, are attracted to profitable offers as they earn more on each sale while doing the same promotion work. Hence, please be generous with your commissions as these 'super affiliates' can be attracted to your offer. 'Super affiliates' are valuable because a few of them can potentially generate a large proportion (>50%) of your sales.

Starting affiliate programs is a very smart way of doing business. You do not have to do any marketing, yet revenue is flowing in from the effort your affiliates are putting into advertising your products. It’s like getting free income for not doing any work at all. For most affiliate programs, the owners also get to keep a larger share of the pie, around 60 to 80%.

Starting an affiliate program may be troublesome, but it is actually not difficult. I highly recommend software that can keep track of all your affiliates and their referrals, allowing you to pay them their deserved commissions on a regular (monthly?) basis. Without this indispensable software, it would be quite impossible to successfully run an affiliate program, as the chores of keeping track of every single affiliate would overwhelm you. Such software would not only be saving you tremendous amounts of time, but would also ensure that your commissions are paid out consistently without fail.

Hence, software for managing affiliates would be a very wise investment, and your dropship business would do well to have numerous affiliates promoting your products.