Affiliate programs: opportunities for the small and the big business

Affiliate programs are becoming one of the most appreciated promotion channels by many companies. Since it is in their nature to be remunerated based almost solely on performance, during the times of economic distress firms find this solution as a good one to avoid incurring in sunk costs and paying instead only the results. With affiliate programs in fact, most firms do not pay for clicks on an ad but rather for a lead, a sale or another pre established user behavior.

One of the advantages of affiliate programs is that they can be used profitably by both small and big enterprises. Whether you own a small business you manage from home or you are part of the marketing department of a large firm, the alternatives for participating un such plans make it possible for many realities from very different industries to promote their products on the web.

There are two essential forms of using these advertising strategy: you can either do everything on your own by buying or creating your own platform for affiliates from which you will monitor all activities, or you can trust the management of the logistics to one of the already existing affiliate networks representing the interests of hundreds of thousands of companies and webmasters.

The first modality implies a much more hands on approach from you or the people in your company in charge of the various campaigns and publishers. You will have to set up the interface (or buy one), upload your offers and ads, determine which publishers are suitable as well as manage relations and payments with them. The clearest advantages of taking this path is that you have more control over who publishes your ads, how and at what price.

On the investment front, this alternative means incurring in relatively higher costs in the beginning since it is necessary to either create a software or purchase it. Some big companies like Destinia or Fidelity House own a special area dedicated to affiliates where promotions, links and images are uploaded and where invoices and payments are handled. Other, typically smaller companies, may decide to purchase a ready to use software that is usually paid monthly or annually before pondering whether or not designing their own in-house platform.

The second way of using affiliation to promote your products requires less effort from you and your company. You still get to create the promotions, graphics and strategies for advertising but your entrust the management of your affiliate campaigns to an affiliate network like Zanox or Tradedoubler. These companies act as a bridge between firms that want to advertise online and webmasters and website owners who want to monetize their virtual spaces by hosting ads.

These networks manage both the subscription of affiliates to your campaigns and the monitoring of performance as well as invoicing and payment. Your company has less control over who publishes your ads but can reach a much larger number of webmasters. The force of this networks lies, in fact, in their ability to gather a large number of websites from very different topics in order to offer companies a wide array of choice in terms of targeting and visibility.

Investments for the first and second solution are different and largely depend on the economic capacity of a company when starting with affiliate programs. In the long run the in house solution is more profitable if the company is able to manage the whole system: there is more control over the publishers, the percentages earned by each webmaster and there is no cost for the intermediary. If the time and resources are not enough to manage the platform within the company, the costs of trying to do it inside the company can be very high. In the case of lacking personnel or skills for undertaking such endeavor, the best solution is to go through a specialized affiliate network.