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The secret growth hack that built an affiliate marketing program that grew our startup from $2 million to $14 million in just 2 years.
I had an epiphany about life that led me to uncover the most effective growth hack I’ve ever thought of.
It’s the secret growth hack that grew our business from $2 million to $14 million in just 2 years.
Once I figured it out, the marketing community went wild.
I started to get invited to speak on podcasts…
and radio shows…
and to lecture at business schools…
and to speak at conferences around the world.
This tactic that I discovered (and what I’m about to reveal to you here in this post), has also been featured in a number of the most cutting edge marketing books and top university courses.
And it helped skyrocket traffic to this site, Growth Marketing Pro!
It’s a funny story, how I figured it all out, and I’ll tell it to you here.
But the secret to building an affiliate program lies in identifying a basic human need that we all have, and how you can leverage it to build strong relationships with people, prospects and partners.
But before I reveal the secret, let’s review — What exactly IS an affiliate marketing program anyway?
Looking for help with your marketing? Work with us at Growth Marketing Pro Agency.
First off, what’s an affiliate marketing program?
Very few people actually know what an affiliate marketing program is, how they work or how to build one.
I used to be one of those people.
But now I know that this marketing channel is a hidden gem.
If you learn how to do it correctly it can drive 100% of your business — all by itself.
An affiliate marketing program is when you build partnerships with bloggers and influencers in your space that have an online audience and agree to pay them per lead that they send to your site.
Usually, you both sign an agreement in which the affiliate is paid at a flat rate per conversion, or at a percentage commission of closed deals. But sometimes, it’s a bit more casual… a friendly handshake agreement to pay $X for each converted lead. It’s really up to you and what makes the most sense for your business.
If you can offer an appealing and motivating payout rate per lead, the relationship is mutually beneficial for both you and the affiliate.
The affiliates benefit because they can now monetize traffic to their site. You benefit because you now have an influencer vouching for your product and sending qualified traffic to your site with intent to buy.
Every company under the sun is trying to figure out how to build an affiliate program. Because once your affiliate marketing program is up and running, it is SO incredibly profitable. You don’t even need to have cash upfront to get started.
I get calls non-stop from companies BEGGING me to come and build their affiliate program for them. But usually I just send them to this blog post. All you have to do is follow the instructions I lay out for you here…
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Why does affiliate marketing work? Because it’s “friendly” traffic.
Online bloggers and influencers who have a loyal following, have readers who return to their site time and time again. These readers have established trust with the blog and content they find there. Growth Marketing Pro has a super engaged audience of hundreds of thousands of marketers and entrepreneurs. They read, they trust us, they comment on our posts, they email us and engage!
So when a blogger writes about your company and can recommend it to their readers in a truly genuine way, that blogger is sending a “warm lead” to your site. This is someone who’s already been primed, pre-qualified by learning a bit about your site and is interested enough to click through to learn more.
To give you an idea of how strong affiliate leads are, get this: on average, companies that implement affiliate programs get their highest conversion rates from affiliates. Mark and I have found that affiliate partnerships yield 4.4X the conversion rate of an average website visitor.
So this stuff is powerful.
How to start an affiliate marketing program
About four years ago, while doing growth marketing for a real estate technology company in San Francisco, I was tasked with building an affiliate program from the ground up.
I had NO idea what an affiliate program was or how to build one.
So the first thing I did was research and create a list of all the financial technology and investing bloggers in our space and reach out to them via email to invite them to join our affiliate program…
I sent out 50 emails and got 12 responses. All of which did not think the partnership would be a fit or were not interested at this time.
That effort produced zero affiliate partnerships.
It wasn’t until I was working on a side project of mine, when I unlocked the secret to building affiliate relationships.
How I discovered the secret to building affiliate relationships…
I used to have a little blog called “Top Five CityGuide.”
It was a blog where I aggregated survey responses from hundreds of New Yorkers and San Franciscans about their absolute favorite restaurants in various categories. Each week I’d post a new blog post based off the data I collected “Top Five Brunch Spots in NYC”, “Top Five Burgers in NYC”, “Top Five Coffee Spots in NYC”. Here’s a screenshot of one of the blog posts below…
Each time I wrote a new blog post, I also posted about it on Facebook and Twitter, tagging every restaurant or company that was mentioned in the blog post.
To my surprise, these renowned restaurants and food brands were extremely flattered by the mention and over 50% of them “liked”, “re-posted” and “shared” my tweets…
It was at this point that I came to a realization about life that helped to drive my growth marketing career forward.
People love being recognized.
Recognition is a basic human need. See Maslow’s hierarchy of needs below.
Every human person is flattered and excited when they get recognized.
That includes big brands and companies. Since after all, when you pull back the curtain, brands and companies are just made up of a bunch of human people.
And people don’t get recognized nearly as often as you’d think. In fact, it rarely happens.
Using recognition to drive growth
So the second time I tried building an affiliate program at that real estate company, I took a whole different approach.
I put together a bunch of blog content around the
- “Top 60 Real Estate Investing Blogs”
- “Top 76 Alternative Investing Blogs”
- “Top 75 Real Estate Blogs”
- “Top 14 Personal Finance Blogs”
- and many many more.
As many categories as I could possibly think of that related to FinTech or the real estate industry. All together we ended up mentioning over 373 different blogs, podcasts, books and influencers within these “Top” lists that we posted to the blog of this company’s website. I wanted to give recognition to as many people as possible.
Next, I reached out to every single person that was mentioned in one of our blog posts, taking a different approach than the first time I reached out via email- I didn’t mention our affiliate program at all.
Here’s the response I got this time around…
By first giving recognition to the blogger for their fantastic content, I was able to “warm up” the relationship, and therefore Joe and the rest of the bloggers I spoke to were far more open to learning about our affiliate program.
Not to mention all the shares and backlinks we gained when these 373 influencers shared our post with their followers.
Out of the 373 influencers we emailed, 66 of them ended up signing up for our affiliate program. That’s an 18% conversion rate!
By utilizing this strategy alone, I was able to grow our affiliate program 9X year over year ?
Not only did affiliate traffic grow exponentially- but the quality of the leads proved to be among the strongest relative to other channels like SEM, Native and Paid Social.
Meaning that signups that came from our affiliate program, became customers at a higher rate and spent more dollars on our platform than customers from other channels.
The program grew and grew to the point where we were getting so many leads from the affiliate program, that we actually had to pause spend on other channels like Facebook and Adwords. We simply didn’t have enough marketing budget to pay out all our affiliates AND run Facebook and Google ads.
When I left, that affiliate program was the largest and highest ROI channel running at this company.
How to start tracking your affiliate marketing program
Tracking your affiliate marketing program is extremely important if you want the operation to run smoothly. Things are going to get hairy very quickly if you’re not tracking how many leads your affiliates are sending you.
Each affiliate will require their own unique link. That way, you can identify how many leads came to your site via that unique link and tie it back to that affiliate so you can pay them appropriately.
Tracking affiliates the right way
Like I said, if you’re not tracking carefully, things will get hairy quickly.
Why? Because all your affiliates are going to want to know how they’re performing. If they are spending time promoting your product to their audience, they will want to know how many clicks, conversions and dollars they’ve earned.
The great news is that there’s a simple and 100% free way for you to get started with tracking your affiliate program. As with anything in marketing (and business), you should run the most minimum viable test before going all in on something more expensive and “heavy weight.” So if you’re just starting out, you should add “UTM” parameters to your affiliate links.
To do this, you’ll use Google’s URL builder to add UTM parameters to your links.
UTM’d links are ones that have a bunch of mumbo jumbo at the end — mumbo jumbo that allows you to track users. For example: https://www.growthmarketingpro.com?utm_source=affiliate&utm_medium=affiliate-name). UTM’s will allow you to see visitors from that “source” and “medium” in Google Analytics. So you can identify how much traffic and how many leads are coming from where.
Pay your affiliates monthly and send them a monthly screenshot of your Google Analytics dashboard to show proof of their traffic and conversions.
The problem with this solution? Affiliates won’t have access to their own dashboard where they can track conversions and earnings. You’ll have to manually be sending out reports and making payouts, which can get very tedious as your affiliate program grows.
The cheap & quick software solution
Omnistar was the first platform I used to get the affiliate program off the ground and it worked wonders, and was quick and easy to set up at a cool ~$40/month.
The problem with this solution: You will be able to track in Google Analytics how many conversions you are getting from Omnistar everyday, but it can be a bit difficult to tie exactly which email conversion came from which affiliate. Also, you will need to manually pay your affiliates every month.
If that is something that’s super important to you, you might want to consider a more sophisticated solution…
A more advanced solution
Ambassador, is the affiliate marketing software to use if your business is a bit more sophisticated and you have budget for a more advanced tool.
The Ambassador platform makes it easy for affiliates to sign up, access their unique tracking link and monitor their clicks, conversions and commission. You can even pay your affiliates through the platform.
How did I find out about Ambassador? Well, first I used them to build out our referral program at that real estate company which scaled 10X within 45 days of implementing Ambassador. Enough said. I implemented it on the affiliate marketing side as soon as I saw those results.
So you have affiliate partners — now what?
Once someone agrees to be an affiliate partner you’re on your way!
To get them in the door, you’ll say something like: “When you sign up as an affiliate, you’ll get a unique link that you can use any time you refer to our company. When someone clicks on your link and signs up or makes a purchase, we’ll pay you $X in commission.”
Once an affiliate signs up, the first thing they need their unique link. Every affiliate marketing partner should have their own unique tracking link. That way, whenever they write about your product, they’ll be able to link to your site and get credit for every click or every sale.
If you use a tracking platform like Ambassador, your affiliates will immediately get sent to a dashboard where they can access their unique tracking link.
How do you get affiliates to write about your product?
It’s one thing to convince someone to sign up as an affiliate.
You: “Hey, do you want to make money for writing about my product on your blog?”
Them: “Uh, yeah.”
It’s another thing to convince them to actually sit down, and take the time to create content that will drive affiliate conversions.Your product is likely not the only product that they’ve signed up to promote.
You: “Hey, so I noticed you signed up to be an affiliate, but I’m not seeing any traffic from your site yet…”
Them: “Oh yeah, I’ve been meaning to, but I just haven’t had the time to get around to writing new content”
So, how do you actually encourage your new affiliates to take the time to write about your product? How can you get your new partners to prioritize producing your content and promoting your content ahead of their other partnerships?
Provide affiliates with the tools they need to be successful
- Pre-written blog posts
- Best practices around creative (what works for your company when you write about your product?)
- Examples of high converting headlines
- Important data points around your company
- Press pieces that mention your company
- Examples of blog posts from successful affiliates
- Set up a kick-off call where you can brainstorm ideas together
Incentivize your affiliate marketing partners
Say it’s a month or two later and you’re still not seeing them send traffic to your site, how do you motivate them to get started?
I’ll tell you how — you pay them!
Check it out…
You: “Hey, so you know how I told you earlier that I’d pay you $40 per conversion? Well, if you send over your first few conversions before the end of the month, you can lock in a special rate $60 per conversion for good.”
Them: “Oh shit, sweet deal. I’m going to get on writing your content ASAP!”
Reward affiliate partners that send strong leads
Before going ahead and offering more money per conversion, you’ll have to make sure that the numbers back out for your company. Make sure you’re thinking about your return on investment (ROI) when offering a special deal. You’ll want to make sure that you’re still getting value from these conversions.
That might mean that you start newer affiliates at a lower pricing tier and promote them to higher priced tiers once you determine that they send you high quality traffic.
It’s totally okay to have pay different affiliates different base commissions per conversion.
Sucky Affiliate: “Hey, can you bump up my base commission rate?”
You: “Uh, no. None of the leads you are sending me are actually converting. They’re low quality and I can hardly afford to pay you what I’m paying you. In fact, I’m considering terminating our partnership if I don’t see an improvement in lead quality before the end of the month.
Awesome Affiliate: “Hey, can you bump up my base commission rate?”
You: “Yes — the leads you are sending me are awesome and spending a lot of money our product. I can bump up your commission rate by $X.”
Usually anywhere from $5-$20 extra is very much appreciated!
Stay top of mind with your affiliate marketing partners
Once you’ve gotten your affiliate partners to “activate” or make their first few referrals that convert on your site, you’ll want to continue to stay top of mind so that they’re constantly motivated to continue pumping out content with your company’s name on it.
There are a few ways you can do this.
- Email drip campaign: Enter your affiliate’s emails into an automated email drip campaign that sends them an email every week with data and nuggets of information that they can use in their content.
- Press: Send your affiliates any articles or press mentions about your company. They can share this with their audience or integrate the news into their own content.
- Build relationships– Follow your affiliates on Twitter. Connect on Linkedin. Join Facebook groups and engage in their communities. Integrate yourself into their world and bring value when you can by sharing articles they might be interested in and liking their content.
- Host events: Invite your affiliate partners to company events or offer to host a meetup at your office. If you can provide value to your affiliate marketing partners, they will want to return the favor.
People love to be recognized.
- Identify influencers you want to partner with.
- Create a “top list” blog post that recognizes them for high quality content.
- Email them to let them know you think they’re awesome and they’ve been featured.
- Pitch your affiliate marketing program.
- Manage your affiliate program through a tool like Ambassador or one of the solutions I mentioned earlier.
- Set up your affiliates for success and motivate them to get started.
- Stay top of mind with your affiliate partners
If you carefully track your affiliate marketing traffic, you’ll soon discover that it can be an incredibly valuable source of leads.
Affiliate traffic is too valuable to ignore!
The great thing about an affiliate program is that it’s relatively inexpensive. Rather than paying per click or per impression like you do on Google Adwords or Facebook, you only pay for actual signups on your site. No money wasted!
If you’re looking for high quality traffic growth, an affiliate program is a great place to start.