How to launch an effective e-commerce affiliate program

As of 2023, the affiliate marketing industry is worth $17 billion. Whether you’re just starting your e-commerce business or looking for new ways to grow your customer base, affiliate marketing is one of the most effective options. Affiliate programs are the top customer acquisition channel for 40% of US e-commerce merchants.

What is e-commerce affiliate marketing? 

E-commerce affiliate programs allow online stores to build relationships with various partners, from influencers and content creators to entrepreneurs. Partners obtain unique affiliate links and promote the products to their audiences. The most common promotion channels are blogs, review websites, and social media.

The affiliate partner earns a commission when consumers click an affiliate link and purchase a product.

16% of US online orders originate from affiliate marketing. It may seem like a small number, but it makes more sense when you compare this to Google Ads, which account for 18% of online orders in America! Among all the marketing options, other efforts will likely require a more significant chunk of your marketing budget than running an affiliate program for your e-commerce business.

The most popular industries for e-commerce affiliate marketing are fashion (23%), sports and outdoors (18%), and beauty/health (14%). Other good-ranking industries include travel, home and garden, computers, and electronics. 

Nonetheless, don’t get discouraged if your store doesn’t fall into these categories! Launching a solid affiliate program and following best practices can still result in high ROI and increased sales.

Infographic explaining how e-commerce affiliate programs work

Benefits of launching an e-commerce affiliate program

Here are five critical benefits of launching an affiliate program for your e-commerce business:

  1. Reach new customers: partnering with established affiliates allows you to tap into new audiences you may not be able to reach otherwise. Additionally, affiliate partners usually have niche specializations so that you can market to a highly-targeted customer base with e-commerce affiliate programs. 

  2. Build trust and brand credibility: Leverage the relationship your partners have built with their audience. For example, millennials are 247% more likely to be influenced by blogs or social networking sites. Therefore, an e-commerce affiliate program is an ideal way to reach millennial buyers.

  3. Low risk and cost-effective: Only pay for results with e-commerce affiliate programs. Through an e-commerce affiliate program, you can arrange to pay a commission to partners after purchase – a cost-effective way to acquire new customers.

  4. Get valuable insights and data: affiliate software automatically tracks conversions and rewards, providing real-time data on your e-commerce affiliate program's performance.

  5. Increased sales: Lastly, affiliate marketing will generate sales, help your e-commerce business grow, and increase your revenue sustainably.

Infographic explaining 5 benefits of launching an e-commerce affiliate program

Tips & best practices for launching a successful e-commerce affiliate program

Even though each e-commerce affiliate program should be unique and built to fit your brand and target audience, we’d like to share some best practices and tips to follow:

  1. Partner Experience: Brands need a competitive reward model and a positive partner experience to drive partner retention, loyalty, advocacy, and channel growth in a competitive partnership landscape. Make sure that your e-commerce affiliate programs are partner-first! 

  2. Micro-influencers: Influencers with hyper-targeted followings can cut through the noise in a content-saturated world. They are also better positioned to connect authentically with their audience. This helps to establish loyalty and longer-term customer relationships for your e-commerce business.

  3. Niche audiences: When recruiting e-commerce affiliates, look for partners with a clear niche that aligns with your product. Focus on a particular industry or product type to achieve higher credibility and engagement and reach highly targeted audiences.

  4. Competitive program terms: Research your competitors and ensure your e-commerce affiliate program offers the same or better terms. This may be a deciding factor for a partner to promote your product.

  5. Partner engagement: Ensure your partners know you’re there to support them. Keep them updated about new products and promotions, and provide training (if your product requires it) and marketing materials. It’s always a good idea to ask your partners for product or affiliate program feedback.

  6. Observe and adapt: Neither your affiliate program terms nor your marketing strategy should be set in stone. Research and try different things to see what yields the best results. Try to reach out to different types of partners, offer different rewards, and test various marketing materials and products.

How to start & manage an e-commerce affiliate program

Now that you’ve seen the benefits and best practices, it’s time to launch your affiliate program. Here’s how to launch an e-commerce affiliate program: 

  1. Competitor analysis
    Analyze your competitors’ program terms and marketing strategies. Pinpoint what they’re doing well and where they might fall short. You should note commission rates, the cookie lifetime, and other details. This will help you establish how your program should look like.

  2. Decide on your program structure

    Will commission rates be flat (e.g., $20 for any order) or percentage-based (e.g., 30% from every sale)? A competitive commission structure motivates e-commerce affiliates to drive the most sales possible for your business. You should define how long your tracking cookie will last after the initial click to determine eligibility for a commission. Remember, you’ll need to afford all these rewards and yield sustainable revenue!

  3. Prepare terms and conditions
    Prepare a legally binding document defining the terms and conditions your e-commerce affiliates must adhere to during your partnership. The goal is to protect your brand by setting clear expectations for your e-commerce affiliates, including reward eligibility conditions, brand presentation requirements, copyright, and other essential details.

  4. Use e-commerce affiliate software to set up, and track performance
    Set up program terms with affiliate software. This will help you integrate your online store, automatically track conversions, attribute rewards, and pay your partners. Affiliate software will also allow you to track program performance. Find your top-performing affiliates and pinpoint what they’re doing to be successful.

    Partnero is a comprehensive partnership management tool that allows you to boost your store revenue by launching a bespoke affiliate program focusing on partner experience. 

    With Partnero, you can fully customize program settings: adjust commission rates, type & period, cookie lifetime, and referral links, track program performance, manage partner accounts, set individual commission rates, and provide your partners with a white-labeled partner portal. Read more.

  5. Find the right e-commerce affiliate partners
    Focus on finding the right e-commerce affiliate partners to promote your product. Reach out to content creators with an audience that could be interested in your product or are in a similar niche. Reputable e-commerce partners with high engagement are a compelling way to reach new customers. Consider an application system and ask relevant questions to filter potential e-commerce partners.

Infographic explaining 5 steps to launch an e-commerce affiliate program

Are you ready to launch? Sign up with Partnero today to create an e-commerce affiliate program tailored for your e-commerce business!

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