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3 Necessary Tools for the High Rolling Affiliate Marketer
What does it take to become a successful Affiliate Marketer?
What are the ingredients of an affiliate marketing success
story? Is there a shortcut to Affiliate Marketing glory? All
these questions play around in the minds of affiliate...
Adwords, Affiliate Marketing And Cashing In On The Xmas Spend
It's going on right now.
The biggest Xmas spend online ever.
It stands to reason that each year more and more people get
online. More of the people online begin using their credit cards
to shop online and more of these shoppers realise...
Affiliate Marketing and The TV Show 'Lost'
I just finished watching the latest episode of 'Lost' on TV and noticed it was a little different from most episodes. Instead of the
usual mysterious, cliffhanger type show, this one was more of a
character-driven background story. Then I...
Affiliate Marketing Assets - Things You Need In This Business
There are millions of ways to make money, particularly in the internet. But with the new internet marketing technologies developing daily, sometimes the choices may seem confusing. Many people find themselves what type of business is best and right...
Affiliate Program Commissions - The Higher the Better
A good way to tell if the affiliate program you belong to is serious about their affiliate program commissions is the percentage they are paying you. If someone is offering you 10% commission, and they are keeping the rest, then you need to ask...
Affiliate Programs - What Are They
Affiliate Programs - What Are They by Lois R. Thompson (c) In recent years Affiliate Program marketing has taken the Internet by storm. Many surveys have demonstrated that Affiliate Marketing can be the most cost effective method to promote your...
Common Sense Ideas For a More Profitable Affiliate Program
Before you create your affiliate program, or in the early stages, you need to make it is as easy as possible for your affiliates to make a sale. You should have your site tweaked to the point that the only work your affiliates have to do is...
How To Choose An Affiliate Program
What is the most important of these two factors in choosing an affiliate program? 1. What the program can offer you. OR 2. How you think the program will sell to others. Ignore for a minute whatever it is the program sells, and ignore what...
How to make Big Money with VOD Adult Affiliate Programms
If you have a homepage of your own, or thinking to enter into the online adult business this event may be virtually interesting to you. If you´re not just after some cents, but interested in making REAL MONEY Video on Demand is the right answer!...
How to make money from affiliate programs without spending a single dime on advertising Part II of II
You start off by writing an interesting, informative article and then you post it at one web site complete with your full contact details in the resource box. Now the rules for free articles are that anybody can pick up your article and re-post it...
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An Explanation of Affiliate Marketing Compensation Plans
While the vast majority of affiliate programs have compensation plans as straightforward as a flat commission on all referred sales, the occasional affiliate marketing program will seem like a twisting maze of conditions and requirements than leaves you scratching your head and wondering what terms like forced matrix, stairstep breakaway, and override commission really mean. Sometimes it's tempting to ignore the details of these complex compensation plans and trust that promoting your affiliate link as much as you can will make you rich. The truth is, though, that while it isn't impossible to earn a decent living without a complete understanding of how the money is coming in, a thorough understanding of the mechanics of your compensation plan will reveal where to direct your effort to realize the most profit for the time you invest in your online business.
Unilevel
A unilevel plan is one of the easiest compensation plans to understand. When you introduce a new affiliate to the program, they become your direct referral, or sub-affiliate. There is no limit to the number of sub-affiliates you can have. In addition to the commission you earn on your personal sales, some programs will pay you a (usually smaller) commission on the sales of your direct referrals, often called a second-level or second-tier commission. If your direct referrals also introduce new affiliates to the program and you earn a commission on their sales, a third-tier commission is being paid. Theoretically, there is no limit to the number of levels a compensation program could pay you on, but in practice most online affiliate programs only pay a commission on one or two tiers. This is largely to separate affiliate programs from the often-maligned multi-level marketing.
Forced Matrix
One of the biggest problems with unilevel plans is that anyone who becomes successful recruiting direct referrals will quickly have too many to communicate with regularly. Since regular interaction with your upline is a key to success for many affiliates, some program managers choose to implement a forced matrix program. In a forced matrix plan there is a set number of direct referrals you may have. If you continue to recruit new affiliates after you have reached that limit, they will "spillover" to become sub-affiliates of your direct referrals. Since you are restricted in how many direct referrals you may have, forced matrix programs generally pay on more tiers than unilevel plans.
One of the goals of a forced matrix is to create an environment in which every new affiliate has a mentor immediately above them with the time to offer training and guidance. This is partially successful, but can be disorienting for new affiliates who are recruited
in to the program by someone who has earned their trust only to be handed over to another program member who may or may not maintain that same rapport. A forced matrix plan also produces freeloaders who wait for spillover affiliates and fail to do any recruiting of their own.
Payline/Powerline
Whether it's called a powerline, payline, or something entirely different, this plan is often made to sound far more complicated than it really is. Imagine a forced matrix where you are limited to only one direct referral. If you recruit a second sub-affiliate, she spills over beneath the first. A diagram of your downline will resemble a straight line. If there is a limit on how many levels down you earn a commission, you quickly run out of motivation to recruit new affiliates. The solution is usually to pay you a commission on all sales made by anyone in your downline for an infinite number of levels.
Breakaway
If you are participating in a payline program that pays a 10% commission, some quick calculations will quickly reveal that once the 10th affiliate is referred to the program and makes a sale, the company is paying out the entire price of the product or service in affiliate commissions. Since that business model will quickly destroy any company, payline programs that pay on infinite levels must have some sort of breakaway, sometimes called stairstep breakaway. When one of your sub-affiliates meets a certain criteria (usually personally recruiting some number of new affiliates) they break away from your line and start their own payline. When this happens, you no longer receive a commission on the activity of their direct referrals.
Override Commission
If that were the end of the story, there wouldn't be much incentive to mentor your sub-affiliates and teach them how to recruit people to the program. Therefore, breakaway plans almost always have an override commission. Whenever one of your referrals breaks away, you still receive a small commission on their activity. Usually breaking away also signifies a graduation on the part of your sub-affiliate to a point where they will require less guidance from you.
If none of these concepts sound like a perfect match for a compensation plan you know about, it's because most affiliate program managers customize these elements to create a unique compensation plan. Examining a compensation plan will provide clues about the objectives of the program manager and what direction they plan to take the affiliate program in the future.
About the Author
Clay Mabbitt writes articles about online income opportunities. He is the founder of a community of Internet entrepreneurs sharing knowledge and experience at http://www.affiliatescreen.com
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