The document discusses the basic elements needed to set up a successful affiliate marketing program, including affiliate management, tracking software, creatives, commissions, proven offers, and deciding between an in-house program or outsourcing to an affiliate network. It provides an overview of how affiliate marketing works and its benefits for both advertisers and affiliates. The document aims to help readers understand the fundamentals of affiliate marketing.
4. 3
Introduction
Do you know what it takes to run a successful affiliate program?
The majority of advertisers, product owners, and merchants search the internet high and
low for new ideas and methods to promote their brand, and build new customers.
Affiliate Marketing is often thought about, yet not quite understood.
You research the benefits of Affiliate Marketing, yet you’re left with unanswered
questions, and may feel anxiety placing your brand with another company.
The goal of this white paper is to help you understand Affiliate Marketing.
The ups, the downs, the pros, the cons, the information needed to make an educated
decision introducing your brand to a billion dollar industry.
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5. 4
There are four sections included in this Affiliate Marketing white paper.
First, the foundation (the building blocks) of an affiliate program, leading into traffic
sources, and ending with the pros and cons of an in-house affiliate program.
There is ten years of experience jam-packed into this white paper.
From being an affiliate network (NAMoffers) owner, to being in the trenches with 500+
affiliate programs, analyzing data, eating, sleeping, and breathing the Internet.
Enough said… scroll down, and get your butt into the first section!
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6. 5
What is Affiliate Marketing?
What is the first thing that comes to mind when you think about Affiliate Marketing?
Many start with horror stories, which is natural for a technology based industry, and those
who need more information — every industry in the world has horror stories.
Others start with success stories of advertisers tripling their customers.
You may soon have a new perspective on the strength of Affiliate Marketing.
Affiliate Marketing is evolving, and there is billions of people coming online.
The first affiliate networks started in the late 90’s, pushing uncharted waters, all while
learning how to create the technology, and infrastructure to create a new economy.
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7. Check out a couple definitions for Affiliate Marketing below:
1) “Affiliate marketing is a type of performance-based marketing in which
business rewards one or more affiliates for each visitor or customer
brought by the affiliate’s own marketing efforts”
- Wikipedia
2) “A way for a company to sell its products or services by signing up
individuals or companies (“affiliates”) who market the company’s product
for a commission”
- Entrepreneur
In layman terms, the advertiser, or merchant only pays a person or website (affiliate) who
creates a new lead, sale, or most recently app install to your business.
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8. CPA
Advertiser pays for a completed sale - flat rate: $40 / sale
CPL
Advertisers pay for a lead - email, address, phone, and/or custom questions
CPS
Advertiser pays for a completed sale - percentage of sale: 5% / sale
CPI
Advertiser pays for an app install - android & iOS
CPD
Advertiser pays for a download - desktop toolbar or browser extension
PPC
Advertiser pays for calls that meet the required call duration
6 BUSINESS MODELS AVAILABLE IN AFFILIATE MARKETING
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10. Benefits of Affiliate Marketing
How many benefits can you think of for Affiliate Marketing?
There is the obvious benefit… advertisers compensate affiliates on a performance basis,
meaning affiliates only get paid when a new customer is referred.
There is plenty of reasons to get excited for both parties!
There is the opportunity for an advertiser to get customers, and there is an opportunity
for affiliates to create a part time or full time income promoting products online.
Take a look at the mind-boggling facts on Affiliate Marketing below:
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11. FACT 1
Advertisers will spend $4.5 billion dollars
on Affiliate Marketing by early 2016.
source
FACT 2
The digital channel will spend $52.8 billion,
and television $79 billion
source
Take a moment to think about those numbers.
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12. Affiliate Marketing accounts for approximately 8.5% (4.5 / 52.8) of total advertiser spends
online, and is equivalent to 5.7% (4.5 / 79) of total television advertiser spends.
This may be a opportunity to get ahead of the competition dressed as a white paper.
It's not an overnight success; however, the Internet, and Affiliate Marketing is growing
quickly. There is literally billions of people available for you to tap into.
Below is a list of key benefits on why you want your brand involved with Affiliate
Marketing. Think about how you can begin reaping these benefits immediately.
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NAMoffers screens all affiliates.
This includes a phone call, screenshots of earnings from other
affiliate programs, traffic source screenshots, valid id, tax forms,
and payment details.
13. ★ Affiliate Marketing advertisers only pay for verified leads, and/or sales. In other forms
of marketing the fees are paid in advance and there is no guaranteed results.
★ Affiliate Marketing enables an advertiser to tap into many different online mediums,
including: social media, blogs, email marketing, display ads, mobile, etc.
★ Affiliate Marketing breeds innovation and creativity. Since affiliates are only paid a
commission when a lead or sale is created, they must be creative marketers.
★ Affiliate Marketing opens your brand to the latest and greatest marketing trends, and
methods that your company may not have the time or resources to test out.
★ Affiliate Marketing provides you with an army of affiliates who are capable of reaching
every corner of the Internet - tapping into specific niches, groups, and target markets.
★ Affiliate Marketing is measurable, every click, lead, sale is tracked in an online software
that provides 24/7 real time stats. Breakdown your ROI 365 days of the year.
Get your brand or product involved in Affiliate Marketing!
CONTACT US TODAY!
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14. Elements of an Affiliate Program
Do you know where to start when developing an affiliate program?
The idea of Affiliate Marketing is easy to grasp - advertisers compensate blogs, coupon
sites, marketers, and affiliates each time a new sale is created for their product.
NAMoffers is experienced working with over
300 affiliate programs in twenty different niches,
and in over 30 countries around the world.
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15. The biggest challenges for brands, merchants, and product owners is setting up a
profitable, sustainable affiliate program that attracts affiliates, rather than frustrates them.
Keyword: frustrates.
To understand an affiliate, you must go through the processes of setting up campaigns,
creating sales, reviewing return on investments, and managing campaigns.
It may take years to master Affiliate
Marketing - market research, building
landing pages, driving traffic, managing
campaigns, optimizing, among many
things.
Putting effort into your affiliate
channel pays 10X on your investment!
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16. This white paper combines the perspectives of both advertiser, affiliate, and affiliate
network, creating an “insiders scoop” of Affiliate Marketing.
Now, let's tune into the 5 MUST HAVE ELEMENTS to running an affiliate program:
1) AFFILIATE MANAGEMENT
Did you know affiliates have access to ad space on the most visited websites?
Facebook, Google, LinkedIn, Pinterest, among many of the most popular websites
include affiliate ads - people generating a living from creating sales for product owners.
Affiliate Management used to be bloggers, comparison shopping sites, and organic SEO
sites; however in 2015 people around the world are becoming online marketers.
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17. Average people have access to the advertising tools only big brands had access to
previously offline, enabling anyone to place ads on Facebook, Google, etc.
There is also a small group manipulating the developing infrastructure.
Meaning people are generating an income using credit card theft, email spam, self
generated conversions,and many other forms of suspicious behavior.
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18. NAMoffers screens all affiliates.
Screening includes: screenshots of earnings from other affiliate
programs, traffic source screenshots, valid id, tax forms,
and payment details.
Affiliate Management requires years of experience, and a dedicated person to monitor.
The person(s) monitoring your affiliate program is called an Affiliate Manager.
Having a professional reduces risk, and increases results.
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19. Below is two options for finding an Affiliate Manager:
1) You create a new position in your company, and hire a suitable candidate
2) You hire an outsource program manager (OPM) — a 3rd party to manage affiliate
program — the recruitment, communication, and management of affiliates
Think about having 100 or 1000 affiliates - what does that look like?
Questions about Affiliate Management?
CONTACT US TODAY!
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20. 2) AFFILIATE TRACKING SOFTWARE
Do you know which affiliate software makes the most sense for your product?
Your decision may depend on monthly expenses, number of employees, or features.
An affiliate tracking software allows you to track every click, lead, and sale in real time.
The process involves affiliate tracking links, cookies, pixels, and consumers purchasing.
Its simple, yet complicated, and best learned by getting your feet wet.
Affiliates login to the affiliate tracking software to collect affiliate tracking links, download
banners, email creatives, and review campaign details & accepted traffic sources.
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21. Affiliates send traffic to their affiliate link — serve the right message, at the right time, and
with the right emotional hooks, and voila!… a consumer makes a purchase.
Since the affiliate is using an affiliate link from your affiliate tracking software, the sale is
recorded in your software, and you know exactly which affiliate to pay, and how much.
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22. It simplifies business, and makes creating an affiliate program possible.
Below is a list of five “top rated” tracking softwares used by 1000’s of advertisers around
the world - schedule a free demo to see which software is right for you.
1) HasOffers
2) CAKE
3) Hitpath
4) Post Affiliate Pro
5) AffiliateWiz
HasOffers, CAKE, and Hitpath are well known by large advertisers; whereas, Post Affiliate
Pro and AffiliateWiz are used by small business owners, and those testing the waters.
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23. There is another way to go..., and that is to forget the affiliate tracking software, and
outsource your affiliate program to an experienced team of professional marketers.
Get access to a team who handles the heavy lifting (seen below) for zero upfront money!
• Affiliate Recruitment
• Affiliate Communications
• Affiliate Compliance
• Affiliate Screening
• Affiliate Management
• Affiliate Payments
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24. There may be a setup and/or monthly fee in the future, as affiliate marketing continues to
evolve, and become an everyday topic discussed among the general public.
Timing is everything when it comes to Affiliate Marketing in 2016.
NAMoffers provides Affiliate Management
and Tracking at no extra cost.
LEARN MORE HERE
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25. 3) ADVERTISING CREATIVES
How many creatives do you think an affiliate wants for a campaign?
Creatives include: banners on websites, sponsored ads on Facebook, email templates,
landing pages, and the text ads found in search results on Google.
Many advertisers overlook the importance of testing a variety of creatives.
Testing a variety of ads is important. The results of your testings help define the message
you want to use when attracting customers to your business.
Before testing you conduct market research on your target market(s).
You define their age, gender, the books they read, the movies they watch, the feelings
their personality type experiences in circumstances related to your product.
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26. Learn what emotional hooks prequalify your customers to buy.
Discover which banners get more clicks, and which generate more revenue.
Affiliates invest their hard earned money into affiliates campaigns, and affiliate program
must be tested — the landing pages, the banner ads, email creative, everything.
When you provide insights to affiliates, the affiliate immediately knows you mean
business, and is ready to invest money into building your business for a commission.
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27. The amount of excuses big and small affiliate programs come up with when an affiliate
network asks why there is only 1 set of banners, and 2 email creatives.
It's not because advertisers are lazy…
It’s often the lack of importance placed on testing a diverse set of creatives, and ensuring
the people investing in your business feel it's a win/win situation.
Having good creatives sets you apart from the competition, and makes life easier…
Wondering how many advertising creatives is enough?
CONTACT US TODAY!
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28. 4) COMMISSION
Do you know how to figure out a satisfactory commission to pay affiliates?
A good starting point is to decide if you’re looking for leads, sales, or mobile app installs.
Once you define the goal of your affiliate program the picture becomes clearer.
The next step is to reverse engineer your business - calculate your margins by comparing
the costs to gain a new customer vs. the profits a customer creates.
If margins are tight, you need to optimize your funnel to increase the lifetime value of your
customer, as you need margins to pay affiliate commissions.
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29. Affiliates pay attention to affiliate programs with competitive commissions, frequent
payments, and those open to negotiating commissions based on traffic quality.
Below is 3 methods to discover a satisfactory commission for affiliates.
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30. 1) LEADS
How many leads on average does it take to create one sale for your product?
Let’s say, it takes 20 leads to create 1 sale.
1 sale = $40 of NET profit.
Take the total profit, and divide by the total amount of leads it takes to create 1 sale.
$40 divided by 20 = $2 / lead
The maximum you can pay before going in the negative is $2 / lead to affiliates.
It's the advertiser’s responsibility to create additional revenue on the backend (follow ups
& retargeting) to pay $2 / lead upfront, and make 10X on the backend.
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31. If you’re creating 2x, 3x, or even 10x on the backend, you can increase the affiliate
payout, which increases the affiliates ROI, who then increases traffic.
If you pay quickly (weekly), and quality is good, you’re tapping into endless customers.
If you’re unable to increase the lifetime value of your customers, you need to lower your
payout; however, you then risk not attracting affiliates due to low payout.
Affiliates need competitive payouts to create a satisfactory return on investment.
2) SALES
Do you know the lifetime value of one customer?
This is a great starting point for figuring out your commission for affiliates.
There are some quick questions you want to answer below,
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32. - If a customer buys your product, what percentage of customers return and
make additional purchases?
- How much on average are returning customers spending per visit?
- How many times on average are they returning to make a purchase?
- Is there a monthly fee to continue using your product/service?
- If so, how many months on average does a customer continue to purchase?
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33. Many key performance indicators are easier to measure online vs offline, as you’re
collecting, and confirming the customer's information on each lead, and purchase.
If you’re unable to answer these questions, start brainstorming processes to capture this
information, and start understanding your business from the top down.
If you know these details, you’re well on your way to success!
3) APP INSTALLS
There are a few considerations when running app installs in Affiliate Marketing.
Answer the below questions to figure out what commission is possible for your app.
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34. - Do you have in app ads in the free version of your mobile app?
- If so, how much on average is one person generating in advertising revenue?
- Does your app have a digital currency users use to upgrade items?
- If so, what percentage of users make in app purchases?
- What is the average amount one user spends on in app digital purchases?
- Does your app have the option to upgrade to a paid version?
- If so, what percentage of users upgrade to the paid version?
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35. Once you know the answers to the above, you know how many app installs it takes to
create a paying customer, and how much revenue these customers generate.
A wise man once said... “Know your metrics, and stay within them.”
Do you need assistance figuring out what commission to pay affiliates?
CONTACT US TODAY!
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36. 3) PROVEN AFFILIATE OFFER
There is a good chance you know what a proven affiliate program is now.
The above sections pointed out the key ingredients on creating an affiliate program, and
may have provided ideas for tweaking your current program.
The biggest challenge is managing the affiliate program - finding affiliates, and buying
traffic to find out what works, and doesn’t work, so you can share data with affiliates.
You’re gonna need affiliates, a tracking software, and a product people want.
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37. There is plenty of successful affiliates ready, and willing to build your brand. Just imagine
a team of affiliates promoting on your behalf…
Your ad is all over Facebook, Pinterest, Google, Bing, the daily websites your friends, and
family visit, and the sales are pouring in. Anywhere you look, your ad is sitting there.
You have a team monitoring the leads, and sales to ensure you’re profitable.
Those partners underperforming are paused, and those partners providing satisfactory
results are rewarded w/ higher payouts & quicker payments in exchange for more traffic.
That’s how an affiliate program is running when it's managed correctly.
An affiliate program is a long term investment, as you need to be inventing, and
reinventing your brand - keeping one step ahead of your competition.
Once you know the process, you may choose to develop multiple affiliate programs - you
can double, triple, or even quadruple your income quickly by following the same steps.
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38. The most important elements in creating a proven affiliate program are found below:
1) Product with Mass Appeal
2) Tested Creatives (Banners, Emails, Landing Page, Presell Pages, etc)
3) Aggressive Affiliate Payout
4) Affiliates
5) Monetization - Frontend & Backend Monetization Systems (10X revenue)
An affiliate program with mass appeal is as simple as “meditation”, “yoga”, “guitar
lessons”, “gardening”, “bodybuilding exercises”, among many product niches.
The idea is to create a product that reaches millions, rather than hundreds. Developing a
robust monetization system is key to getting a step ahead of the competition, as you
know your margins, and the ability to offer aggressive affiliate payouts is available.
Need help putting all this together?
CONTACT US TODAY!
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39. Affiliates
Do you know what methods affiliates are using to promote products online?
It’s almost a full time job keeping up with new ad placements, and traffic sources.
There are thousands of people promoting affiliate products, and there are hundreds of
traffic sources available to affiliates to promote your product across the internet.
NAMoffers developed Affiliate Expert Academy,
the #1 resource for learning affiliate marketing and
mastering the building blocks of building an online business.
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40. You can tap into their experience, and creativity to generate millions of dollars.
The important part is you know the type of affiliate you're working with, the traffic source
the affiliate is using to drive traffic, and the basic strategy used to qualify customers.
You can then feel comfortable having other people promote your product.
Below is an outline of the different traffic sources available:
• Content Advertising: Affiliates in this category include blogs, native ads, review sites,
forums, etc — and is often viewed as a “natural” way to advertise to consumers.
• Comparison & Coupon Sites: Affiliates in this category use their sites to compare
prices, and features on products, and/or provide coupons to consumers
• Display Advertising: Display advertising is a type of online advertising that comes in
several forms, including banner ads (images), rich media (videos) and more.
• Email Marketing: Email marketing is directly marketing an advertisement (newsletter
or stand alone) message to a group of people using email communication.
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41. • Incentive: Affiliates include loyalty programs — cash back, reward, and voucher web
sites. — users are rewarded with cash or points for signing up to offers.
• Mobile Advertising: Mobile advertising is a form of advertising via mobile (wireless)
phones, tablets, or other mobile devices. It is a subset of mobile marketing.
• Native Advertising: A type of online advertising that matches the look and feel of the
website it appears on. Affiliates use top 10 lists, product review sites, trending news,
and how-to guides as forms of native advertising in the affiliate channel.
• PPC Advertising: Pay-per-click marketing is a way of using search engine advertising
to generate clicks to your website, rather than “earning” those clicks organically.
• PPV Advertising: PPV works similar to PPC. You input a destination URL and then bid
on either keywords or URL's. PPV ads are typically served as a text ad or pop up.
• Retargeting: Retargeting drives potential customers back to your website by targeting
users who have previously visited your website but didn't sign up or make a purchase.
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42. • Social Media: Social Media (People Based Marketing) includes Facebook, Instagram,
LinkedIn, Pinterest, Twitter, Youtube, and other emerging social media platforms.
• Video Advertising: Affiliates in this category create vieo ads that are served on
Facebook, Youtube, and other video distribution channels. Similar to television ads.
In-House VS Affiliate Network
This last section is a big winner with many of the readers. If you made it this far in one
sitting, you’re likely on the edge of your seat buzzing with energy.
Some skip right to this section because it's the last section, and hey that is just fine.
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43. The above sections educate, and this section sums everything up in quick point form.
It’s easier to see the benefits when it’s written out in point form, and the pros and cons
are staring you right in the face, like “heyyyyy, here are your answers!”
Simple vs Complex
You may want to go back through a second time, and make your own notes.
Some already created a plan of action (hiring, delegating tasks, outsourcing) to start
testing, tweaking, and optimizing their affiliate program to create a proven offer.
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44. Take a few days to digest the information.
If you’re learning about Affiliate Marketing for the first time, you may need to read this a
couple times. It’s a new language, simple, yet complex, and spoken by millennials.
That’s what this white paper is all about - taking notes, creating a new perspective, being
open to improvements, and creating a conversation within your community or tribe.
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45. One of the best ways to help you make a decision is…
Think about it, talk about it, ask questions, get perspectives, and make a decision.
Here are the pros and cons that will help you choose:
IN-HOUSE PROS
• In-House affiliate programs get full control of the tracking software, giving the ability to
implement advanced applications, and integrations.
• There is no ‘Middle Man’ fee for outsourcing to an affiliate network.
• Direct contact with affiliates for feedback, incentives, and relationship building.
• There are no network fees, allowing you to pay affiliates more.
• Real-time accessibility to data on affiliate traffic sources, methods, etc
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46. IN-HOUSE CONS
• In-House affiliate programs is a full time job, and take time to launch, as you need to
test, tweak, and optimize your affiliate program.
• No immediate access to large database of affiliates.
• Requires a bookkeeper to manage, and process monthly payments.
• The affiliate tracking platform software is complex to set up.
• Potential for fraudulent affiliates who burn your customers.
• Affiliate managers require training, and there is a large learning curve.
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47. AFFILIATE NETWORK PROS
• Instant access to a wide variety of professional affiliates.
• Affiliate networks have expertise with hundreds of advertisers, which means you gain
access to valuable insights on how to optimize.
• Extensive experience screening affiliates to ensure quality traffic.
• Affiliate managers communicate with affiliates weekly.
• Compliance team reviews referral links of every click, lead, and sale provided to
confirm traffic is authentic, and meets quality standards.
• Affiliates networks provide Affiliate Marketing resources, and training.
• Process one payment to affiliate network, rather than paying each individual affiliate.
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48. AFFILIATE NETWORK CONS
• Offers may be placed alongside competition, meaning you may need to compete with
similar advertisers with competitive programs.
• Less control adding new applications to the affiliate tracking software.
• There is a “Middle Man” fee collected by affiliate networks on each sale.
• Susceptible to fraud if affiliate network isn’t screening correctly.
• Your offer may get “lost” in the hundreds of offers in affiliate network.
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49. Conclusion
At this point, you know more about Affiliate Marketing then the average company does.
You are locked, and loaded w/ the information to generate millions of dollars. There is
plenty of testing, tweaking, and affiliate commissions to be paid out in your lifetime.
Affiliate Marketing is thriving, and there is endless traffic, and customers available.
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50. There is the potential to have 100’s of affiliates promoting your product.
This business model isn’t new — Affiliate Marketing is highly
recognized by Amazon, Facebook, Coca-Cola, Google,
Microsoft, and the majority of large brands.
There is an abundance for niche products to grow — Affiliate
Marketing is for any product, merchant, or advertiser looking
to develop new customers on a performance basis.
Affiliate Marketing is a performance based model.
Affiliate Marketing is becoming the largest distribution channel in the world.
Bigger than Walmart! Bigger than Amazon! Bigger than Alibaba!
Bigger than whatever big box “drone delivery” chain is coming out!!!
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51. This white paper sets the bar (expectations) for advertisers looking to develop a high
performing, profitable affiliate program for both advertiser, and affiliate.
You have the basic information to research more, and look into hiring the right people.
You have the resources, and connections to outsource your affiliate program.
To learn more about becoming an advertiser with NAMoffers, visit NAMoffers
If you’re interested in learning about the affiliate side of the business, visit Affiliate Expert
Academy — a resource created by NAMoffers for affiliate marketers to learn and grow.
Wishing you best of luck on your journey in online advertising!
-MRx
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52. To schedule a call with NAMoffers advertiser team, contact michael@namoffers.com
“If you build it (affiliate program), they (affiliates) will come”!
Michael Rich
Co-Founder | Advertiser Director
Michael Rich:
NAMoffers:
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