Why Your SaaS Business Needs an Affiliate Program

Chris Stocker

Estimated read time: 3 minutes, 44 seconds

Starting, or investing in, an affiliate program is a great idea for just about any ecommerce company. This is even more important for a software-as-a-service (SaaS) company.

Here are seven reasons why every SaaS company should start—or invest in an affiliate program.

1. Loyal Customers Can Help Drive Revenue as Affiliates

A SaaS affiliate program makes it possible for a customer to sell and market the product they already use to others. If a customer is happy with the SaaS product that they are using, plus, they are able to earn a commission for promoting it, why wouldn’t they? This ultimately creates an ever-growing digital salesforce to help promote your SaaS product. Your customers benefit from having the close relationship to your product, and new customers are able to work with knowledgeable affiliate partners that can answer all of their questions.

2. Your Affiliate Program is Useful for Promoting New Products

When you have an established affiliate program that is driving sales and also recruiting additional affiliates in your niche, you have all the pieces in place when it’s time to launch a new product. For example, let’s say you are an accounting software company and you are getting ready to launch a brand-new tax assistant software. Your affiliates are ready to help you promote your product to the market and encourage user-generated content. And your affiliates are motivated by the incentives that you feature in your affiliate newsletter announcing the launch of the new tax assistant software.

3. You Only Pay for the Customers You Acquire Via the Affiliate Program

When it comes to affiliate marketing, most affiliate programs only pay out after a transaction has occurred. For example, you pay out a commission when a new customer purchases your product. In some cases, you may have a free trial version of your product that pays out a much lower commission in hopes that free trial turns into a paying customer in the future.

This can help you with your Customer Acquisition Costs (CAC). Now, an affiliate program does not mean that it is going to lower your CAC, however, when structured right, you are only paying for a new customer. With other forms of advertising like search engine optimization, paid search marketing, etc., you are paying for clicks or search results, and may be spending money without actually making a sale.

4. Affiliates Love SaaS Affiliate Programs

Affiliates tend to love SaaS affiliate programs for many reasons. One of them being that most SaaS companies offer a free trial version of their product which people are more motivated to sign up for. The affiliate may not make the full commission until someone converts into a paying customer, but for the affiliate, getting their visitor to sign up for the Free Trial is a lot easier than going right into paying for something up front—especially when it comes to high priced business software.

5. You Can Motivate Affiliates by Offering Recurring Payouts

SaaS is one of very few niches where affiliates can enjoy ongoing compensation for the business that they refer to the company. And who doesn’t like recurring payouts? Not all SaaS affiliate programs use this powerful strategy for motivating affiliates, but those that do are seeing amazing results.

As a SaaS company, you have the ability to track customers, orders and recurring orders. Implementing payouts on recurring orders for affiliates is a great way to keep them motivated and incentivized.

6. It is the Perfect Space to Explore Co-branding

Co-branded marketing is a great way to help increase conversions. Partnering with a prominent affiliate in your niche, for example, CNET.com and PCMag.com, to create marketing campaigns with that specific affiliate including co-branded landing pages will ultimately help you grow your sales and also your affiliate’s income.

This will also create a much stronger relationship between you and the affiliate. In affiliate marketing, relationships go a long way. The next time this affiliate is offered a deal from one of your competitors, having this relationship and co-branded marketing will ensure that your deals are given priority.

7. You Can Take Advantage of Influencers’ Clout

Another great reason to start or invest in an affiliate program as a SaaS company is leveraging influencers’ clout to reach their audience. Partnering with influencers in your niche with large followings through your affiliate program will allow the influencer to share their affiliate links through social media. This way, you are reaching their audience and paying for leads or sales.

Chris Stocker

Chris Stocker is an affiliate marketing and SEO expert who works for AM Navigator – a top affiliate marketing program management agency. As an affiliate marketing agency, AM Navigator contributed to the online marketing successes of brands as large as Forbes, Hallmark, Medifast, Skype, HubSpot, Travelex Insurance, as well as hundreds of small businesses. Chris has managed affiliate programs since 2007 and is deeply passionate about all things affiliate marketing.
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