A Software Publisher’s Affiliate Program Experience

March 27th, 2010
Estimated read time: 6 minutes, 0 seconds

Recently a software publisher asked some questions about affiliate programs on a forum. He’s had an affiliate program for about 6 months and is disappointed in the results. He’s using a small affiliate program tied to an ecommerce service, as opposed to using one of the large 3rd party affiliate networks which hosts affiliate programs for many well-known software companies and has tens of thousands of affiliates of all types.

He’s so far only getting 2-3 new affiliate signups each day, and has a total over 6 months of about 100 affiliates. When he searches online, he’s unable to find affiliate links pointing to his site even though the majority of his affiliates signed up some time ago and have had ample time to add links to his site. He has emailed some of his affiliates but got no replies back. His affiliate program is set to “auto-approve” new affiliates who want to be part of his program. He is yet to pay out any commissions due to the lack of affiliate traffic. His affiliate account manager hasn’t been able to help him to improve the results unfortunately so far. He’s not sure what’s gone wrong and he asked for some guidance. Here were my thoughts which I shared with him, in case this is helpful for others… I think there are a few issues at play here:

As silly as it seems, the majority of affiliates who sign up for an affiliate program will never add a link to your site or do any other promotion. That’s just how it goes with affiliate marketing (and often in marketing in general). You have to appreciate the ones that actually do something post-sign-up as they’re few and far between.

As you mention, it’s good to communicate with them to encourage and even incentivize them to add links, though as you’ve seen most don’t respond. A lot of affiliates are signing up just to check things out such as your ads and products or affiliate offer, or because they think someday they may want to add a link, or they may want to buy your product themselves at some point and save themselves money, or for a host of other reasons. It’s the same kind of perplexing marketing challenge as when most people who land on a website don’t take an action, why 1/2 the people who start a download never complete an installation, why so many people abandon shopping carts, why so few people who download and try a software product actually buy it, and so on.

Most of the top affiliates out there are not members of software-specific affiliate programs tied to a particular ecommerce system. I can tell you from experience, but just think about it…if you were a top affiliate, where would you invest your time/resources/efforts? Commission Junction (CJ), LinkShare, ShareASale, Google Affiliate Network (formerly Performics), etc. where the best quality advertisers and affiliate systems are, including lucrative, at times well-known consumer software affiliate programs. I don’t have a lot of experience with Clickbank, though I’ve heard of both positive and negative experiences. As an affiliate, you likely haven’t even heard of the names of software-specific ecommerce companies much less those firms’ affiliate networks. This is why instead of having our own affiliate program, at FastSpring we integrate with the leading affiliate networks so that you can access those networks which have attracted the large affiliates who can really generate substantial revenue for a software publisher. With that said, there are no doubt some exceptions, and there are some who don’t have success with the larger networks in the end as well, but most software vendors will end up disappointed if they expect significant revenue to come from the ecommerce-specific affiliate networks. We’ve been doing this a long time and have ourselves been software publishers in numerous affiliate networks of all stripes. These larger affiliate networks also tend to offer more extensive affiliate management functionality than the smaller networks.

If you do end up being one of the few vendors that has success with an affiliate program that is tied to an ecommerce service, you have a new problem in that you’ll be increasingly tied to that ecommerce service so if your overall ecommerce experience becomes poor (bad customer service, rates increase, platform never gets updated, etc.), you’ll be stuck with that ecommerce service and the problems you’re having there since you’ll have a tough time leaving behind the affiliate program you built with that ecommerce service as opposed to a 3rd party program which is separate from your ecommerce service. You don’t want to be that tied to your ecommerce service, even if it’s FastSpring; it’s just not a good business practice to create such barriers to being able to switch if you run into trouble. You always want to be in a flexible situation where the ecommerce service doesn’t have so much leverage over you.

Be careful having your settings on auto-approve. You may find out later that that was a mistake. In my experience, it’s OK to auto-approve affiliates who reside in the standard countries, but if you auto-approve in certain countries that tend to produce a lot of affiliate fraud (Vietnam, Nigeria, etc.) you may end up being taken for an expensive ride. I have nothing against any country, I’m just speaking from my affiliate marketing experiences. I recommend reviewing applications from certain regions.

By the way with some of the larger affiliate networks like a CJ.com, you’ll get at times hundreds of new affiliate sign-ups per day (you mentioned getting just a trickle of signups), though the same will be true that only a small percent will ever be active.

You’ll want to offer a good breadth of different ad types (banners, keywords, html email perhaps, coupon offers, product pages, etc.).

FastSpring has rolled out an affiliate campaign management service whereby an affiliate expert personally manages and grows software vendors’ affiliate program revenue. The program manager works the affiliate program just like a customer acquisition funnel by increasing recruitment, link placement and the number of affiliates generating sales. However, there is an added cost to it and so it only makes sense to consider if you have an affiliate marketing budget in the thousands, which means it unfortunately isn’t a good fit for every situation. With this said, if the opportunity is the right fit, a revenue share structure can often replace the need for a base fee. More info on the affiliate program.

Over time in growing your business you’ll find that in most cases, the best affiliates are often those you recruit on your own as strategic partners. The best way to find those is to research companies/sites that you think might have a strategic interest in sending some traffic your way. In many cases the partner you contact will be willing to drive new customers your way in exchange for a revenue share since the audience and product fit are of strategic value to your partner and to their customers. Logistically, you can use your affiliate program to manage the relationship if you’d like, or (provided you’re setup to track your order page via Google Analytics) you can track your partners’ promotions.

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