A few weeks ago we told you what is Affiliation Marketing and how it works, as well as explaining what an affiliate network is and what an affiliate does. Today we are going to go a little further and we are going to see which are the main affiliate networks and what costs we are going to have to face as an advertiser.
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All affiliate networks have a very similar operation at the technical level and the most powerful affiliates usually work with most of them, so the decision on which network to use depends on the costs, the market to which we address , the level of service they offer us and the sensations that the platform transmits to US.
During my stage in Neo @ Ogilvy I worked mainly with 5 affiliation networks, among which are the most important in the world. My job was to manage my clients’ affiliation programs, so I know the platforms from the Advertiser’s point of view. Let’s take a quick look at them.
It’s a Swedish company that’s been running since 1999. They are leaders in Europe, where they have the largest network of affiliates and advertisers, and have an important presence in Spain. In my opinion, they have the most powerful technology and the most reliable tracking. Your platform is full of possibilities but it is complex to use for someone who is not familiar with this kind of tools. If you want to work with this network, I recommend that you contract a specialised agency to take all its potential to the platform. If you are a big advertiser, you have the possibility to buy Tradedoubler technology and open your own affiliate program.
This network of affiliation was born in Germany, where they have a great presence. It is together with Tradedoubler the network of affiliation with greater implantation in Spain and at European level they are quite even in terms of volume of affiliates and number of advertisers. For my personal taste, the platform is not so intuitive, but it has been shown equally valid to sell.
It is an affiliate network of the United States, where they have a large network of affiliates and where they are clearly market leaders. In Europe, however, they do not have so much presence. Personally, I had difficulty understanding with the platform at first, as some processes are handled differently from the rest of networks, but once you get used to works great.
It’s a network of German origin. In this market the leadership is disputed with Zanox. In my opinion they have the easiest platform to use all of them. It’s very intuitive and friendly, so I recommend it if you want to open an affiliate program and manage it yourself. Although if so prepare to take hours because in the world of affiliation the operation is quite large.
It is one of the most important platforms of affiliation in France and Portugal. It usually has medium-sized advertisers. Its platform is quite simple and I think its main virtue is that they are very flexible, so they adapt very well to the needs of its advertisers.
Apart from these, there are more networks of affiliation, like Tradetracker or Public Idees, with which I have not worked but that are equally valid if you do not like any of the previous ones.
When you go to talk to the affiliate networks, you may have a little trouble with the issue of tool costs. To know what will cost us the start up and maintenance of an affiliate program, we have to take into account the following fees:
When you open a program, most networks will ask you for a fixed amount that is paid only once and that covers the technical implementation and the start-up of the program. If you are a great brand you can get out for free, but if you don’t probably touch pay.
The majority of networks offers a service of management of the programs, this materializes in the figure of a account manager that is in charge of operative topics like the ascent of Creativities, the contact with the affiliates, etc. Usually the accounts Manager carries a lot of bills at once, so if you are a small brand and want to be pampered better hire a specialised agency.
Some networks try to ensure the profitability of the programs by setting a minimum fee, this is a minimum amount that advertisers must pay monthly if the sales generated through their program are less than an agreed amount.
One of the main costs of opening an affiliation network is the commissions to be paid to affiliates for the sales or leads generated through their campaigns. You can pay a fixed amount by conversion or a percentage of the value of it. The level of Commission depends largely on the product or service that is marketed. In the hospitality industry, for example, it is between 6% and 10%.
The network is left with about 30% of the affiliate’s Commission. It is not an extra cost that we have to add to the above, but it is included in the Affiliate Commission that commented previously.
In the end, what costs you an affiliate program will depend on direct negotiation with affiliate networks. You can probably get a more advantageous condition if you are a strong brand or if you have a high sales volume.
As you can imagine, the world of affiliation is complex and involves a lot of work. The choice of the network is only the first step. To start the campaigns from here you must build relationships with affiliates and the success of your program will be based largely on the way you do. No doubt, Affiliation Marketing is a world of possibilities that can be very profitable if you know how. Do you dare?
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