In a constantly expanding online world where the cost of a purchase-happy customer is increasing every day, the performance-based nature of affiliate marketing sets itself apart from the rest. The always critical CPA metric is the one that every affiliate needs to figure out in order to grow and maintain profitability. It will vary from channel to channel, as only a very small percentage of visitors who land on your site will convert. That means, between browsing and actual shopping, the funnel is getting tighter while the cost of making a conversion is getting higher.
It’s tempting to up the stakes by pumping some cash into your campaigns for better results. However, if your effort isn’t properly managed from the get go, you can bet there are certain elements of your affiliate operation that are bringing zero value to you. Most importantly, there are wasting your funds, which is the central theme of this post.
Outsource for better results
Obviously, better results “mean stop losing your money” and invest it in someone else. But how does paying someone constitutes as not losing money as you’re reaching for your proverbial wallet and fronting up the cash? Here’s how.
Try to look at it from a different angle. For affiliates, there are some basic costs like domain and hosting that are bare necessities and these are taken for granted. Then, there are some extra costs that are the real reasons why you are losing money. Things like keyword research, content creation, various tools and services and so on - these cost-associated aspects can seriously bite in on your available funds and diminish your entire effort. The solution is to scout around for a quality, low-cost outsourcing.
So many times affiliates miss out on opportunities that can make their work so much easier because they simply think they are unable to afford them. With a global community few clicks away, there are enough options to hire help that can either do a better job than you for the lower or even same price. A small example - one of the better social media tips for affiliates is being entertaining with your content. That demands a bit of knowledge with words that goes beyond a simple product review or borderline generic content that usually pleases the masses. Not everyone is a wordsmith but there are some people that are and affiliates can certainly benefit from their expertise, all for the right price.
In any case, you wind up with increased profitability either through a more engaging content, better optimized paid marketing effort, better website design or functionality - the list goes on. If you’re still unsure about outsourcing, here’s our final thought on the subject. Spending money on help ultimately creates a bigger investment, which effectively translates to more incentive to make it work.
Deal with how you manage your payments
How you manage your financials talks volumes of both you and your affiliate operation. With affiliate marketing being a game on numbers, none are more important than those in your balance. And currently, those numbers are shrinking. Maybe it’s because it’s a dry spell at the moment - it happens, not every campaign can be a winner. However, it’s more likely a symptom of an underlying disease - a costly payment provider.
Payments are, undeservingly so, at the bottom of affiliate concerns. They are always a welcome addition and as such, taken for granted. What many affiliates don’t realize is that different payment solutions have different cost-saving or cost-making abilities, depending on their configuration. For instance, banks are among the widely spread and accepted solutions, especially for international transfers. They are routinely the means of transferring larger amounts through wire transfers, even if they are, also routinely, among the costliest service in terms of fees and conversion rates.
With a little research, you’ll uncover the other side of the equation - specialist payment services that are more in-tune with the online movements. There are various options on the market like MoneyNet that generally have lower fees for international transfers and more functionalities (or liberties - that’s another way of looking at things) than their traditional counterpart. For example, affiliates are able to open up a genuine bank account under their name in several countries worldwide, for free as the entire process is done online. Then, those with worldwide spread have the option to convert their funds to the currency of their choosing prior the withdrawal. This is important as it successfully navigates around a fee for receiving money in a foreign currency as set by banks, but also more expensive non-bank providers like PayPal. All this is done with much more favorable rates (mid-market rates), which rounds off the cost-cutting factor for the day. Another benefit of such payment solution is the ability to pay for various elements of affiliate campaigns and/or other services at highly attractive rates.
Get rid of no-sale traffic
Having traffic is the cornerstone of a healthy affiliate effort. However, due to the large scope of affiliate operations, some affiliates tend to feel pressured by the competition and compete on all kinds of traffic. That is why it’s imperative to separate relevant traffic from the rest that brings you no sales. While this may sound redundant, affiliates are notoriously persistent people, up to the point where it becomes an uphill battle to make a campaign a winning one at all costs. Say you have opted to promote a product via a paid advertising platform like the ones we previously mentioned. Almost every platform provides built-in tools for insights into where your traffic is coming from and where it’s going. By focusing your affiliate efforts, as well as the budget, on platforms that yield the top results, you can significantly reduce your CPA.
Word of advice: don’t rely on the Pareto principle in this case as it’s no good. Spending 80% of your budget to get 20% sales just won’t cut it this time. That cuts right into our next entry...
Don’t spread yourself too thin
Plugging the leaks in terms of costs also means taking a different route. Instead of joining multiple affiliate programs to catch up on your desired income, you should focus your efforts on a handful of affiliate programs that are well-designed for your website. Promoting a number of products and services can obviously be demanding on your wallet. Furthermore, there is also the question of relevant traffic. Do you really have enough of it to make a profitable campaign? Even if your readers see interest in your promotions, do they come in numbers? Is it really worth ramping up the ads and investing time and money? Probably not, so stick to the tried-and-true programs.
No one can deny that it takes time to grow your affiliate operation. Still, that doesn’t mean keeping your one eye closed to the money dripping while you try to make the best of it. This can be stopped as there are always options out there. Man up to your mistakes, take advice outlined in this post and before you know it, things will start to improve. To err is human, to correct is... also human, and smart.