Affiliate Programs

Entering into a profit-sharing relationship with the right online vendors can increase your bottom line. Here are some guidelines.

by Rachel Luxemburg courtesy of HowToSell.net [September 3, 1999]

One of the fundamental tenets of marketing is that there are only two ways to increase sales: get new customers or sell more stuff to the ones you already have.

Value-added services (like web hosting, additional e-mail accounts, 800-number access, etc) are a good way to sell more to your customers. Another option is to partner up with some of the myriad vendors who will tell you that their software package (VoIP hardware, roaming plan, or whatever) will bring you untold revenue streams . . . if you buy their product. Maybe they're right and maybe they aren't, but there are times when you just don't want to invest a chunk of money up-front finding out.

Success through affiliation
That's where affiliate programs come into the picture. The success of big-name programs like Amazon.com's Affiliates has spawned hundreds if not thousands of affiliate programs on the WWW today, giving webmasters the chance to make money by offering everything from car buying guides to resume services on their websites. The selling partner wins because s/he gets more sales at a low acquisition cost. The affiliate gains revenue with no cash outlay. Assuming the program is well-matched to your customer base, they're a win-win all around.

Obviously, some of those programs won't work terribly well for the typical ISP, but well-chosen programs can be extremely valuable. Not only can affiliate programs help increase your revenues, they can also be a selling point for new customers and a tool to help increase customer satisfaction and reduce churn. Consider this: The more things a customer buys from you, the more s/he sees you as an authority on all things related to the computer, the more dependent on you s/he becomes.

Big four
Here are the top four areas to consider adding to your website and service offerings. I'm including some links to check out, but if you want to shop around, a fairly complete list of affiliate programs (including descriptions, facts, and ratings) can be found at Refer-It:

•   Software

  You probably already give your customers some basic Internet software when they sign up with you (if you don't, that's a topic for another day), but there are still plenty of other tools you can sell them. Virus-scannrs, HTML editors (Tip: don't sell FrontPage unless you support FrontPage extensions, that's just asking for trouble), content filtering programs for your family customers, backup or undelete utilities. . . . The list is endless.

  Beyond.com is probably the biggest and most reputable of the software company affiliate programs. You can check them out at beyond.com.

•   Hardware

  Faster modems are a no-brainer. Also think about ZIP drives, more and bigger hard drives, backup tape drives, and monitors. If you have a high percentage of professionals in your customer base, PDAs and their accessories are hot too.

  There aren't as many hardware affiliate programs around as there are other types, but NECX has a "Hotlink Affiliate" program you can check out.

•   Books

  The "Dummies" and "Sam's Teach Yourself…" series are a good place to start, but don't focus completely on entry-level books. Don't forget books on doing business and marketing online as well as the technical how-tos.

  Amazon.com is the 800-pound gorilla in the book sales category, but Barnes & Noble has a few more features (and offers software as well), and is well worth a look

•   Training

  Online and/or interactive training courses are another potential revenue stream--and if enough customers sign up for them, they have the added benefit of giving you a more educated user base.

  DPEC has a somewhat popular service, but there is an up-front cost to become a DPEC reseller. A cost-free option to consider is ComputerLiteracy, which offers both books and interactive training. Also popular is Ziff-Davis's ZD University.

Final thoughts
One potential drawback of selling hardware and software to your customer base is support issues. If you have the capability to provide support for third party hardware and software, you might want to think about selling a "service contract" which would cover anything purchased through these affiliate programs. If not, you should make it clear to customers that your tech support department will not support third-party hardware and software. Either way can work as long as you are clear and consistent in your policy.

The actual amount of revenue you can expect to make from affiliate programs varies widely, depending on the size of your customer base, how well you choose and present your product offerings, and how well you advertise their existence to your customer base. Don't expect too much starting out, but definitely solicit feedback from your customers to help fine-tune your offerings.

—End

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