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Why Two-Tier Affiliate Programs are Best


When you join an affiliate program or start an affiliate program of your own, you have to decide whether it will be a single tier or two-tier affiliate program.

With a single tier program you earn a commission on any sales you make and that is it. If you are running your own affiliate program, you pay your affiliates a commission for any sales they refer and that is all.

However, with a two-tier program, affiliates are allowed to recruit sub-affiliates and are paid a small percentage of the sales these sub-affiliates generate. For example, the affiliates may earn a 30% commission for selling product X himself; and when one of the sub-affiliates makes a sale, the affiliate may get a 10% commission as well. This is very profitable for the affiliate as he can recruit an army of sub-affiliates, all earning commissions for him without any effort on his part except for the initial recruiting process.

If you are starting an affiliate program of your own should it be two-tier or single tier? Some might shy away from the seeming expense of a two-tier program. But is it really that expensive? Many affiliate program managers make the wrong decision on this.

Let's look at an example. You have an affiliate program up and running and an average affiliate joins your program. Mr.Average has a web site that receives average traffic. He also has an ezine with thousands of subscribers published monthly. Mr. Average posts your affiliate links to his web site and promotes your product to his ezine list.

Initially, he generates good sales. However, a point comes when he saturates his market with your product and his sales begin to drop. He begins to lose interest in your program and your sales remain small. What happens if you set up a two-tier program? Rather than trying to keep your commission pay outs small, you motivate your existing affiliates to recruit other people to your program. This will exponentially increase your affiliate sales. Would it not be worth paying the referring affiliate a percentage of their sub-affiliates' sales? Now when Mr.Average joins your affiliate program this is what would happen. When he has saturated his market with your product, he would now promote your affiliate program to his customers and ezine subscribers. Many of Mr.Average's customers and subscribers decide to join the affiliate program. This in turn will motivate Mr.Average to continue promoting your products and recruiting affiliates.

Now what is the situation?

1) Your income increases because of increased sales.

2) You have a much larger customer base to which you can sell 'backend' products.

3) An increase in your income because of the life time loyalty of the customers referred by your affiliate.

4) An army of sub-affiliates who will sell your products, and in turn promote your affiliate program to their customers and subscribers.

The little extra in affiliate sales commission pay outs will be more than compensated for by the exponential sales increase. This is why the two-tier affiliate program is a guaranteed winner and should be the automatic choice for potential affiliates and affiliate program managers.

© John Lynch

For details of the SiteSell affiliate program with lifetime customer commissions, residual commissions through renewals of Site Build It, and 2-tiers of income go to: http://affiliates.sitesell.com/finian.html


Todays News by officejax surplus outletMORE AFFILIATE REVENUE RESOURCES updated Mon. April / 12 / 2021

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Vice is finally entering the affiliate space, but is drawing a firm line between edit and commerce  Digiday

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3 Steps To Succeed With A Side Hustle In Affiliate Marketing  Forbes

Blue Cross of Minnesota affiliate sold for $500 million - Minneapolis Star Tribune
Blue Cross of Minnesota affiliate sold for $500 million  Minneapolis Star Tribune

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Wash. Tax Dept. Finds Co.'s Contributions To Affiliate Taxable  Law360

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Why Affiliate Marketers Need Ad Tracking Innovation Now  MarTech Series

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Affiliate Software Industry Market Innovative Strategy by 2028 | Target Circle, Codewise, JROX Technologies  The Courier

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Can affiliate marketing really boost your sales? - AffiliateINSIDER  AffiliateINSIDER

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Catena Media to post record first quarter revenue and earnings  Gaming Intelligence

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Powerball at $67M: Wednesday's drawing, who won big cash recently and more  CNET

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Sandals Resorts' Worldwide Representative Affiliate Announces Expanded Leadership Line-Up  PRNewswire

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Naspers affiliate Tencent reports blowout earnings  TechCentral

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The Affiliate Marketing Podcast – Common mistakes affiliate programs make and how to fix them  AffiliateINSIDER

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Premium Streamers Consider New Reality: Ad Counts, Metrics In Pricing 03/17/2021  MediaPost Communications

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Live Streaming Can Drive Affiliate Revenue  Practical Ecommerce

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Pure Extracts to Enter US Market through JV in Michigan  GlobeNewswire

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Amazon slashes commission rates for program that gives publishers a cut of sales  CNBC

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REPEAT -- Pure Extracts to Enter US Market through JV in Michigan  GlobeNewswire

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Fox's revenue rises on advertising, affiliate fees  MarketWatch

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The Enterprise Development Authority -- Moody's announces completion of a periodic review of ratings of The Enterprise Development Authority  Yahoo Finance Australia

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How Wired leveraged Cyber Week readers to increase subscription revenue  Digiday

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Facebook starts displaying state by state vaccination notifications  Yahoo Tech

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Do affiliate links undermine the marketing value of holiday gift guides? – RetailWire  RetailWire

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What Is Affiliate Marketing? A Guide To Success  Built In

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We Are Living In An Affiliate World  Forbes

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Using Affiliate Marketing to Increase Sales. How Does it Work?  Business 2 Community

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Airbnb ends affiliate program as it ramps up host recruitment marketing campaign  CNBC

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Affiliates, Amazon's Forgotten Marketing Channel  Marketplace Pulse

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Beyond the boom and bust cycle: How The Sun grew and stabilized its e-commerce revenue haul  Digiday

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How 2020 Will Shape Future Affiliate Growth  PerformanceIN

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For Influencers, Affiliate Revenue Is Next to Disappear  The Business of Fashion

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As Amazon Slashes Affiliate Referral Rates, Publishers Consider Alternatives  Forbes

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Here’s A Look At The Impact Of Coronavirus (COVID-19) On The Affiliate Marketing Industry  Forbes

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‘Marketing at maximum intensity’: Publishers ready for rocketing ad spending from streamers in 2021  Digiday

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Affiliate marketing: How publishers earned in the pandemic  Press Gazette

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Publishers love getting affiliate revenue from their reviews. So is it okay for Amazon to pay to get more of those reviews upfront?  Nieman Journalism Lab at Harvard

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The Best Affiliate Programs for Monetizing Your Site  Riverfront Times

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Better Collective Q3 revenue up as non-affiliate income offsets low margins  iGaming Business

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Top affiliate marketing programs, companies, networks for influencers  Business Insider

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What to Know about the Paycheck Protection Program, Round Two – First Draw PPP Loans  JD Supra

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BuzzFeed Starts Selling Products Directly to Consumers  The Wall Street Journal

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ViacomCBS Reports Q3 2020 Earnings Results  Business Wire

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Brand Affiliates 101: What Is Affiliate Marketing?  Business 2 Community

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M&A activity leads to revenue and profit growth at Better Collective  iGaming Business

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The 25 Best Affiliate Marketing Companies in 2019  Small Business Trends

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Spared for now, large publishers live in fear of Amazon commission cuts  Digiday

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ViacomCBS Reports Q4 and Full Year 2020 Earnings Results  Business Wire

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ViacomCBS Reports Q4 Results Above Forecasts As Curtain-Raiser To Streaming Showcase  Deadline

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First Ever Affiliate Marketing Guide For Marketers Now Available  Yahoo Finance

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How businesses can use affiliate marketing to boost revenue generation  ZDNet

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