Starting your own WooCommerce powered online shop is one of the easiest things you can do nowadays. You can choose from a variety of hosting solutions, then just one-click to install WordPress and WooCommerce and, in less than an hour you can have your shop up and running. It's that easy.
But then, the hard part begins: reaching potential customers and making sales.
We’re sure this is a daunting thought if you're just starting out. But, please remember this: the same way others have built product empires, you can do too.
You just need to put pen to paper and see what options you have for promoting your shop, then decide which makes the most sense for you, both from a financial and a brand image standpoint.
Today we're going to dive into one particular growth strategy: affiliate marketing. More specifically, we'll be looking at the pros and cons of running your own affiliate program and at ways you can set one up for your WooCommerce shop.
Benefits and Drawbacks of an Affiliate Program
Before we jump into the technicalities of setting up your own affiliate program, let's see what affiliate marketing is and why it can be a viable solution for growing your store.
In essence, the concept of affiliate marketing is pretty simple. Think of it like this:
- You, as a shop owner, partner with people that already have an audience (affiliates) through an affiliate program.
- Affiliates promote your products and send potential customers to your website.
- If one of these potential customers makes a purchase, you share the profits from the sale with the affiliate that referred the new customer.
This is where the first benefit of affiliate marketing becomes apparent:
Affiliate Marketing Is Performance Based
You pay only for results. You pay only when a referred visitor makes a purchase.
Contrast this with traditional pay-per-click advertising where each and every visitor that reaches your website through an ad campaign costs you money. Because visits don't equate to sales, if your ad campaign doesn't reach the right people, you can end up spending more than you're making.
On the other hand, with affiliate marketing, your budgets will not be affected by ineffective promotional campaigns. If your affiliate partners send you low quality visitors that don't end up converting into paying customers, you won't need to pay for these visits.
Affiliate Marketing Grows Your Audience and Brand Awareness
One of the beautiful things about affiliate marketing is that it opens you up to your affiliate's audiences. This is especially powerful when you're starting out and you don't yet have an audience of your own.
However, it's important you know that this can be a double-edged sword. If you partner with affiliates that don't represent your niche, you may not have the results you’re looking for. You don't just want to put your products in front of any group of people. You want to put your products in front of the right group, in front of people that are interested in products like yours.
This is why it's better to partner with affiliates that activate in your niche. By doing this, you'll be speaking to people that are interested in the types of products you’re offering, which greatly increases your chances of making sales.
But be careful not to niche down too much.
As a quick example, if you're crafting ceramic vases, you're not speaking only to people looking to buy ceramic vases. You're speaking to people looking to remodel, you're speaking to interior designers, you're speaking to people that want to buy a special present, and so on.
Make sure you partner with affiliates that represent the different groups of people you want to reach. Because, this is how you also create brand awareness.
Chances are that certain people are part of several of these groups. When these people see your products in different places, your brand exposure grows, people begin to notice you and a sense of curiosity starts to build.
These people are far more likely to visit your website, to learn more about you and, ultimately, to purchase from you.
Performance Is Easy to Track
If you're using proper tools to power your affiliate program, you have access to detailed statistics on the performance of your program. With most other advertising channels, the success of your efforts isn't always clear and tracking down potential issues, so you can improve your campaigns, is not particularly easy.
However, with affiliate marketing you can track multiple metrics that offer you a great overview of how your program is performing. For instance, you can analyze:
- how many visitors your affiliates send to your website
- from what websites these visitors are coming from and on what pages they are landing on
- how many of these visitors convert into customers
- who are your most active and most inactive affiliates
- which products sell the most and what's the total value in sales your affiliates generate for you
With all of this information at your disposal you can not only pin-point what works, but also effectively strategize on how to improve your affiliate program.
An Affiliate Program Needs to Be Nurtured
Running an affiliate program can be time-consuming. Especially in the beginning.
Choosing the right software will help you streamline your processes and will save you time and headaches, but, at the end of the day, your affiliate program's success depends on the relationships you build with affiliates and also on the ability of your affiliates to represent your brand.
Setting up an affiliate program has become easy. You'll see how easy in a few moments.
However, your time and energy will be spent primarily on:
- analyzing the work of potential affiliates to see if they would be a great fit for your brand;
- connecting with these potential affiliates and trying to establish a business relationship with them;
- discussing and building campaigns with the affiliates you manage to onboard;
- analyzing reports and creating new strategies based on the collected data.
Remember: an affiliate program is about relationships. The better your relationships, the more success you're likely to have.
How to Start an Affiliate Program
Now that you have an overview of what the benefits and drawbacks of running an affiliate program are, let’s dive into setting one up for your WooCommerce store.
For this, we’ll be using SliceWP, a native WordPress plugin that lets you manage your own program straight from your website’s dashboard.
There are quite a few WordPress plugins that you can use to integrate with your WooCommerce store. However, when it comes to ease-of-use and features, few can outperform SliceWP.
Furthermore, you can start your affiliate program without any risks, because SliceWP comes with a core version that is not only free, but also has all of the features you need, including:
- setting a custom cookie duration,
- a custom commission rate,
- email notifications
- and an affiliate area.
SliceWP is hosted on WordPress’ official plugins repository, which makes it easy for you to install it directly from your website’s dashboard. Here’s how:
- Firstly, navigate to your WordPress dashboard > Plugins > Add New.
- Then, in the “Search plugins” field, type “slicewp” and wait for the results to show up.
- Once SliceWP is displayed, click the “Install Now” button.
- Lastly, click the “Activate” button once the plugin has finished installing.
Right after you activate SliceWP, a setup wizard will appear, which will guide you through some of the basic settings. However, for this particular article, we’ll be skipping the wizard and we’ll be setting up these options separately, while also discussing their importance.
Setting up the Basics
Enabling the WooCommerce Integration
By default, SliceWP integrates with several eCommerce WordPress plugins. Because you’re using WooCommerce to power your store, we’ll firstly need to activate this particular integration to have everything working properly.
- Navigate to SliceWP > Settings > Integrations (tab).
- Turn on the switch next to WooCommerce and save the settings.
That’s it. This was an easy one. Let’s carry on with something a bit more complex.
Cookie Duration: What Is It?
Before we jump into setting up the cookie duration, let's firstly see what this cookie actually is. Simply put, a cookie is a small piece of information the browser stores for a limited amount of time.
With the help of this information, affiliate software, such as SliceWP, can track the sales made by referred users in order to reward the affiliates that sent the users your way.
But, because the cookie is only stored for a limited amount of time, affiliates can earn a commission only if potential customers purchase before the cookie is deleted.
For example, let's say you, as a shop owner, decide to set the lifespan of a cookie to 30 days (this lifespan is commonly known as the cookie duration). Once a visitor reaches your website through an affiliate's link, the cookie is created, but it's set to be deleted in 30 days.
If this referred visitor makes a purchase within those 30 days, the affiliate that referred the visitor will be rewarded a commission. However, if the visitor purchases after 40 days, the cookie will no longer be available and the affiliate will not be granted the commission.
This is why the cookie duration is important. You should think carefully on what cookie lifespan you'll offer affiliates.
The industry standard has been 30 days for quite some time now. However, if you want to make your affiliate program more attractive to potential affiliates, we recommend you to go with a higher value. 45, 60 or 120 days are good options for the cookie duration.
Cookie Duration: How to Set It Up
Now that you know what a cookie is and how it works, let’s set it up:
- Navigate to your WordPress dashboard > SliceWP > Settings > General (tab) > General Settings (section).
- Set the cookie duration to the desired value, as shown in the screenshot, and then save the settings.
Commission Rate: How to Calculate It
The next important aspect is the commission rate you're willing to offer your affiliates. Important is an understatement here. It's crucial that you take your time to calculate the value of affiliate commissions.
For once, your offer needs to be attractive for potential partners. As you can imagine, few people would join a program that pays low commissions.
You also need to take into account that these commissions are business costs. Similar to production, packaging and delivery costs, affiliate commissions need to be factored into your pricing strategy. If you set your pricing too low, your profits may end up suffering. We'd love to be able to say “offer your affiliates 30% and everything will work like magic”, but we can't. There isn't a universally valid number here. You need to put pen to paper and see what works for you. If you're not sure where to start, here's what you can do:
- Look at what your competitors are doing. Chances are some of your competitors are already running an affiliate program. Check their offering. If they have a 20% commission rate, consider this a starting point. To be competitive and attract affiliates you'll want to go with a higher rate than the average in your industry.
- Think of affiliate commissions like any other cost. Before you add another 10% over what your competition offers, take a moment to analyze your overall costs and pricing. Make sure you can either safely lower your profit margins or increase your prices to accommodate this new expense.
- Analyze your customer lifetime value. Let's say you’re considering a commission rate of 25%. At first glance, you may be thinking that affiliate payouts will account for 25% of your product's price. This will most probably not be the case. If you have returning customers, the cost of affiliate marketing goes down. Chances are that once a customer knows about you, they'll be returning to your shop directly and not through an affiliate's link. For you this is great news, as you'll mostly be doing affiliate payouts only for a customer's first purchase. If a referred customer purchases 5 times from you at the same price, your affiliate commissions will not account for 25% of the total value, but rather 5%.
Commission Rate: How to Set It Up
Now that you have a better understanding on how to calculate your commission rate, let’s see how you can set it up in SliceWP:
- Firstly, navigate to your WordPress dashboard > SliceWP > Settings > General (tab) > Commissions Settings (section).
- Then, select the commission type and set the percentage or amount value you wish to reward your affiliates, as shown in this image:
Affiliate Area: Why It’s Important
Want to know what's one of the worst things that can happen to your affiliate program? It's affiliates abandoning it because they're having a bad experience while on your site. Yes, this happens.
If it’s difficult for affiliates to figure out where they need to click to grab their promotional link, where to find the creatives they can use or where to view their statistics, their experience will be affected in a negative way.
Think about it from your affiliates' standpoint. Most of them promote several products and adapt their strategies based on data, meaning they switch from one product's dashboard to the other regularly and interact heavily with the interfaces they encounter.
You should make your affiliates' life as easy as possible. Having a clean interface, with reports to help them understand how their efforts are performing, is an opportunity for you to help your affiliates succeed.
Affiliate Area: How to Set It Up
To make your affiliates’ experience as smooth as possible, we’ll be setting up three distinct pages that are interconnected to one another.
The Landing Page for Potential Affiliates
This is the page you want potential affiliates to see first. It should outline the benefits they have if they join your program. The goal with it is to answer the big question: “why should I join your program?”.
The page should include the basics, such as the cookie duration and the commission rates, but also any other incentive you are willing to offer.
To set up this page, let’s:
- Create it from your website’s administrator dashboard > Pages > Add New.
- Set a title for the page, let’s say “Become an affiliate”, and fill in the content with the affiliate benefits.
- Lastly, publish it.
Ideally, right after the benefits, you want to have a call to action that will redirect users to the next page of the affiliate area.
The Affiliate Registration Page
The goal of this page is to offer a straightforward way for affiliates to join your program. No more, no less. For this purpose, it will only contain a simple registration form.
Let’s set this page up:
- Firstly, create it from your dashboard > Pages > Add New.
- Then, set a title for it, let’s say “Affiliate registration”.
- For the content, add just one Shortcode block, and in it, add the following shortcode: [slicewp_affiliate_registration].
4. Lastly, publish the page.
We know the shortcode doesn’t look like much in the page’s edit screen, however, if you visit the actual page you’ll be greeted by a complete registration form that your potential affiliates can use to register for an account.
Below you can see how the form looks with our MH Theme. Please take note that on your website the form will look slightly different because it takes its styling from the active theme.
The Affiliate Account Page
Now that you have a page promoting your affiliate program and one where users can register for an account, let’s set up the page that affiliates will use the most: their dashboard.
Similar to the registration page, we’ll just add a simple shortcode to a new page and let SliceWP do the rest. To set the affiliate account:
- Firstly, create the page from your dashboard > Pages > Add New.
- Set the title, as you’ve done for the other two pages.
- For the content, add a Shortcode block, and in it, add the following shortcode: [slicewp_affiliate_account].
- Lastly, publish the page.
Within their account, affiliates can:
- quickly copy their promotional link,
- view their overall statistics,
- see the visits and commissions they generated,
- check the payouts they received
- and update their profile.
Here’s how the account looks on our MH Theme. As with the registration form, this page will look slightly different in your case.
Setting up Advanced Affiliate Strategies
With all of the basic settings set up, your affiliate program is ready to go. You can recruit affiliates, automatically track referred visitors and reward commissions when these visitors make a sale.
Now let’s talk about a couple more advanced options that you can use to generate more sales and attract affiliates more easily.
Affiliates Coupons: What They Are
In essence, an affiliate coupon is a regular coupon that is tied to one of your affiliates. This means that each time the coupon is used in a successful sale, the affiliate that is connected to the coupon will be rewarded a commission.
You might have already seen this type of marketing before. Have you ever noticed an influencer or a public person that you follow, whether it’s on Instagram or YouTube, offering an X percent coupon code? That’s an affiliate coupon code.
Every time that code is used, the influencer (affiliate) receives a commission for the referred sale.
This particular tactic is beneficial for everyone involved in the transaction:
- For you: The direct benefit is that you generate more sales. Besides this, you have accurate data on the number of times the coupon code was used and how much revenue was generated by its use. Knowing this information, makes it clear how successful an affiliate coupon code campaign was and which affiliates were able to drive considerable sales through this type of campaign.
- For your affiliates: Because your affiliates receive a commission each time the coupon is used, they no longer need to worry if users click on their promotional link or not. With this peace of mind, they can focus on promoting your coupon campaign knowing they will be rewarded regardless of the way users reach your shop.
- For your customers: They benefit from a discounted price for a product they were looking to purchase.
Affiliates Coupons: How to Set Them Up
Now that you have a clear understanding of what an affiliate coupon is and how it can help you generate more sales, let’s set one up.
- Download and install the Affiliate Coupons add-on for SliceWP.
- From your website dashboard’s sidebar menu, click on Marketing > Coupons. Then, click on the “Add coupon” button at the top of the page.
- Set the data for your new coupon the same way you’ve done for previous coupons.
- Before publishing the coupon, look in the “General” tab of the “Coupon data” box for the “Affiliate Name” field. Here, start typing the name or email of the affiliate you want to connect to this coupon code. A drop-down with affiliates matching your search query will show up. Click on the affiliate you were searching for to confirm the selection.
5. Lastly, publish the coupon code.
Now that you have the code, you can share it with your affiliate and start the coupon campaign.
Lifetime Commissions: What They Are
One of the challenges you’re going to face when starting your affiliate program is attracting your first affiliates.
Luckily, there are a few strategies you can apply right away to influence potential affiliates to join your program. One of these is to offer commissions for subsequent sales made by referred customers.
Affiliates are used to receiving commissions for the first sale. That’s somewhat the industry norm. However, not that many affiliates benefit from future sales made by the customers they referred.
This is where you can stand out from the crowd. If you’re generous with your partners, they will be drawn to work with you instead of your competitors.
We know what you may be thinking right now: “offering 20, 30, 40 percent to affiliates from every sale is madness”. And we agree with you.
Being too generous can be detrimental to your business if you’re not aware of your costs. In all fairness, this particular strategy is extremely aggressive, and it may not work for everyone. However, you can adapt and refine it to serve you well. For example:
- You can set a smaller commission rate for subsequent orders.
- You can limit the timeframe in which subsequent orders will generate a commission.
- You can limit and fine-tune this strategy only for a few key affiliates.
All of the above refinements can differentiate you from your competitors and offer you an edge when it comes to promoting your affiliate program. Whichever you choose, just make sure it works in correlation to your pricing strategy.
Lifetime Commissions: How to Set Them Up
Now that you know what lifetime commissions are about, let’s set them up for your WooCommerce shop. We’ll cover two scenarios, one where you enable the functionality for all affiliates and one where you enable it just for particular affiliates.
For both options, you’ll need the Lifetime commissions add-on for SliceWP. This add-on powers all the functionality needed to reward affiliates for future purchases, so before we move forward, download and install it on your website.
Lifetime Commissions for All Affiliates
With the add-on up and running:
- Navigate to SliceWP > Settings > General (tab) > Lifetime Commissions (section). Here, turn on the “Enable Sitewide” switch.
2. Then, select the “Lifetime Sale Rate” commission type and set the percentage or amount value you wish to reward your affiliates for future orders.
3. Optionally, if you wish to limit the reward period, set the “Lifetime Duration” option to “Limited” and set the number of days you wish the period to last in the “Lifetime Limit” option.
That’s it. From now on, after your affiliates make their initial referred sale, they will also be rewarded for future sales made by the customers they refer.
Lifetime Commissions for Individual Affiliates
If you wish to offer this type of commissions only to certain affiliates:
- Firstly, navigate to SliceWP > Settings > General (tab) > Lifetime Commissions (section). Here, turn off the “Enable Sitewide” switch. This way, lifetime commissions are disabled globally for all affiliates.
2. Then, navigate to SliceWP > Affiliates and click to edit the affiliate you wish to benefit from lifetime commissions. Once in the affiliate edit page, scroll down until you reach the “Lifetime Commissions” section.
3. Here, set the “Lifetime Commissions” option to “Custom”.
4. Then, set the “Lifetime Sale Rate” option, to either percentage or fixed amount, and the value for commission rate.
5. Optionally, if you wish to limit the reward period for this affiliate, set the “Lifetime Duration” option to “Limited” and set the number of days you wish the period to last in the “Lifetime Limit” option.
As you can already tell, there are multiple ways you can take advantage of an affiliate program. Running one for your WooCommerce store is a great way for you to reach new customers and increase sales.
Besides generating more revenue for your business, you’re also building partnerships that you can leverage for other opportunities. Furthermore, with great software, such as SliceWP, you’ll be able to quickly set up your own affiliate program and manage it directly from your WordPress dashboard.