How to Set Up an Affiliate Agreement with a Click-Through Program

What is an Affiliate Program?

An affiliate program is an award-benefit program between a business and an affiliate where the affiliate is compensated for bringing new customers the business. The affiliate usually promotes products or services using his or her online presence. There are two type of affiliate programs: Pay-Per-Click and Pay-Per-Purchase.

Pay-Per-Click

A Pay-Per-Click or PPC affiliate program is one in which the affiliate is paid each time a visitor clicks on a link and is redirected to the company’s website. A PPC affiliate program is most appropriate for businesses who want to gain brand awareness and who don’t sell products or services. For example, a news website or a blog would be an excellent candidate to run a PPC affiliate program.

Pay-Per-Purchase

A Pay-Per-Purchase affiliate program is one in which the affiliate is paid each time a visitor buys a product or service from the business after being redirected by a link on the affiliate site. For every product or service purchased, the affiliate gets a percentage of the sale. Most affiliate programs give 10% – 20% of the transaction, but some give up to 50%.

Is an Affiliate Program Right for Your Business?

While an affiliate program is a great marketing tool and can help your business gain additional visitors or sales, an affiliate program is not for every business. If your products or services have a small profit margin, then your company may not be able to afford to give away an extra 10% – 20% of each sale.

Click-Through Affiliate Agreement

The first step to launching an affiliate program would be to set up a legal agreement between your business and its affiliates. An Affiliate Agreement will set out the commission rate and the rules that affiliates must follow. A Click Through Affiliate Agreement is used during the affiliate sign up process on your website. You can find out more about forming an affiliate agreement here.