Before we get into the benefits of two-tier affiliate marketing, let’s discuss what it is. Two-tier affiliate marketing is when your current affiliates refer other affiliates to sign up with your program and then you pay your current affiliate either a one-time flat fee or a percentage of all commissions that the new affiliates they refer earn.
Now that we know what two-tier affiliate marketing is, let’s talk about some of the benefits.
Grow Your Affiliate Program with Current Affiliates
What better way to grow your affiliate program than by having others do it for you? If you have a successful affiliate program and your current affiliates are making great commissions, they will be more likely to refer other affiliates.
Now, some affiliates may see this as referring new competition to their content and affiliate links, but that may not be the case. If you are a merchant who sells products to different niches and customer segmentations, then your current affiliate may want to refer someone who specializes in a different niche and then they can make commissions off of that new affiliate’s commissions.
Grow Your Affiliate Program with Two-Tier Marketers
Some affiliate marketers specialize in two-tier affiliate marketing. For example, a content affiliate who writes about affiliate marketing or a specific industry may create optimized content that focuses on “the best affiliate programs in the widget niche.” This article will include two-tier affiliate links to multiple affiliate programs and this is the focus of that particular affiliate.
Affiliates that do focus on two-tier affiliate marketing tend to be especially keen on promoting two-tier programs that pay residual commissions as opposed to one-time payments.
Incentivize Your Affiliates
By having a two-tier affiliate program setup, you can use it to incentivize your current affiliates to find new affiliates to your program. Offering an increased one-time payment for a set amount of two-tier affiliates referred in a given month is one way to spark the interest of your current affiliates.
As an affiliate of a program, you have an understanding that the merchant is trying to grow their program and that if they have recruited you, they are most likely recruiting others in your niche. Explaining the benefits of earning commissions off of other affiliate’s commissions may influence your current affiliates to begin their own recruitment process of finding new affiliates for your program. If you are going to be recruiting these new affiliates anyway, why wouldn’t the affiliate want to try and earn commissions?
Get Listed on Affiliate Directories
Affiliate directories do not tend to drive direct sales as an affiliate, but they love two-tier affiliate programs. Why? Well, they can create lists and mentions of affiliate programs in their directories that are highly visited by active affiliates looking for new programs to promote.
As a merchant, if you are working with an outsourced affiliate program management agency, or a dedicated affiliate manager with existing relationships with said directories, then they may be able to negotiate much better placement within these affiliate directories.
Two-tier affiliate marketing is simple as its core, but can become very intricate if the proper tracking is not set up. It is important to ensure that whichever affiliate network you are using, that they can handle a two-tier affiliate structure.
If you have any questions on two-tier affiliate marketing, please contact us.