As an affiliate manager the success of your business relies heavily on the commission rates being paid to affiliates and the terms you negotiate with your partners can make or break your program profit.
While some programs offer standard revenue share and CPA commission structures, others may be open to negotiation, offering hybrid or incentivisation deals allowing affiliates to be rewarded based on criteria that you define as their KPI’s
In this article, we’ll explore proven strategies and tips for effectively negotiating better commercials and more favourable terms with your affiliate partners.
1. Build your credibility and value proposition
Before entering any negotiation, it’s crucial to establish your credibility and demonstrate the value you bring to the table. Affiliates are more likely to consider lower commissions for brands that can convert and who consistently drive high-quality offers and incentives across the year and during peak sporting events and seasonal activities.
Start by building a strong portfolio of USP’s that showcases your successful campaigns, and conversion metrics, and any relevant industry expertise or accolades. Additionally, highlight your unique selling points of your products, and define your audience and niche expertise so that your affiliates can tailor their campaigns to match your targets.
Focus on positioning yourself as a valuable partner first. From there, you’ll have a stronger bargaining position when negotiating commission rates.
2. Research and understand industry standards
Knowledge is power in any negotiation, and in the affiliate marketing world, understanding industry standards and competitor benchmarks is essential. Take the time to research commission rates offered by competitors within your niche or industry, as well as the average payouts for various product categories or verticals.
This information will not only help you gauge what constitutes a fair commission rate but also provide you with data-driven leverage during negotiations. If you can demonstrate that your proposed rates align with or exceed other top performing industry brands, you’ll have a stronger case for securing better terms with partners who want to get into your program and promote your brand too.
3. Leverage your performance and audience data
If you’re an established brand with a proven track record, leverage your performance data and audience metrics to help support your affiliates to convert more customers. Transparency is key in this industry and with granular reports and real time data available at your finger tips leveraging this data can seriously provide affiliates with a real edge to promote your product efficiently.
Affiliates are often willing to offer better terms for their traffic to brands that can drive high-quality conversions, and sales promotions because they know that customers will be well looked after and continue to play for a longer tenure.
Present detailed analytics and reports that showcase your website or platform’s traffic volume, engagement rates, conversion metrics, and revenue contributions. Additionally, highlight any relevant audience demographics that align with your target market over time. With Cellxpert’s detailed reporting, other brands have already seen up to a 30% increase in affiliate sign ups due to the level of data our platform provides.
By demonstrating your ability to effectively promote the merchant’s products or services, you’ll be in a stronger position to negotiate more favourable commission rates.
4. Propose performance-based commission structures
In some cases, it may be advantageous to propose a performance-based commission structure rather than supply a standard revenue share or flat rate. For example, why pay a CPA for players who don’t deposit and wager, or differentiate the commission earned by country and player value within the standard incentivisation scheme using Cellxpert’s commission models which can be tailored to suit any number of payment types from hybrids to CPA’s and everything in between!
This approach ties your commission to specific performance metrics or outcomes that you want affiliates to achieve and can be tailored across many different data points, such as sales volume, conversion rates, or customer lifetime value.
For example, you could suggest a tiered commission structure where your rate increases as you achieve higher sales volumes or conversion thresholds. This not only incentivises you to drive better results but also aligns your interests with those of the merchant or network.
Performance-based commission structures can be particularly appealing to merchants, as they protect against risk and ensure they only pay higher commissions when affiliates deliver tangible results.
5. Highlight your promotional strategies and content plan
Affiliates are often more receptive to higher commission requests when affiliates present well-thought-out promotional strategies and content plans, so own your strategy and be clear about how you will help the affiliate to hit their business objectives.
By demonstrating your commitment to effectively promoting your products or services, you’ll be seen as a valuable operator the affiliate will believe is worth investing in.
You may want to develop a detailed promotional plan that outlines:
- What content and media strategies affiliates can leverage
- Provide social media insights that help affiliates target people at the right time and channel
- Send out email marketing initiatives that encourage affiliates to update creatives regularly
- Provide regular updates on any other tactical marketing tactics they can leverage to convert more customers.
Highlight how your marketing approach aligns with the affiliates brand and target audience, and provide examples of successful campaigns you’ve executed in the past with other partners to share learnings and help affiliates keep ahead of the latest trends.
A well-crafted promotional strategy not only showcases your expertise but also reassures the advertiser or network that you know your audience and how you can best leverage it to drive meaningful results.
The Art of successful affiliate negotiation
Securing better commissions in the affiliate marketing landscape requires a strategic approach that combines a solid value proposition, industry knowledge, performance data, creative negotiation tactics, and a commitment to building long-term relationships.
By following the tips outlined in this article, along with having access to industry leading data and tracking solutions such as Cellxpert, you’ll be better equipped to navigate affiliate negotiations with confidence and increase your chances of securing more favourable payment terms.
Successful negotiations are not just about maximising your relationships but also about finding mutually beneficial arrangements that foster long-lasting, productive commercial partnerships. By consistently delivering value, demonstrating your expertise, and approaching negotiations with a collaborative mindset, you can establish yourself as a valuable affiliate partner worth investing in over the long term.
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