Part 7:
How To Improve The Results From Your Affiliate Program...By Focusing On Their Results

"The traffic banners generate is laughable compared with what we're seeing with affiliates; they outperform banner campaigns by a factor of 10."

IN THIS ISSUE

For the past few issues, we have addressed your issues as the owner of an affiliate network. Now I invite you to stop looking at your point of view, and walk in the shoes of your affiliates. The following article shows you how to effectively merchandise for your affiliate program, told from the point of view of the affiliate.

1. Remember the Formula

2. 12 Principles Of Online Retailing

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1. In any new medium, what is "new" is most threatening. As Mark Twain once wrote, "it's not the progress I mind, it's the change I hate." Getting people to use the Internet to buy products is a new behavior, a change. If you offer customers products from companies they do not recognize, it will undermine sales. A friend of mine calls this the "Know Ya, Love Ya, Trust Ya" mentality!
   
   
2. If you are offering your own products, without a recognized brand name, then first introduce your customers to related products from recognized brand names. Consider this like your tie from the Men's Wearhouse example above; you are giving them something familiar, and then following up with your own suit, your own product. The initial brand name creates comfort, and your product is then packaged with the brand name.
   
   
3. Brand names from familiar companies are essential to developing trust, credibility, and sales. Creating a new brand without using recognized brand names is an unnecessary effort. If you merge the power of recognition with your own product line, you can generate more revenue by first offering the brand name product, and up selling them to your product. Or if you are simply offering other's products through your own store, then be sure to introduce them to brand names they recognize and trust.
   

1. Web designers call these entry, or doorway, pages. This tested, proven process gives your customer focus. If they do not like the product you are offering, or if they need some time to think, invite them to leave you a message (more on this in Principle 7). If they do like it, they will buy immediately.
   
   
2. Remember that studies have shown consumers like to spend between $29 and $39 on an initial purchase. This is a low enough price point where they do not feel at risk, but not too cheap where they feel the product is not worth shipping.
   
   
3. In fact, this is one of the real secrets of online pricing. If you price the products below $20 (with the current exceptions being books and music CD's), you are likely undermining your sales. Shipping costs are usually about $3, which is 15% of a $20 purchase. In essence you are telling the customer to buy from you and add on 15% for buying on the Internet. That is really not the appeal of this new medium, is it?
   
   
4. Now of course you can pay for shipping, but then you cut into your own profit margins. If you focus on one product between $29 and $39, then shipping becomes less apparent, less than 10% of the sale. Psychologically, this adds up for your customers, and for you. The lesson is simple; focus, focus, focus your customer. Give them a good lead item and guide them through your sales process.
   

1. Remember your first time, the first time you bought something on the Internet? Back then, it may have been confusing to you. You may have wondered about entering your credit card into an empty form. Who got this order, and who would fulfill it? Eliminate this confusion immediately by giving them a quick way to buy.
   
   
2. Be sure that your buying process involves as few clicks as possible. Amazon become legendary for its 1 Click Shopping, where you can simply click a button and immediately purchase the product. While you likely cannot be Amazon just yet, you can learn from their example.
   
   
3. What you are really doing on the Internet is creating the customer's buying behavior, so keep it familiar. Limit your use of color to one or two colors on your Web Page. People will be drawn to the subtle use of color; this is a good place to put your specials and your call to action, your call to get them to buy.
   
   
4. An alternative is to use an ugly, garish background color and then use a white background on your page where your product lies. The customer will be turned off by the ugly background, that is hard on the eyes, and look to rest on the white space. This is an effective technique to get them to focus.
   
   
5. Give them a specific product page, and lead them directly to an order page. Do not separate your content into too many Web Pages. For example, if you are selling that tie for Men's Wearhouse, give them a picture of the tie, a short description, and then put extra information on the bottom of your Web Page. On the first screen they see, let them click to order.
   
   
6. On your order page, include up sells to more expensive products. Tests have shown that this is the best place to put extra items in your Web Site, or shopping cart. For example, on the tie order page you could include an upsell to a new shirt, or a jacket. Even better, let them just order the tie, process the order, then on the thank you page after they order, upsell them to related products. This is as simple as putting a new link on your "Thank you for ordering page." Look around the Internet and see how few people are putting this tested process into action. What better place to get people to purchase then when they have already used their credit card? This is truly the cash register, the impulse buy, the place where additional sales are available.
   

1. Read magazines and industry reports on what products are the most popular. Trends are spotted months in advance; for example, most retailers plan for Christmas in July.
   
   
2. You have to think ahead, instead of reacting to the moment. This is called proactive marketing, as opposed to reactive marketing. If you try to react to the market, it will pass you by. Anticipating what will be in high demand is not that hard; just plan 2-3 months ahead to make sure you can select the right products.
   
   
3. Do a little research. Go to sites like CNET and Outpost.com if you sell computers. They often list their best sellers. Amazon does the same thing. With a little footwork, you can find the products that are pulling and see if you can offer them through your own storefront.
   
   
4. Research financial journals like the Wall Street Journal, Red Herring, and Forbes. These journals are based not on reading current sales, but projecting what will happen to a company in the upcoming three months. For example, an August article on the Pokemon (those are popular toys, a series of them) phenomenon led to two companies stock having a dramatic increase, because it was shown that demand for these toys would be high in Christmas. By November, these stocks had begun descending, because the Pokemon effect was over. Financial journals give you the best foresight on industries, because they are written for people investing in the companies, not just for those selling products.
   

1. Consumers buy products based on the four seasons. For example, flowers are most popular on Valentine's Day and Mother's Day; the industry sells most of its products then. Offer flowers during the Winter and Spring months, but not the Fall or Summer. An exception is if your Web Site is focused on life events, like a reminder service for people to remember birthdays and anniversaries. Life events are an exception to this rule, but in general consumers follow a seasonal buying behavior. Bank on it.
   
   
2. Remember that 70% of retail items - all those Beanie Babies and toys and shirts and ties - are sold during the Christmas holiday season. The Internet's biggest seasons for shopping center around holidays.
   
   
3. The Christmas holiday is the biggest opportunity to sell products. You should focus most of your energies on this season, beginning in at least September. Select the right products to match to the season. The other two biggest shopping holidays on the Internet are Mother's Day and Valentine's Day.
   
   
4. If you are going to take a vacation, take it in August. Sales on the Internet descend during August, when people are going outside and going on vacation. Also keep an eye on the weather; one winter snow storm in New York resulted in a huge influx of sales for online retailers, because people could not go outside. That is why Winter is an excellent season to focus on.
   
   
5. Be sure that you read catalogs and start understanding the seasonal buying behavior of people. This way you can change the products you offer. Think of it this way; do you want to be the guy selling Christmas trees in July, or selling bikinis and sunscreen? Keep your focus on the ultimate prize and don't get lulled by the ability to offer everything to everyone all the time. Specific products, sold to specific markets, targeted to specific seasons lead to the most sales.
   

1. Now think of your customer at home or at work; the dog is barking, or the boss is growling. People are moving about, and there are many tasks to fulfill. The first visit to your site is the first contact. Many things will interrupt them; bank on this and use an email form to give them some form of reward for contacting you.
   
   
2. Automate your follow up using Aweber.com's sequenced, automated response tool. Write 5-7 messages for your customers, and set your follow up sequence for the first month. After that, put all customers who opt in to your list on your normal email newsletter or information list, and ask for their permission to do so. You will be amazed at how many people will opt in, as long as you ask for their permission. In my own tests, 80% of my customers opt in to my list.
   
   
3. For example, the first message sent immediately gives them a gift certificate that can be redeemed. The second email, sent 3 days later, thanks them for contacting and checks in to invite the customer to revisit the Web Site or give you a phone call. Four days later another email is sent, adding a new offer to the original sale and setting a time limit on acting. Seven days later comes the fourth email, once again reminding them that the limited offer is about to expire. Finally a fifth email thanks them for contacting the Web Site and invites them back to look at related products.
   
   
4. Most people will buy on third contact, the third email, but be sure to give them the ability to opt out of your email list at any time. This can be automated through Aweber.com, so that they can click and remove themselves. Do not email people who ask to be removed; it will only damage you and bother them. After all, you want to offer products to people who are interested, right?
   
   
5. Be sure to use the personalization features of Aweber.com and other automated response systems. Put your customer's name in the Subject Line of the email; this is an easy task that is automated by Aweber. Most people will open an email with their name on it; insert their name into the "Dear Friend" line and you convert an automated email message into a personal invitation.
   
   
6. Do not begin your letters with qualifications about how this is not spam (email that is sent without the customer's permission), or how this is not a rip off. In your customer's mind, they are immediately led to a negative view of what you offer. If you are emailing someone who does not like being emailed at all, your message will fall on deaf ears. They don't care what you write. And for those who want your email, they will wonder why you are introducing them with this warning.
   
   
7. Your headline and your first sentence will determine your success. Spend all your time on writing a good headline and getting your customer to focus on the first sentence. Also use your P.S. to offer gift certificates, specials, and to set time limits to what you are offering. It is all about getting people to act; to do this, you have to ask them to take an action.
   
   
8. Finally, remember not to over sell people on early contact. Your early messages should be a mixture of sales and content, or value added offers. Don't push products down people's throats, or try to intimidate them. The goal is to get them to keep in touch with you and after having your good offer repeated to them during a specific sequence, get them to make the purchase.
   

1. Selling products based on price puts the burden on you to generate a high volume of sales. This is the oldest con in the book, making up in volume for what you lack in margin. If you are WalMart, you can get away with this. But on the Internet, keep an eye on your margin.
   
   
2. Make sure that the products you are offering can be delivered. It has be shown that customers online will pay a higher price if the product can be delivered immediately. For example, Amazon does not have the lowest book prices. But people buy there because many of these books are shipped immediately, and then pay a bit extra for this privilege. This is an added value to the purchase, the ability to ship immediately.
   
   
3. Add coupons, specials, and gift certificates to what you offer. This is a way to generate the initial email inquiry, so you can follow up with your automated email system. The best motivation is to get more than what you pay for.
   
   
4. For example, ActiveMarketplace offered the WipeOut CD Repair cleaner. Using the principles outlined above, we offered this $14.99 product along with a free subscription to a magazine. The free subscription was offered from Enews.com's affiliate program, so we signed up as an affiliate to add this to our WipeOut offer. This gives us the ability to offer Rolling Stone magazine to music fans, Sports Illustrated to sports fans, Country Music magazine to the country music fans, etc. The recognized brand name of the magazine, and the added bonus value of the free subscription, enhanced the relatively unknown WipeOut CD Repair Cleaner.
   
   
5. Eventually we found distributors in retail stores who bought thousands of units because of the credibility of the offer. While we were targeting customers online, we found that retailers understood the value of this product and would buy them in the thousands. Make sure that you remember you are targeting both consumers and retailers looking to buy in bulk. This way you can take advantage of two markets, simply through inviting them to get more than what they pay for.
   
   
6. It is better to spend $15 and get a $50 value, than to discount a $15 item to $10. Think about it; in the first case, you get more value for your dollar. In the second case, you basically tell the customer that the retail price is a lie, and that they should never buy at the retail price. You are also killing your own margins, when you could be adding value and preserving your margins.
   

1. Put your phone and customer service number on every page, and be sure you can answer during business hours.
   
   
2. Follow up purchases with a phone call to thank your customer for ordering as well. A thank you will go a long way to creating repeat buys and to decreasing returns. Once again, keep it familiar and personal.
   
   
3. Add the personal touch of a follow up phone call to an order, you not only reassure the customer after they bought, you can eliminate buyer's remorse. Most people think they have made a mistake after buying something...it is simply human nature. Spending money is a sign of trust. Imagine when a company calls to make sure everything went smoothly for the customer. Not only do you diminish buyer's remorse, you improve your credibility and trust from the customer. Repeat purchases come from customers who trust and like doing business with you.
   

1. We found that selling accessories to computers - things like toner cartridges for laser writers, mouse pads, special keyboards, fancy mouse and drawing tools, etc. - gave much higher margins than the computers we were selling. This is a fact of life for many products, from automobiles to computers. The real margins lay in the accessories, when people are less cost conscious than they are when buying the computer. Be sure to think about the accessories for the higher ticket items.
   
   
2. Margins for popular products get reduced by competition. Yet there is rarely a reduction in price for accessories. After all, when is the last time you saw someone do a blowout sale for a computer keyboard? If the person needs the keyboard, they will pay full price, and you will earn much higher margins for items like this, rather than the high ticket items like the computer (NOTE: Computer hardware often has less than 5% margins, while a keyboard can yield 10%, and more.)
   
   
3. For example, if you are selling Palm Pilots, you will find many consumers interested in buying them. There is high demand. But many people will buy Palm Pilots from recognized computer superstores, like Outpost.com. You will likely find a tremendous amount of competition for that product at other Web Sites.
   
   
4. Instead of selling the Palm Pilot, why not sell the accessories to the Palm Pilot? You could then contact all current owners of Palm Pilots and offer the new keyboards, the memory upgrades, and the modems. These will give you better margins than selling the Palm Pilot, and it is likely you can tap into any owner of a Palm Pilot. You then develop a list of Palm Pilot owners to sell the next upgrade; it's called selling them the accessory and building loyalty by helping them use the tool. Then when they want to upgrade the tool, you are the person they are in contact with.
   

Peace,

Declan

P.S. Be sure to check out how the latest, personalized training system that shows affiliates new techniques for increasing sales. at Right on the Money; "Drop Me Off On The Internet With Nothing But Dial-Up Access And I Can Make Money in 5 Hours (Discover How You Can Too). Recommended.

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