If you're like many small, growing web hosting companies, you have a finite and relatively small budget for promoting your company. It should go without saying, however if you're not setting aside some money for marketing already, you need to be investing money in the promotion of your brand every month.
Even if you have a small budget, you can leverage the few marketing dollars you have to garner BIG results by using affiliate marketing. In all the years I've promoted web hosting companies, I've rarely seen an activity that generates as high an ROI as affiliate marketing, simply because you only pay for results. There are some exceptions to that, which we'll discuss, however this is a high leverage activity that can and will help you grow your company.
Affiliate marketing is very simple in principle. Find internet marketers that have web hosting traffic and convince them to promote your brand in exchange for a commission. There are three keys to running a successful affiliate program as a web hosting company: Traffic, Tracking and Transparency.
Traffic
The entire point of your affiliate program is to drive more, targeted traffic to your offers and converting that traffic into new customers. So, your affiliates need to be active and they need to be pushing serious traffic to your site. While you can and should promote your affiliate program online (i.e. in directories, on forums, etc), a great way to find affiliates with a lot of traffic is to search for the same terms that you are targeting in your search marketing campaigns. Find the sites that have top 10 rankings or are using PPC for those terms and ask them to join your program. This approach ensures that the affiliates you are hand selecting for your program have good traffic going to their sites.
This is half the battle; the other half is getting your affiliates to give you prominent placement on their sites. You need to give them a good reason to promote your brand over the dozens of other hosting affiliate programs out there. Offering higher commissions for better placement, more compelling offers and higher conversions are sure fire ways to do this. Keep in mind that the bigger the affiliate is, the better the offer must be. So, be sure to keep a little something extra available for those big affiliates, to entice them to run your offer above others.
Tracking
To pay your affiliates, you need to have a tracking engine tied into your order system, which will accurately credit each affiliate with the sales that they have made. There are many out there, however my favorite is iDev Affiliate. iDev has been around for years, offers a stable backend and a stable of features that can help you manage your affiliates.
Transparency
While your affiliates can see how much traffic they send you and can compare your conversion rates with other affiliate programs they are promoting, the only way they know when they've made a sale on your website is when you tell them. This puts them at a disadvantage, so particular care needs to be taken with running an honest and transparent program. Fraud and cancellations are a part of this industry and your commission payments will need to be adjusted for sales that are later cancelled or determined to be fraud. When this happens, you need to tell your affiliates. Be open with them; tell them how their traffic is performing and why a particular commission might have been rescinded. This kind of open communication will not only keep your affiliates happy, but it will likely drive more sales in the end.
Getting Started
If you're just getting started, go checkout the competition. See what other hosting companies in your niche (i.e. shared, VPS, dedicated) are offering to their affiliates. Run your numbers and put together a thrilling offer for prospective affiliates. Setup your tracking system and determine how you will pay your affiliates and when. When your program is ready to sign up new affiliates, remember the strategies mentioned above and find some heavy hitters to promote your brand.
Even if you have a small budget, you can leverage the few marketing dollars you have to garner BIG results by using affiliate marketing. In all the years I've promoted web hosting companies, I've rarely seen an activity that generates as high an ROI as affiliate marketing, simply because you only pay for results. There are some exceptions to that, which we'll discuss, however this is a high leverage activity that can and will help you grow your company.
Affiliate marketing is very simple in principle. Find internet marketers that have web hosting traffic and convince them to promote your brand in exchange for a commission. There are three keys to running a successful affiliate program as a web hosting company: Traffic, Tracking and Transparency.
Traffic
The entire point of your affiliate program is to drive more, targeted traffic to your offers and converting that traffic into new customers. So, your affiliates need to be active and they need to be pushing serious traffic to your site. While you can and should promote your affiliate program online (i.e. in directories, on forums, etc), a great way to find affiliates with a lot of traffic is to search for the same terms that you are targeting in your search marketing campaigns. Find the sites that have top 10 rankings or are using PPC for those terms and ask them to join your program. This approach ensures that the affiliates you are hand selecting for your program have good traffic going to their sites.
This is half the battle; the other half is getting your affiliates to give you prominent placement on their sites. You need to give them a good reason to promote your brand over the dozens of other hosting affiliate programs out there. Offering higher commissions for better placement, more compelling offers and higher conversions are sure fire ways to do this. Keep in mind that the bigger the affiliate is, the better the offer must be. So, be sure to keep a little something extra available for those big affiliates, to entice them to run your offer above others.
Tracking
To pay your affiliates, you need to have a tracking engine tied into your order system, which will accurately credit each affiliate with the sales that they have made. There are many out there, however my favorite is iDev Affiliate. iDev has been around for years, offers a stable backend and a stable of features that can help you manage your affiliates.
Transparency
While your affiliates can see how much traffic they send you and can compare your conversion rates with other affiliate programs they are promoting, the only way they know when they've made a sale on your website is when you tell them. This puts them at a disadvantage, so particular care needs to be taken with running an honest and transparent program. Fraud and cancellations are a part of this industry and your commission payments will need to be adjusted for sales that are later cancelled or determined to be fraud. When this happens, you need to tell your affiliates. Be open with them; tell them how their traffic is performing and why a particular commission might have been rescinded. This kind of open communication will not only keep your affiliates happy, but it will likely drive more sales in the end.
Getting Started
If you're just getting started, go checkout the competition. See what other hosting companies in your niche (i.e. shared, VPS, dedicated) are offering to their affiliates. Run your numbers and put together a thrilling offer for prospective affiliates. Setup your tracking system and determine how you will pay your affiliates and when. When your program is ready to sign up new affiliates, remember the strategies mentioned above and find some heavy hitters to promote your brand.
Josh Ewin is an analyst for the web hosting industry and manages a well known hosting affiliate program. Mr. Ewin leads the marketing efforts of several premier web hosting destinations and is a regular columnist for webhostingmadness.com.
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