Learn in this lesson everything about your Affiliate Marketing Funnel and how to pinpoint your competitive advantage (or disadvantage) and get more commissions.
Affiliates’ make money on commissions – A click on a Amazon compare chart can turn into a dollar.
Looking for an easy to to use Amazon product comparison chart tool like TableLabs?
- 1 BASICS – The importance of understanding you funnel
- 2 THEORY – Your affiliate marketing funnel
- 3 PRACTICE – Tracking you affiliate marketing funnel and taking data driven decisions
- 3.1 Each stop in the affiliate funnel is a juncture at which your customers can decide if they want to follow along (progress from view to click to commission) or drop out (e.g. view your product compare chart but not click; click but not buy).
- 3.2 Let’s look at an inbound marketing example:
- 3.2.1 The tracking starts in the first stage, market, analyzing relevant searches.
- 3.2.2 After searching for mosquito nets, someone finding your webpage reached the second stage, lead.
- 3.2.3 In third affiliate marketing stage, a lead that clicks on your affiliate link.
- 3.2.4 Lastly, in stage four, the commission (and money) stage, your viewer exited your website by clicking on your referral link and is landing on your affiliate partner like Amazon.
- 4 TABLELABS – Take control over your affiliate marketing funnel
BASICS – The importance of understanding you funnel
In order to setup your business for success, it’s important to understand how your customer flows through your sales process.
A good framework to assess your strategy is the affiliate marketing funnel. Lower than expected commission can have a variety of reasons.
For instance, let’s say your content is absolutely perfect, drives traffic to the website, but your Amazon product comparison table sees only few clicks. Here, low commission are caused by a customer problem (converting views into clicks), rather than a lead problem (getting views), and you would benefit from re-thinking your Call To Action strategy.
Or consider a second example – Your conversion rates from views to click (also called Click through Rate) is extremely high. This indicates that your content is addressing your viewers need very well. To increase your commissions, you should focus on getting more people on your website, as you have a lead rather than a customer problem.
What these two examples demonstrate are two things:
- If you can narrow down where a problem originates, you can take targeted action.
- Narrowing down a problem requires that you track and analyze your affiliate marketing funnel.
Let’s start with understanding the different funnel stages and how they affect your affiliate business.
THEORY – Your affiliate marketing funnel
The affiliate marketing funnel has four stages: First, there is a market, an internet user that has a specific need or just wants to know more about a product. Secondly, content that addresses the interest, converts that market participant to a ‘lead’, bringing him or her to your website. If reading your content drives the viewer to an engagement, a click on your Amazon product comparison table, now the lead has converted to a customer, as your lead followed your recommendation. In the fourth & final stage, clicks can turn into buys, customers are now at your recommended endpoint (like Amazon) and can purchase the product.
Your affiliate marketing funnel is the answer to low commissions and actions you can take.
What are the top four reasons why your affiliate commissions are too low?
- … interested in your content choose a different side (e.g. search keyword is too competitive).
- … views your website, but decides to leave (e.g. content is not addressing the readers need properly).
- … views your website, but does not click (e.g. low Click Through Rate due to less engaging Call To Action).
- … follows your affiliate link, but does not buy (e.g. low Earnings Per Click due to disconnect between content and affiliate product).
Let’s take a deeper look at the corresponding marketing actions.
Important to recognize is that not all sales stages are created equal, as your customer influence is different by stage.
Affiliates can directly influence primarily stages two (Leads), e.g. through their content & three (Customers), e.g. through engaging Call To Action buttons on your product comparison chart.
The first stage, market, it is difficult for you to drive demand for a product. As an example, the number of people searching for the best mosquito net is unlikely to change and can be viewed as fixed.
In the same way, affiliates have little to no authority over the fourth stage, Commission. After guiding your customer to your affiliate program, your partner (e.g. Amazon) controls the user experience and checkout process. If your customers don’t follow through with their purchase, because of technical or any other difficulties, there is little one affiliate can do.
Now – that doesn’t mean that affiliates can take action across all phases. As a former US president famously said, ‘Yes, you can!’.
PRACTICE – Tracking you affiliate marketing funnel and taking data driven decisions
Each stop in the affiliate funnel is a juncture at which your customers can decide if they want to follow along (progress from view to click to commission) or drop out (e.g. view your product compare chart but not click; click but not buy).
To receive a commission, the consumers’ needs to buy the product – views & clicks itself don’t generate revenue. So ideally, ALL of your visitors end up successfully transacting on our recommendations.
But in reality, we don’t see all of our customers following through the way. It’s not even most customers but rather some or few. And this affects an affiliates revenue by a lot.
It’s best to think of your marketing funnel, quite literally, as a leaking virtual funnel, between the market and your wallet. On the bright side, the market continues shoveling money in (= someone searching for recommendations to buy products). The bad thing is, that through the holes in your pipeline (such as visitors not clicking or not buying), money leaks from the pipeline and does not flow into your wallet.
That brings us to the key question – how do I track my affiliate marketing funnel and identify leakage?
Let’s look at an inbound marketing example:
The classic inbound marketing strategy for affiliates is content marketing. Imagine you write a well-researched blog post about the best mosquito net, aiming to drive organic (=unpaid) traffic to your website. Those visitors then hopefully turn into customers and eventually commission.
The tracking starts in the first stage, market, analyzing relevant searches.
For mosquito nets, we want to know how many people are, for instance on google, searching for the keyword ‘best mosquito net’. Also, we want to know how competitive the keyword is (meaning if other websites are also offering similar keywords and articles on mosquito nets). Ideally the number of searches is high and the competition low. Finding that disparity might be rare, but those keywords are gold nuggets.
Low search volumes and competitive keywords limit your ability to generate views. If your commission are too low, you should explore moving to related keywords. For example, instead of ‘mosquito net’, evaluate keywords like ‘insect mesh’ or ‘pest web’.
After searching for mosquito nets, someone finding your webpage reached the second stage, lead.
Our viewer is now on your website, reading through your article. Obviously, more views are for your affiliate links and product comparison table are always better. Putting your number of views in relationship with how many times the keyword has been searched for, is a good way of assessing your SEO competitiveness.
It’s important to emphasize, that you should track views and clicks separately, otherwise you are missing out on key insights. The ratio clicks over views is referred to as Click Through Rate, which shows you how well your content is converting interest (a view) into action (a click).
A low Click Through Rate indicates that there is a disconnect between the viewers intent and your content. In this case, working through your Call To Action will be essential to derive which modifications might yield a better outcome.
From this stage, your affiliate partner controls the further journey of your customer.
If you see low commission despite high clicks on your Amazon product compare table, this means that your customer did not went through with the purchase. One reason could be a disconnect between your recommendation and the information on the affiliate page, e.g. different price points, ratings or product details. Best practice here is to use the affiliate API, rather than manually inputting information in your product comparison tables.
TABLELABS – Take control over your affiliate marketing funnel
Because marketing concepts are often vague, we wanted to enable affiliates to take data driven decisions.
Key to track your affiliate marketing success is the TableLabs Chart Dashboard. It shows your views, clicks & Click through Rate for your Amazon product comparison table.
How to assess your SEO competitiveness with TableLabs?
In the first affiliate marketing funnel stage, use the number of views you received per chart and compare that to the expected searches (e.g. on Google). The number of views for each chart is displayed in the TableLabs Chart Dashboard. To get the number of searches, you can use a keyword analyzer. The ratio views over searches, shows your market share for the respective keyword. For instance, if you have 20 views and the keyword is searched 1000 times, your market share is 2%. (= 20 / 1000).
Not only does this assess past performance, but it also can be applied to evaluate your opportunities for future tables. If you consistently hit a 2% market share, you could estimate the views you could receive for similar keywords.
How many views should a product comparison table have?
In addition to benchmarking your views to searches, comparing the view of your own product comparison tables can help determine which tables might be over- or underperforming. Most of our affiliates offer similar products in one specific niche. Since your search rank might be comparable for similar tables, big differences in product comparison chart views indicate a marketing issue.
Benchmarking your own tables also helps you to test the influence from other marketing campaigns. Comparing the views of one table that you actively influenced, for example you bought keyword ads or mentioned the article in a newsletter or on social media, against a control group (= tables for similar keywords with organic traffic only), shows you the impact of such a campaign.
What is my Click Through Rate and why does it matter?
You should pay attention how the Click Through Rate compares across your Amazon product comparison tables. A lower rate, can indicate, that the content of that particular page is of lower quality or that your Call To Action is less engaging. Along with views, your TableLabs dashboard shows you the number of clicks your generated on each table and the corresponding Click Through Rate.
A great Click through Rate is 20% or higher – that’s what the top 25% charts achieve with TableLabs. The median table likely be far lower than that, at 11%. Note that depending on your content, the rate could be higher (e.g. affordable, urgent-need items).
What my commission tell me about my views and clicks?
To assess the leakage between your affiliate clicks and actual purchases, it’s important to tie back your clicks from your product comparison tables, to your commissions. Your TableLabs chart dashboard has a column EPC (‘Earnings per click’), which you can edit. The Amazon associates earnings report has a commission summary, listing your clicks and earnings. The ratio earnings over clicks yields your EPC. Entering your EPC into your TableLabs dashboard gives you an indication of how much commission you earn with which table. If you market diverse product categories or just want to be more accurate, setup different tracking id’s for different tables. Especially if the product is in a different price or commission rate category, you might prefer a more granular EPC.
Learn more in our tutorial about the use of the TableLabs dashboard and how to create an Amazon product comparison chart.
How do I forecast my commissions?
A simple way to forecast your commission is the product of the number of the overall keyword searches, your market share, your Click Through Rate and your Earnings Per Click of your Amazon product comparison table.
Imagine you write an article on the ‘best mosquito spray’, which has 20,000 searches. Assume you can hold your 2% market share that you have for ‘best mosquito net’, which would yield 400 views (= 20,000 * 2%). If your average Click Through Rate is 10%, the article likely gets around 40 clicks (= 400 * 10%). If your Earnings per Click is $2, you can estimate to earn $80 (= 40 * $2) with your article on mosquito sprays.
Interested in learning more? Check out the Tablelabs features and pricing options
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