What Is A Two-Tier Affiliate Program?
What Is A Two-Tier Affiliate Program?
A two-tier affiliate program follows a two-tier payment structure whereby affiliate marketers not only receive commissions on the sales they generate but also on sales generated by the other marketers they refer to the affiliate program. If you sign up for a two-tier affiliate program, you will not only receive commissions on your own referrals, but also on the referral sales triggered by other affiliate marketers whom you brought into the same program as fellow affiliate partners.
How Does A Two-Tier Affiliate Program Work?
A two-tier affiliate program comes with a two-tier payment structure. It’s just as simple as that.
In a two-tier payment structure, the first tier of affiliate commission is just the same as regular affiliate programs.
Here’s a Beginner’s Guide On How Affiliate Programs Work to help you understand exactly how affiliate marketers fit in the entire affiliate marketing ecosystem and when and how they can earn commissions.
However, the additional tier makes all the difference, where affiliate marketers earn a commission every time the affiliate marketers referred by them to the affiliate program generate sales.
Typically, a two-tier affiliate payment structure would look like this:
- First Tier – 50% commission on referral sales generated directly by you (i.e. buyers followed your affiliate links and made a purchase).
- Second Tier – 10% commissions on referral sales generated by your sub-affiliates (i.e. buyers followed the affiliate links placed by the affiliate marketers whom you referred to the program and made a purchase)
There are three-tier and four-tier affiliate programs too, but those are very, VERY few in numbers.
How Can You Make Money With Two-Tier Affiliate Marketing?
In two-tier affiliate marketing, you basically have to target two groups of people to multiply your earnings – the buyers or end-users, whom you should promote the products to, and the affiliate marketers, to whom you should promote the affiliate program, and not the product you are promoting on your website or blog.
Therefore, you should be very careful while devising your strategies for achieving two-tier affiliate marketing success. Here are a few effective strategies to make money with two-tier affiliate programs.
Target Groups Of Bloggers And Social Groups
If you are already a member of LinkedIn groups, Facebook groups, and other social groups that comprise affiliate marketers like YOU, post a recruitment link for the two-tier affiliate program you are already registered with and do this repeatedly. Of course, you should not spam.
While posting recruitment links, don’t forget to include a screenshot of the money you have earned in the first-tier.
Talk about the program itself and also highlight the unique selling propositions of the product you are promoting.
This will attract a whole lot of people to the program and the brand you are promoting. If they are approved and join as your sub-affiliates, you can gradually start earning second-tier commissions.
Build An Email List
It’s always a great idea to grow your email list. If you are already an authority in your niche (example: pet toys), chances are there that you already have contractors, business owners, bloggers, affiliate marketers, and suppliers on your list. It’s very likely that these people also have channels to reach out to relevant buyers.
Sending a newsletter at regular intervals is a great way to rope in these people as your sub-affiliates and to grow your affiliate business with time.
Remember that your newsletter should contain information about the product and the program as well.
Optimize The Affiliate Program On Google
You can also optimize your blog or website on Google for specific and possibly long-tail keywords. Remember that there are affiliate marketers who are almost always looking to join programs that fall in their niche.
For example, within the ‘Pet‘ affiliate marketing vertical, there are scores of niches.
There can be numerous niches within an affiliate marketing vertical. Read more about verticals.
Someone might be interested in promoting natural dog food products, whereas some other affiliate might be looking for cat food dispensers to promote.
If you can rank your website on Google for keywords like ‘dog food product affiliate programs’ or ‘cat food dispenser affiliate programs’, you can possibly reach out to a smaller sub-group of affiliate marketers who might be specifically interested in the niches you are talking about.
This way, you can soon build your team of sub-affiliates and start earning both from your referrals and from theirs.
Two-Tier Affiliate Programs – What’s The Catch?
Although two-tier affiliate programs might seem lucrative, let’s not forget that it’s sales that keep an affiliate system alive. No matter how many tiers are there in the payment structure, you need to generate sales in order to make money in affiliate marketing.
The problem with many affiliate marketers is that they assume they will earn money from the referred sales of other affiliates recruited through their links.
The truth is that the majority of the sub-affiliates won’t even earn a dime during an affiliate lifecycle.
And that’s a problem.
Remember the proverb ‘too many cooks spoil the broth’?
It’s almost the same thing with two-tier affiliate programs.
As an affiliate, you need to understand and realize that the conversion has to happen somewhere down the line. Otherwise, nobody would gain anything from it.
How can you make money with two-tier affiliate programs? The rule of thumb here is to promote the product, and NOT ONLY the program. You should put all your focus on the product and treat your second-tier commissions as just a nice bonus – nothing more, nothing less.
This doesn’t mean you should stop promoting the program. However, you need to invest the majority of your effort in promoting the product, and not the program.
Also, it’s important that you read the fine prints carefully to understand how exactly the two-tier structure works.