Launching an affiliation campaign: how much should affiliates be paid?

It’s the big day, you’ve made the (wise) decision to start an affiliation campaign: you’re ready to activate a network of business partners, and pay them on the basis of the sales they generate.

Your banners are ready, you’ve chosen your platform, and you’re about to sign the contract. One question remains: what percentage of your sales will you give to affiliates when they bring you a sale?

This percentage, which can be described as remuneration, CPA or commission, is one of the most important criteria for the success of your campaign, and it’s up to you to determine it. The platform will have its say, and will recommend a level of remuneration in line with market standards. That said, you’ll probably want to make up your own mind on the matter, and that’s only natural.

How do you choose the most appropriate remuneration, and above all, what is the reasoning behind this choice?

What does the competition do?

Your campaign will be displayed on the affiliation platform of your choice, alongside other advertisers’ campaigns. The success of your campaign depends directly on the number and quality of affiliates who choose to sign up and generate sales for your site. The key is to make your campaign attractive.

To better understand this point, let’s put ourselves in the shoes of an affiliate. For example, the writer of a blog whose general theme is sports, and cycling in particular. The owner of this blog will visit one or more affiliation platforms, and “shop” among the campaigns that will enable him to monetize his audience. He’ll find the following campaigns from merchants in the bike parts and cycling equipment sector: (actual examples – May 2018) :

Alltricks	7%
Santa Fixie	6%
Retto.com	6%

 

If an online bicycle merchant were to launch a campaign with a remuneration of (say) 3%, it would be a guaranteed failure. Indeed, the remuneration would be half of what other brands can offer.

What does this mean? If you start your campaign with a remuneration below the market average, you will automatically be disqualified. Affiliates will prefer campaigns with the best remuneration. This is not the only factor: an affiliate will prefer to work for a major brand, even if the remuneration is not the highest, because he has confidence in the merchant’s product offering and its ability to convert the traffic sent.

That said, you can’t afford to activate a campaign with a payout below the market average, around 6-7% in our example.

How do you determine this average? The easiest way is to visit https://www.clubaffiliation.com, a veritable affiliation catalog, which will enable you to quickly find out what your competitors are paying you.

Profitability: choose your ROI

The second criterion to consider is your profitability. How much is it worth to you to pay for a sale?

A major advantage of affiliate marketing over other acquisition channels is that you choose your own ROI. This is because the proportion of sales that will be allocated to affiliates is fixed. Corollary: your ROI, i.e. the proportion between the return (your sales) and the investment (the commission), will always remain the same. Only the volume of sales generated may vary.

A campaign paying 8% will always have an ROI of 100/8=12.5.

From there, it’s up to you to compare these figures with your margin. Is the proportion of margin this represents acceptable? When you add the cost of your other acquisition channels that may be involved in the same sale, are you still on track?

You also need to consider a key point in measuring your profitability: customer lifetime value. The new customers brought to you by affiliation will be present in your customer base, they are part of your community, and are likely to come back to make new purchases, to be your ambassadors. The ROI of a sale is in fact always better than the simple calculation presented above.

It’s obvious, but better said: the aim of an affiliate campaign is to generate profitable business for the merchant. However, being too greedy and not rewarding affiliates sufficiently for their contribution will prevent the campaign from succeeding. What’s the point of having an extremely profitable campaign, if you convince few or no affiliates to work with you?

The ideal situation is one where you can position yourself slightly above the competition, while remaining profitable. You then guarantee maximum volume with the best ROI reasonably achievable.

What are the objectives?

The two previous criteria are the central ones for determining the remuneration of your campaign. But it’s possible to go even further, and adopt “finer” remunerations according to your objectives or constraints:

I need sales, but also to boost my traffic: add a CPC to your CPA payment! For example, 5% CPA + €0.10 CPC.

I want to give myself every chance of successfully launching my campaign: don’t hesitate to offer boosted remuneration during the first 3 months of the campaign, to motivate affiliates to get started, test your campaign and hook them!

My margins vary greatly according to product category: it is possible to automatically modulate remuneration according to product category! A percentage can be defined for each of them, just make sure that it remains “legible” for affiliates.

I’m destocking some products: once again, it’s very easy to increase the payout for a specific list of products, and to inform your affiliates.

I’d like to increase the volume of my e-mailing base: add a CPL (Cost Per Lead) fee to your CPA fee, where a lead represents a subscription to your newsletter. For example, 5% CPA + €0.20 CPL.

I’d like to boost new customer acquisition: justas remuneration can be modulated according to the product, it can also be different if the end customer is already in your customer base or not. Your remuneration is then adapted to the value of the acquisition made. For example: “New customer” sales: 12% CPA, “Old customer” sales: 7% CPA.

In a nutshell:

• Take a close look at what your competition is doing, and be competitive.
• Choose your level of profitability, making sure that your affiliates want to bring you sales.
• Use hybrid or differentiated remuneration to better calibrate your campaign.

Now you have all the information you need to choose the right remuneration and launch a successful affiliate campaign! And if you still have any doubts, contact us – we’ll be delighted to guide you.

 

 

 

 

Mis à jour le 20 April 2025