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Affiliate marketing is a straightforward procedure of earning through commissions. You are required to provide links to affiliate websites in your chosen field. Thereby you promote the products or the services of the merchant whose website you have endorsed. Every time you send a visitor to the affiliate website and the visitor performs the required action, the agreed commission is paid to you. The word ‘tier’ is often encountered in the affiliate marketing business. A tier means ‘a step’. In the context of the affiliate business, it usually signifies ‘down-line levels’.
This indicates that: • When an affiliate, say X, introduces a new entrepreneur, Y, to the affiliate program which X subscribes to, Y becomes the next in line to X. That is, Y is placed in the second tier below X.
• Now, if Y brings Z into the program, Z is placed in the third tier below X.
• Say, Z refers a customer who performs the necessary action. Then, Z receives the first tier commission, which is normally paid to every affiliate on introducing an effective referral.
• Y would receive a second tier commission.
• X receives a third tier commission. Thus, for the commission paid to every affiliate in the down-line, X receives an incentive. The income of X thus increases beyond mere commissions for his own efforts. Tier may also refer to the sales volume in some affiliate marketing plans. Say for example: • On the first $100 worth of merchandise X manages to sell through referrals, X gets a 30% commission. Up to $100 is the first tier.
• The next tier is $500. For every sale between $100 and $500, X is paid a 40% commission.
• Thus, the commission increases with every range of monthly sales, or each tier. Two-Tier And Multi-Tier Affiliate Programs A 2-tier affiliate-marketing program:
The commissions of an affiliate are generated from both direct sales and from second level sub-affiliates. Say for example the visitor that an affiliate sends the merchant’s website purchases product “A”. As soon as the customer clicks on the “order” tab, he is presented with an option to purchase product “B”. Subsequently, the customer ends up buying both products, the referee affiliate is paid a commission on both A and B. The point to be noted here is that, the affiliate will be paid only once, i.e. only for the customers who have made the purchases for the first time. If the same customer comes back after a week, the affiliate will not get any commission. Multi-tier affiliate marketing program:
It is explained in the example for the down-line tiers. In a multi-tier affiliate program, the affiliate earns commissions resembling the 2-tier affiliate programs. The affiliate will also be paid from the commissions of his/her sub-affiliate’s affiliate. Thus, when an affiliate builds up a network of affiliates below him/her, additional commissions can be earned. The best affiliate marketing programs offer a tiered structure. |
