Two-tier equates to leveraging
Individuals and entrepreneurs who are unfamiliar with affiliate marketing may consider two-tier a new term, but to those who are involved in such a money-making enterprise the activity could represent an additional income stream. Two-tier can be best explained as an enticing feature of certain affiliate programs whereas, affiliates are allowed to recruit and sign-up other affiliates (sub-affiliates) below them, so that when the sub-affiliates – otherwise known as second-tier affiliates – earn a commission, the recruiting affiliate also receives a commission (override in some businesses).
In two-tier systems the first tier commissions are just like they are paid in a standard affiliate program with the only difference being that such systems have an additional tier or sub-affiliates, whereby first line marketers – or recruiting affiliates – are also paid a commission once their recruits generate sales. Theoretically, affiliate programs can have a multi-tier system with an infinite number of tiers; but there are practical limitations. As tiers increase, the affiliate program draws more webmasters who are mostly interested in making a profit from other people’s work and efforts.
Anyone who is familiar with the structure of a Multi-Level Marketing (MLM) will probably agree that Two-Tier affiliate programs is as close to a MLM as it gets. Think about it this way for a moment: When you sign-up for an affiliate program, you are identified as the first tier marketer, and the person that you recruit or encourage to sign up is the second tier. If the recruiting ceases at this point there is probably no reason to compare the two structures. However, if there are additional tiers comparisons can be made and the Two-Tier affiliate system may be regarded as a MLM.
Opting for your affiliate merchant
Of course it is a well known fact that today’s MLM-structured networks aren’t as effective and successful as they were several decades ago, and along the way to their less-than-optimum performance, some networks have managed to tarnish the credibility of an entire industry. So very few systems, networks or businesses – if any – are eager to be compared to MLMs these days. On the other hand, present day affiliates can freely select from thousands of affiliate programs; and they can quickly switch from one program to another.
You could probably go wrong if you’re thinking that you can depend on your second tier affiliates to do the job for you; but if you want to use two-tier affiliate programs to your advantage and generate more income by encouraging sub-affiliates to sign-up below you, it is important to make sure that you carefully choose your affiliate merchant. Select those merchants:
- That generate a stable stream of high quality products;
- That payout high or just commissions;
- That offer real time tracking;
- That furnishes you with a proven and tested advertising arsenal;
- That treat their affiliates very well;
- That generate high visitor-to-sales conversion rate;
- That has a user-friendly website to monitor visits & sales stats, and;
- That has powerful marketing tools which can be used to promote their products
Careful merchant selection protects credibility
To opt for anything other than an affiliate program or system which consists of the above features and/or characteristics is simply a waste of your time and effort; and what may be worse, you may be damaging your integrity and credibility once you start promoting poor affiliate programs. Make no mistake, your visitor will be quick to make the presumption that any product or service you’re reselling must also be dreadful. That’s the reason why it is important to opt for first-rate affiliate programs.
Top-rated affiliate programs allow you, not only build up a good relationship with your visitor, but also to easily get more sub-affiliates to sign-up under you. You should also be cautious of some affiliate programs that give more importance to profits that can be earned by taking on other affiliates, than on the income from sales; because you’ll just eventually find out that someone has already close those sales without informing you.
You’ll find that a program which places a premium on sub-affiliate recruiting usually offers very low first-tier payments; but extremely high second-tier commissions. However, if you want to start an affiliate program of your own, you certainly have the option to decide whether it will be a single tier or two-tier affiliate program. No one can truly predict which of these two programs are better; but let me say to you that the benefits which can be derived from a two-tier affiliate program are several.
When two-tier works, it’s advantageous!
First, your profit will increase due to increased sales from the customers that your second tier has referred. Second, you have a much broader customer base to which you can sell your products and services. Then, you gain more and stable income because the customers referred by your affiliate and sub-affiliates could probably develop a lifetime loyalty on your site and your products. Plus, you’ll have an army of sub-affiliates who will promote and resell your products and services to their visitors and subscribers.
Two-tier programs have been a proven effective money makers and should be the number one choice for budding affiliates, as well as affiliate program managers. And keep in mind that when you start generating profits from your site in addition to your tiers, you can consider this the right time to conclude that you have used the two-tier affiliate program to your advantage. All this without ever having to be compared to a MLM. Good luck! 🙂
