10 Reasons Not to Launch an Affiliate Program

by Brook Lenox on December 11, 2009

tenI talk to a lot of companies about affiliate marketing. For those not familiar, an affiliate program is a program where you pay partners for sending you sales or leads.

Companies like Amazon, Apple, Best Buy, and many others all have internet affiliate programs.

But the truth of the matter is that they don’t work. I repeat, they don’t work (in bold to emphasize how firmly I believe this). 

Top 10 Reasons Affiliate Programs Don’t Work

In David Letterman style, here are the top 10 reasons you should definitely stay away from affiliate programs.

#10 The concept is way too simple to work
“No one would sell our goods on a commission only basis.”

#9    It’ costs too much to get started
“I’d rather hire sales people with a salary, medical benefits, and company cars.”

#8    We don’t have someone to manage it
“Because there aren’t LOTS of companies out there to outsource to.”

#7   The revenue potential is too low
“I’ve heard an affiliate program might only increase my revenue by 10-20%.”

#6   I’ll have to give up too much in margin
“I’d rather pay 15% to our agency for awareness, than 15%  to an affiliate for a sale.”

#5   It seems so risky
“I’d rather bet it all on a superbowl commercial with a sock puppet.”

#4   There are other more cost effective ways to get sales
“Let’s hire an Elvis impersonator and hit the trade show circuit.”

#3   I can’t control my marketing messages
“Like I can on Twitter, Facebook, and other social media websites.”
#2   I don’t want 1,000’s of commission only sales people
“They may make my in-house sales team look bad.”

Drum roll…and the #1 reason not to launch an affiliate program
#1   I don’t want to grow my business!!!
“I like my job and don’t want to risk getting promoted.”

NOTE: If you missed the sarcasm above I’m sorry :) .

All kidding aside, affiliate programs work. Try em, you’ll like em.

Photo Credit: cesarastudillo

{ 2 comments… read them below or add one }

MattjDrake December 17, 2009 at 6:13 am

Another reason * not* to start an affiliate program: because you don’t want to deal with all those new customer relationships just because they are more likely to buy your next product…
.-= MattjDrake´s last blog ..How To Use UIScrollView in Your iPhone App =-.

Brook Lenox December 18, 2009 at 2:24 pm

Matt…good point. New customers could be an issue.

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