Commission for New Customers Only – Bad Affiliate Marketing Practice

I have just looked over descriptions of several affiliate programs run by established brands, and noticed that some of them reward affiliates only for “new and unique” customers (wording retained, italics mine). Wow… They are pushing away thousands of affiliates on the pre-recruitment phase just by having that policy in place. In fact, this is just one silly affiliate marketing policy to have. Why? Let me illustrate it for you.

In the survey conducted for my “Online Shopping Through Consumers’ Eyes” book, I asked people the following question: “When shopping for products requiring ongoing replenishing (e.g.: grocery, ink, bank checks, etc), and receiving satisfactory service, would you still compare your retailer’s offer to other offers next time you need their product?” Here’s how their replies translated into a graph:

Are you still 100% positive that your satisfied customer will return to you? The above clearly illustrates that the majority will go out and compare you to your competition again; and the more aggressive you are in your affiliate marketing (read: pushing your brand and your product via an affiliate-friendly program through as many channels of online marketing as possible) – the more chances you stand of having that customer come back and shop with you again. Of course, the competitiveness of your offer is important, but in the context of two equally attractive offers, it is the brand with larger online presence that will win.

Merchants that run affiliate programs should compensate every sale equally, or even offer an additional bonus for new customers; but, by no means, should they limit affiliate commissions to new customers only! It is simply one bad affiliate marketing practice.