What Is Affiliate Marketing Strategy For SaaS Businesses?
Did you know that affiliate marketing generally makes 15% to 30% of all sales for digital products?
Affiliate marketing has proven itself to be an effective and cost-efficient way to acquire customers and grow revenue for digital products.
For software-as-a-service (SaaS) products, in particular, affiliate marketing can be a great growth strategy. It leverages content marketing and can establish a win-win setup between you and your affiliate partner.
So buckle up as we discuss what is affiliate marketing strategy and how you can successfully implement it for your SaaS company.
What is SaaS Affiliate Marketing?
The basic idea behind SaaS affiliate marketing is this:
You, as a SaaS company, partner with other people or businesses who promote your product to their audiences in exchange for a commission on any sales they generate.
This usually works with them using an affiliate link on their content.
Any potential customer who clicks on the link gets directed to your product page. If they make a purchase, it will result in your affiliate partner getting a commission.
For example, let’s say you have a SaaS product that helps people manage their finances better.
You could partner with someone who runs a blog on financial tips and they promote your product to their audience through an affiliate link on one of their blog posts.
If anyone clicks on the link and goes on to buy your product, the affiliate would get a commission.
This is a very simplified version of how SaaS affiliate marketing works. But hopefully, it gives you a general idea.
What Types Of Affiliate Marketers Can You Work With?
There are three main types of affiliate marketers you can work with:
Content creators are, as the name suggests, people who create content. This can be in the form of blog posts, YouTube videos, podcasts, or even infographics.
The key here is that they have an audience that trusts their opinion and is interested in what they have to say. And if they like your product, they’ll promote it to their audience.
SaaS Product Reviewers
SaaS product reviewers are similar to content creators in that they also have an audience that trusts their opinion.
However, they dedicate their content (or at least some of their content pieces) to providing thorough feedback on various SaaS products.
This is a great way to get some early exposure for your product as these affiliate marketers are generally well-respected in the industry.
Social Media Influencers
Social media influencers are people with a large following on social media platforms like Twitter, Instagram, or Snapchat
They usually have a personal brand and are seen as thought leaders in their industry or niche. And if they promote your product, their audience is likely to pay attention.
SaaS Lifetime Deal (LTD) Marketplaces
SaaS LTD marketplaces are websites that sell time-limited deals on various digital products, including SaaS products.
These marketplaces have a large audience of deal-hungry buyers who are always on the lookout for new products to try.
So if your product is featured on one of these sites, it can lead to a significant spike in sales.
How To Implement A SaaS Affiliate Marketing Strategy
Now that you know what SaaS affiliate marketing is and the different types of affiliate marketers you can work with, let’s discuss how you can successfully run a SaaS affiliate marketing strategy.
Here are some steps to get you started:
Define Your Goals
Before you start reaching out to potential affiliate partners, you need to first define what your goals are
Are you looking to increase brand awareness? Drive free trial sign-ups? Boost sales of a specific product?
Keep in mind that each goal will require a different approach.
For example, if you’re looking to increase brand awareness, working with content creators would be a better option than reviewing sites.
However, if you’re focusing on nurturing your leads and converting them into paying customers, working with review writers might be a better option.
Establish Your Commission Structure
In order for your SaaS affiliate program to be successful, you need to offer a competitive commission structure.
This will not only incentivize potential partners to promote your product but also help you attract the best affiliate marketers.
When you’re figuring out your affiliate commission structure, you need to consider three things:
- What to commission
- Commission rate
- Commission frequency
What To Commission: One of the biggest challenges in affiliate marketing is how to compensate affiliates that don’t necessarily get their customers to buy your product, but have contributed greatly.
Let’s look at this from the perspective of the customer journey.
If a potential customer is still at the earliest stages, they will likely encounter content from the bloggers among your affiliates that they may not be ready to buy just yet.
But when the potential customer is ready for a purchase, it may be the reviewers’ content that seals the deal.
As a result, reviewers are likely to generate more sales than content creators who produce purely educational content. They also get the bulk of the commissions.
That doesn’t sound very fair, does it?
To get around this, you may choose to commission different types of conversions, such as the following:
- Pay per click
- Pay per lead
- Pay per free trial sign up
- Pay per sale
This way, you can better compensate your affiliates while still achieving your business goals.
Commission Rate: The commission rate is the percentage of each sale that you’re willing to give to an affiliate marketer.
You can do this at a fixed rate or a tiered commission rate.
With a fixed commission rate, you offer the same percentage to all your affiliates, regardless of their level of experience or the quality of their audience.
A tiered commission rate, on the other hand, allows you to offer a higher commission rate to experienced and high-performing affiliates.
For example, you could start with a base commission rate of 10%.
But affiliates who perform well may get higher rates. Those who bring in at least 50 customers could have 15%. Or those who bring in 100 customers could have as much as 20%.
This structure is a good way to incentivize your affiliates to keep performing well while still providing them with the opportunity to earn more.
Commission Frequency: The commission frequency is how often you will pay your affiliate partners their commissions, which could get tricky when it comes to selling a SaaS product.
It’s easy to figure out when you have one-time payments. You simply pay your affiliates their commission whenever a customer buys your product.
But with recurring payments, it’s not that simple.
One way you could do this is to give them a recurring commission.
For example, you could give them 10% of each payment made by the customer for as long as the customer remains a paying customer.
You may also choose to put a cap on their recurring commission. For example, they will only get recurring commission for the customer’s first 12 months.
There’s no right or wrong answer here. It really depends on what makes the most sense for your business.
Create & Distribute Your Marketing Materials
Your marketing materials are what your affiliates will use to promote your software. This includes things like:
- Social media posts
Creating these assets can be time-consuming, but it’s worth it to have high-quality materials that will help your affiliates sell your product.
Once you’ve created your assets, you need to put them somewhere where your affiliates can easily access them. The best way to do this is to create a dedicated affiliate portal.
This is a central location where all of your affiliates can log in and find everything they need to promote your product, including your marketing assets and affiliate links.
If you don’t have the time or resources to create an affiliate portal, you can also just send your affiliates an email with all the information they need.
But an affiliate tracking software is the best way to keep your affiliates organized and make it easy for them to find what they need.
Now that we’re talking about affiliate marketing tools, let’s also discuss another important one.
Use An Affiliate Tracking Software
Tracking your affiliate sales can be a challenge, especially if you’re selling a SaaS product.
That’s because, with recurring payments, it can be hard to keep track of which customer came from which affiliate.
Fortunately, there are affiliate marketing software solutions that can help. These solutions will track your affiliates’ sales and give you the data you need to pay them accurately.
Some popular affiliate tracking software solutions include:
These solutions typically come with a monthly fee, but they can save you a lot of time and headaches in the long run.
Identify Your Ideal Affiliate Partners
Once you know what your goals are, you can start identifying potential affiliate partners that fit those goals
Here are some factors to consider:
- Their audience size and engagement rate
- Their content quality and style
- Their content distribution platforms and channels
- Their past experience promoting similar products
- The relevance of their audience to your product
You don’t need to find affiliates that fit all of these criteria. But the more, the better.
Reach Out to Your Affiliate Partners
Once you’ve identified some potential affiliate partners, it’s time to reach out to them and see if they’re interested in promoting your software.
The best way to do this is to send them an email.
In your email, be sure to include:
- An overview of your product and its main features
- Your affiliate commission structure
- A link to your affiliate portal (if you have one) or your marketing assets (if you don’t)
- A call-to-action (CTA) button for them to sign up as an affiliate partner
If they’re interested, they’ll get back to you and let you know. If not, that’s okay too. Just move on to your next potential affiliate partner.
Promote Your SaaS Affiliate Program
If you want to scale your SaaS affiliate marketing program, you can’t be content just by proactively reaching out to potential affiliates.
You need to be able to attract more of them.
This means promoting your affiliate program to make it more visible and attractive to potential affiliates.
So make sure to make it visible on your website and social media profiles.
The more people that know about your affiliate program, the more affiliates you’ll attract. And the more affiliates you have, the more sales you’ll make. It’s a win-win.
SaaS affiliate marketing is a great way to scale your business by getting other people to promote your product for you.
But before you start, you need to figure out your affiliate marketing strategy. This includes what type of affiliates you want to work with and what kind of commissions you’re willing to pay.
Once you’ve got that figured out, it’s time to start creating and distributing your SaaS marketing assets. And finally, reach out to potential affiliates and promote your program to attract even more affiliates.
Do all of this, and you’ll be on your way to a successful SaaS affiliate marketing campaign in no time.
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