MBA1067 Affiliate Program Pitfalls + Free Ride Friday!

Hey, what's going on? Today is Free ride Friday, so make sure you hang on to the end of the episode to hear who won this week's free ride. Every Friday, we give away a lifetime membership to one of our programs. This month we're giving away easy course, our 30 day course on how to build your own online course in 30 days. It sells for $500 over at EasyCourse Co but somebody's gonna win it for free today and we're doing this every week. All you gotta do is leave us an itunes rating and review and you enter our weekly random draw. Listen in on Friday to see if you won't and you enter the draw for every Friday once you left this review until you win. It's our way to say thank you for showing us love on itunes. Now let's jump into today's episode. Hey O. Welcome to the $100 NBA Show. Because we know no one does it alone. That's why we're here for you every single day with our daily 10 minute business lessons for the real world. I'm your host, coach, your teacher, Omar Zenholm. I'm also the co founder of the Hundred Dollar mba, a complete business training and community online. And in today's lesson you will learn all about affiliate program pitfalls. What are some potential problems of having an affiliate program and how to sidestep them or at the very least be aware of them so you know how to attack them when they occur. Affiliate programs are great. They can help you earn more in revenue, get your customers, your existing customers to advocate for your company, write views about your actual business on their blog and earn some commission while they're doing it. But like in any program or any system, there are people out there that just abuse it. There are some things that can happen that you may not expect. When you run an affiliate program. I want to give you some warning. I want to show you what to look out for and how to avoid these things or if they do happen, how to deal with them. These problems will cost you money, they will cost you time and they will cost you headaches. And so avoiding them is really important. I've learned these lessons the hard way and I want to share them with you in today's episode. So let's get into it. Let's get down to business. Today's episode of the $100 MBA show is supported by Podia. Podia helps thousands of creators earn money from their passion. It's an all in one digital storefront that you can sell courses, memberships and Digital downloads in one place, it's the most creator friendly platform on the market with zero transaction fees and a super friendly 24, 7 life support team. No matter what plane you're on. So they're going to take care of you even if you're just getting started. What's great about Podia is that it eliminates all the technical headaches. It takes care of every aspect of selling your course or membership or digital download. If you've got video courses, they do the video hosting for you. If you want an easy way to charge your members on a reoccurring basis for a membership, Podia takes care of it. You want a secure way for people to download your products. When they pay for them, they take care of that too. They also offer free migrations on their Shaker plan. Best of all, Podia puts their money where their mouth is. They have a 30 day free trial with no credit card required. So if you don't love it, you don't pay a penny. If you're looking to start a online course, sell any kind of digital product or start a membership site, check them out and support the show by going to Podia. That's P o D I A.com MBA really quickly. The way an affiliate program works is that you give your affiliates or anybody who wants to promote your products a special tracking link. It's a link to your website that has a tracking code. That way when somebody buys with their link, you can trace the sale back to them. You could say this person referred this customer or and you can accredit the sale to somebody. Now affiliate programs offer different ways to compensate or reward those who refer your business, your product to others. The most common one is a percentage of sale, like 30% of the sale. If your product's $100, then you'd give $30 commission to the affiliate. Some people, it's like a referral program, they give them like store credit or a discount on their next month's bill. But in today's episode, we're going to be dealing with commissions. The problems you have when you have commissions. Referral programs where you give them cred or a discount are pretty safe and the issues are pretty limited because you're not actually giving out money. When you have money on the table, that's when unfortunately problems occur. The most common problem you're going to have with an affiliate program is people purchasing your product using their own affiliate link. Basically, if your affiliate commission is 30%, they're trying to get a 30% discount on your product. You Want to make sure this is plain and clear in your rules, your terms and conditions for the affiliate program, that this is not allowed. The point of an affiliate program is not to give out discounts. The point is to make sales to get new customers or to get your existing customers to refer your business to new people. So you want to make sure that the language is clear. If you want an example of kind of the rules of an affiliate program, you can go to our affiliate program for Webinar Ninja. Just go to webinar ninja.com in the footer on the bottom, you'll see a link for the affiliate program. Or you can go to webinarninja.comaffiliate-program this is a very clear example of all the rules of our affiliate program, and we outline these things to make sure we're protected. It also outlines what affiliates will get paid out, how they approve for commissions, all that kind of stuff. So that's a very common problem. You'll see that people are trying to earn commissions on their own sale. Now we use Stripe as a payment processor, so we could see the actual customer code every time somebody refers somebody. So we can look up that customer code to see if the affiliate is the same person that has purchased. And at that point, we can deny the commission on that product because it's against our rules. The second issue you may face is a little bit more serious, and it deals with fraud. Unfortunately, there are some people out there scamming people. There are people that have stolen credit card information and are using it to make money online. So what they do is that they actually make purchases using their affiliate commission with a stolen credit card. And they do this over and over with different credit cards. And on the surface, it looks fine. Hey, it's a different person, it's a different name, it's a different credit card. This affiliate is rocking it. And what they're trying to do is basically earn commission on sales off stolen credit cards. Horrible. I know. And sooner or later, your credit card processor will flag it and you'll get a charge back. It'll say, hey, this is a stolen card. The customer has said they've never made a purchase with this company. And it's your job at that point to find out who made that sale. Did a an affiliate refer that sale? If so, who was that affiliate? And at that point, you got to look up all the sales they referred. And you may want to contact these people and find out if really they are customers or not. Most likely, all the sales they've actually referred were from stolen cards, and you're going to want to refund those actual purchases and cancel their account. Why? Because one, sooner or later, the credit card holder is going to find out that all these charges are on their credit card and they're going to refer to the bank. And then what's going to happen is you're going to get a chargeback and you're going to get charged a chargeback fee. So not only are you going to have to give up the money anyway in the long run, you're going to get a chargeback slapped onto your account and you're going to pay an extra fee. So it's going to cost you more money. But more importantly, having a chargeback on your actual credit card processing account is not a good thing. You want to minimize as many chargebacks as possible. If you have too many chargebacks, you can unfortunately get suspended, depending on your credibility and your history with that credit card processor. And that's going to stop you from doing any business. So this is why this is such a serious thing. I know. You know, you might be thinking, wow, people really go at great lengths to scam people. Yes, it happens. And this is the Internet. It's kind of like the wild west of scammers. But you can do things to protect yourself. And that's what I like to do. I like to double check every single affiliate. And you don't have to do it yourself. You can hire somebody to do that, double check every sale that affiliate refers, and if something looks shady, you can flag that affiliate and make sure you refund that customer or refund that card. The other thing that people are not mindful of is that with affiliate programs, you have to promote the program. You have to let your customers know that you have an affiliate program, and you have to continue to promote it because you're always getting new customers. So I would add some sort of email automation, some sort of automated email that goes out at some point letting your customers know that, hey, we have an affiliate program. Sign up here. If you love our product, if you share it with others, you can earn commission. You also want to make sure they have enough assets, they have materials they can use, sales copy, images, videos. If you go to our affiliate program page, you'll see that we offer those things right there. So they can use them to make it easy for them to share your product and earn commission. But you have to keep in mind that you can't just put it on your website or just announce it once in a newsletter. You got to keep on promoting it and letting people know. Some people even run contests to try to promote their affiliate program, meaning that the top 10 affiliates every month get a prize or the top three first place gets this, second place gets this, third place gets this. And that can be helpful as well and fun and exciting. With affiliate programs, you also have to make sure that you keep in mind a refund grace policy, meaning that at some point your customer might refund their product. You don't want to pay out commissions before that grace period is over. So say for example, you have a 30 day money back guarantee. You want to make sure that your affiliate payouts are after the sale and after that 30 day period to ensure that hey, I don't want to pay out commission on a sale that might get refunded. It's a lot easier to give out money than to get it back from an affiliate. So make sure that you keep that in mind. I would even add a second grace period after the 30 days because sometimes you have exceptions. People miss that 30 day money back guarantee and day 31, 30, 32, they're like hey, can I get a refund? And you make an exception. So maybe you want to make a 45 day grace period in this example. This ensures that you are only paying out commissions on affiliate sales that stick. This is less of a problem for reoccurring sales because mostly if you have a reoccurring membership, there are no refunds. Something like a Netflix model where you pay every month. But even so, a grace period might be useful. Guys, I got more on today's topic, affiliate program pitfalls. But before that, let me give love to today's sponsor. Today's episode is supported by Emma. Here's some advice to anyone who sends emails to their customers. You deserve a better email marketing platform, one that's actually designed with your type of organization in mind. And unlike other email providers, Emma puts its customers first, offering powerful email marketing with a personal touch. With Emma, you'll have everything you need to connect your data, build your audience and do your most successful marketing effort because their easy to use platform makes advanced functionality accessible to everyone on your team. No technical skills required. And you can even connect Emma with services you count on to run your business, like Salesforce and Google Analytics. Not to mention, Emma's award winning team is always ready to support you on your email marketing strategy, design list, migration and more. So put the power of email experts behind your marketing. Request a customized demo of Emma's email marketing platform today@myemma.com Again, that's myemma.com to wrap up today's lesson. Running an affiliate program can be really, really fruitful. To market your product, you get your best customers, your best users to promote your products for you, to promote your services for you. They are your best salespeople because they're satisfied. It also allows others to write great content for you, great blog posts, great reviews, YouTube videos in the effort of making commission sales, commission on their affiliate sales. So it's kind of like a content generation machine. It also allows a way for you to reward some sort of partnership. Say, for example, you want to do a partner webinar or you want somebody who's a tastemaker in your marketplace to promote your products on their blog or on their newsletter. And this way you can give them a commission for sales that they make. It's sort of an incentive. But everything has its cons. You know, you have some pitfalls that you have to be aware of. I outlined them today. These are the most common pitfalls you got to be careful of. You can cover it. I go through these pitfalls and I still have an affiliate program. It's still worth it. It still is worth, even when I have to avoid these pitfalls. So don't let today's pitfalls discourage you. Affiliate programs are definitely, definitely powerful. Well, that wraps up today's lesson. But today's episode is not over. It's Free Ride Friday. I gotta give away a lifetime membership to Easy Course. Let's see who won this week's free ride. And the winner is. Victor in LA. Victor in LA says the 100 RMBA is the real deal. 5 stars. As an entrepreneur, I listen to podcasts daily to stay on top of things and the $100 MBA is in my top 10 list. Homer is a super interesting guy with quality topics and his sincerity and experience is integrated in the podcast. Give him a well deserved listen. My only feedback is he needs to upgrade the intro. So great feedback. Thanks Victor. Let's see how we can shake things up in the beginning. But more importantly, congrats. You are our Freeride Friday winner. You won the weekly random draw. Just email me over@omar00nba.net, I would love to hook you up with our free ride to Ezcourse. If you want to win a free ride, just leave us an iTunes rating and review and you enter our weekly random draw to win. Just listen in on Friday to see if you won and you enter the draw every week until you win. Thanks so much for listening but before I go, I want to leave you with this. If you don't want to deal with an affiliate program, promoting it, managing it, you know, paying out affiliates, you don't have to. It's optional. You could totally run your business without an affiliate program, and you could be totally fine. But it is an option if you're looking to get more sales growth, get more users, more customers. It's definitely a growth hack. All right, I'll check you in Monday's episode. I'll see you then. Take care, Sam.