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Multi-Tier
Affiliate Programs
What
are they?
Multi-Tier
affiliate programs are a lot like the 2-Tier
Affiliate Programs in that affiliates can earn commissions
on not only their sales, but also the sales of affiliates they
refer to the affiliate program. The difference is, a multi-tier
program is generally up to 4-5 levels deep, meaning you could
in theory can paid a lot of money by simply referring tons of
people to the program and wait for them to start making sales.
Here
is (a basic idea) of how it works:
Company
A offers an affiliate program that pays its affiliates 10% for
each sale that affiliate makes.
This is a 1-Tier program (also known as straight commission per
sale).
Company
A then decides it wants to grow their affiliate base to get more
people selling their products. So, they introduce a second tier
affiliate program. Each affiliate still gets the same 10% commission
per sale, but now, the same affiliate can earn 4% on the sales
from affiliates they refer to the system.
They
keep going on with the 3rd tier at 4%, 4th tier at 3%, etc, etc.
The
idea behind this is, as an affiliate yourself, you have the ability
to sign up other affiliates under you. In an ideal world, the
more affiliate you sign up on the "tiers" below you,
the more money you can make. It is really a win-win situation
for everyone. The company you are working with gets more people
selling their product. The affiliates have the ability to earn
money from the work of the affiliates they refer.
This
system is also known as multilevel marketing (MLM) due to its
multiple levels of potential commission earnings. Many businesses
have been successful using this type of program. A couple that
come to mind are Mary Kay and Tupperware. These are high level
MLM companies that are set up to pay on several levels. (That's
why your friends try to get you to have "parties" all
the time. If they recruit you, they earn a percentage of everything
you sell at "your" party)
Click
here to see reviews of some multi-tier affiliate programs
and determine which one will work best for you.
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