A 2-tier affiliate program is one in which you earn money from your own sales, as well as from the sales of the affiliates you recruit.
An important distinction here is that this is not multi-level marketing (MLM). In an affiliate program, you only get paid for sales made by your immediate recruits. In multi-level marketing, you get paid at many levels below you.
So let’s take a look at some of the pros and cons of 2-tier affiliate marketing programs, and what can make them some of the most profitable products to engage with.
1. You make money from the sales of the affiliates you recruit.
This allows you to multiply your efforts. You can only make so many sales per month personally, but if you also had 100 affiliates below all of you selling, just think how much more money you would make.
You only need one or two real entrepreneurs to make a lot of money in a 2-tier affiliate program and because there are so many people involved in this industry today, getting others to join is relatively easy if you make them fully aware of what? What will they gain if they enroll in the program you promote?
2. You don’t need your own product
What makes this the best program for everyone involved is that all the setup work has been done for you. The product is created, marketing materials are readily available, commissions are calculated and paid on your personal sales, as well as on your team’s sales, etc.
Products that do not require manufacturing (such as e-books) tend to be very successful in affiliate programs. The reason for this is that the merchant can afford to pay a higher commission. Once the product is created, there are very few ongoing costs to the owner. Therefore, it is not uncommon to see them offering commissions of up to 50% -75%. This, in turn, makes selling the product that much more attractive to money-driven affiliates.
A 2-tier affiliate program for a digital product will tend to pay slightly less on the first tier, but offers you the opportunity to earn much more money in the long run by hiring people to sell on the second tier.
3. You can work and create your own sales team.
If you are the type of person who enjoys working with other people, 2-tier affiliate marketing programs are great for that. Some of the best affiliate programs on the market today are those where you are given training that helps you work towards developing a successful team and this team attitude can be taken to the level you want.
For example, you can create contests within your own team to increase sales and help everyone earn more money.
There aren’t a lot of downsides to two-tier affiliate programs, but the biggest one that people tend to find is that the affiliates themselves fall into the management trap. This is where they start spending more time trying to develop their own team and less time on their personal sales.
Because affiliate marketing programs are so free and accessible, recruiting affiliates is extremely easy. The problem is getting them to a point where they succeed themselves. There is a high churn rate in affiliate marketing and you can waste a great deal of time helping people who will never have the drive to succeed.
Another downside is that you are giving up a percentage of your personal sales to participate in the program. There is only a limited amount of money that can be paid and spreading it over 2 levels takes away the first level commissions, but as I said before, managed correctly, this should not be a problem.
There are many good 2-tier affiliate programs on the market today and if you like communicating with people, they are a great way to work towards your financial freedom.
