As many of you know, I’ve become a regular reader of the Affiliate Marketing Blog. It’s got some great insights into affiliate marketing. In a recent post, Shawn Collins discusses via video how a merchant can calculate the ROI on an affiliate marketing campaign. You can check out the rest of his post here but the gist of it is quite simple. A merchant’s ROI is calculated by taking revenues generated from the program and subtracting from it these three costs: 1) Cost of personnel managing the affiliate marketing program 2) Cost of commission to the affiliate marketer (the one driving the sales to the merchants) 3) Cost of affiliate marketing network or software While it might seem straight-forward, I think it’s a great idea to provide this clarity to merchants. Affiliate marketing isn’t a widely understood discipline, especially by traditional marketers. So everything Shawn and his affiliate marketing followers can do to shed some light on this very effective marketing strategy.
