What is Tier Affiliate Model?
How will referring new affiliates to an affiliate program make me money in the future? the answer is tier affiliate program. A tier affiliate model is an Affiliate program structure whereby affiliates earn commissions on their conversions as well as conversions of webmasters they refer to the program.
So with a two-tier affiliate tracking system, not only are your affiliates rewarded for sending direct sales to your web site, they also get rewarded for encouraging other affiliates to join your affiliate program.
Using a tier affiliate structure potentially attracts more affiliates and hence more referrals to your site which means more sales for your products or services.
Tier Affiliate Model Example
Say for example, Person A is an affiliate. Person A sends Person B to the site. Person B becomes an affiliate too. Person B referes Person C who buys a product.
In the normal scenerio Person B will receive a commission for referring the sale.
In the tier affiliate model Person B still receives the commission but Person A also receives a small commission since Person A originally referred person B to this site.
PayPal and Tier Affiliate Payout
Just a note of warning: Before you start using a tier affiliate model you should know that PayPal considers tier affiliate model to be spammy network marketing so you cannot use PayPal to pay the tier affiliate commission (you will have to use some other means to make the payout. eg. send physical check or bank transfer). If you do use PayPal to pay these commissions then you are most likely violating their Terms of Use (TOS) and they can shut your account down.
How to use a Two-Tier Affiliate Model in the Affiliate Platfrom Plugin
All you have to do is enable it and specify the values from the settings menu of the WP Affiliate Platform plugin.
2 Tier Affiliate Model Settings
So if you had the “2nd tier commission level” set to 10% and the duration to 30 days then Person A in the above example will receive 10% commission of all sales made through Person B’s referrals for 30 days from the date when person B joined the affiliate program. You can leave the “Duration” field empty in which case Person A will receive the commission indefinitely.
@Marvin, It is all integrated with the standard affiliate ID so there is only one ID each affiliate need to use. The plugin can short out which affiliate referred which affiliate and whose referral made the sale and calculate commission accordingly.
Is there a way to have a 2nd tier affiliate link for other affiliates to signup for the program and it be tracked or is the only option for this to use the referr ID #?
Adam, Thanks for the quick response. Will have to sit down with a piece of paper and a pencil and work through your explanation, as I mentioned, I am new at this and on top of that, I am probably the slowest person when it comes to understanding anything related to computers.
If I could just figure out how to have a world wide Internet business WITHOUT computers, I would be set.
regards
Bryan from Canada
Hi Bryan, This is how it works… when an affiliate signs up, his/her affiliate account will have a parent affiliate attached. Parent affiliate is the Charity in your case (the person/organization that referred the affiliate). To be more clear the charity is the parent affiliate and the supporters are sub-affiliates in your scenario.
All the sub-affiliates (supporters) will promote your product(s) from their sites with their affiliate link. Whenever this sub-affiliate makes a sale via his/her link the parent affiliate (the charity that originally referred this affiliate) will get a 2nd tier commission (a passive commission). The 1st tier commission is always awarded to the affiliate who directly made the sale.
Hi, I am very new at this, I have a question regrading starting a 2 tier affiliate program. I am focusing on charities and non profit organizations.
I am suggesting that charities, sign up as an affiliate and then encourage their supporters to put a link on their web sites , the same as the main charity, to encourage more sales.
My question is this, how would I do this, have one affiliate, the main charity, and then allow as many other web sites to have the same link as the main charity? The main charity would get 40 percent of all sales, as well as an additional 10% for all of the sales that would be generated from the 2 nd tier sales?
Any help would be most appreciated.
Bryan from Canada
I am interested by Paypal’s thoughts on both 2-tier and Multi-level (MLM), this implies there is something wrong with MLM…..
….anyway what interests me more is how they would find out? I mean how does a 2-tier mass payment differ to a single tier mass payment, from a paypal processing point of view? Surely they would have no way of distinguishing one from the other?
@Richard @admin
Just an fyi, Paypal does not permit mass payments on 2nd tier affiliate programs. They never have as they consider this multi-level marketing (go figure). So, if you want to do a 2-tier program, you will either have to manually send all your affiliates their commissions via Paypal or send them physical checks in the mail.
We struggled with what to do for a long time and decided that the inconvenience of sending physical checks or doing manual Paypal payments far outweighs not having a 2nd tier program.
The same URL where you send your normal visitors. Anyone who follows your link and sings up for an affiliate account will automatically go under you.
Hi,
You said: –
Hi Ronen, 1. Signing up as a 2nd tier affiliate is the same as buying a product after being referred by someone. Whenever you are sign up as an affiliate the plugin will check to see if the person was referred by someone. If he was then it will automatically setup the 2nd tier model.
Sorry but would you mind explaining exactly how this work? So what URL do I send to someone if I want them to signup under me?
Great work by the way!
M
Thanks for the response and that’s a bummer. I work for a greenbackstreet.com and I was hoping this was a wordpress plugin that we could suggest to smaller ecommerce sites who want to get on our mall. But since we pay cash back to the purchaser, we have to be able to know who it was that made the purchase.
I have a project on my list to create my own wordpress plug-in to do this but I am only a beginner with php. Oh well, thanks for your response.
If person “B” makes a purchase just as a customer then the referrer “A” will get credit anyway (it doesn’t have anything to do with two-tier setup).
If you want to pass identifier like the following then this is not possible as is:
domain.com/?aff=A&cid=B
I was working on my own plugin when I stumbled across this, which sounds very, very close to what I need. The two-tier is a necessity for me, but I would like for In your axample of Person A sends Person B to the site, I would like to be able to keep track of the fact that Person B made a purchase and give Person A credit for it. The identifier for Person B would be passed into the site via a query string.
For example… domain.com/?aff=A&cid=B
In this scenario B would not be required to become an Affiliate themselves, they are simply a customer.
Such a transaction would appear on the report as a Purchase by null (if no cid was passed in) or B and then Referred By A.
Is this type of thing possible with this plugin as is?
@Tom, Yes, all the affiliate’s data is stored in a table inside the WordPress database. If you can code in PHP then you should be able to extend it’s functionality and customize it for your need.
Thanks for the timely reply. However, rather than a landing page for affiliates to go to, I was curious if the profile information that is created when an affiliate creates their profile will populate their own bio or profile page? I had noticed in your demo login that on the affiliate profile page there were several fields that could be used to populate an affiliate bio page, however, I did not see a field for uploading a photo. I am speculating from your prior response that a profile page for each affiliate is not generated. However, since all the affiliate’s data must be being stored in the database I would imagine it could be queried and used to populate affiliate bio pages with some additional php and MySql. I am guessing we could look at your code and develop an extension for that purpose.
You can use any of your WordPress post or Page as the landing page. For example this is the landing page for my affiliates:
http://www.tipsandtricks-hq.com/affiliate_program
Also the index page of the affiliate center can be used as a landing page too, for example:
http://www.tipsandtricks-hq.com/affiliates
From what I can tell it looks like you have a pretty good plug in here. I took a quick look at some of the sites you have showcased and still have a question. Does your plugin have an option to provide a bio or landing page for affiliates, or is the plugin limited to setting cookies and using session variables to track visitors arriving at the site from the affiliate’s unique link?
@Melissa, I have plans to add more reporting options.
You can individually set every affiliate’s commission level. So the affiliates who perform better can receive a higher commission.
@Richard, To my knowledge PayPal does not have any issues with 2 tier affiliate model. I don’t plan to add multi-tier pyramid schemes which PayPal does not like.
The best would be for you to personally ask PayPal about this. Remember, the option is only there but you do not have to use it (you can use a simple affiliate model using this plugin)
Hi, we are in the process of setting up our affiliate program. I agree that a report on 2nd tier affiliates and their sales would be very appreciated! Also the ability to put people on a different affiliate plan would help also. Start an affiliate at one level and put them on a even better plan when they how success.
Hi,
I have concerns about the 2 tier system if I am using Paypal. Do you have any thoughts about this in relation to their strict tier policy?
Thanks
Richard
Hi Ronen, You can not set a different 2nd tier commission per affiliate. Amin will be working on adding this feature shortly. If you don’t hear from us in the next 7 days or so please feel free to send us a reminder email. =)
Thank you for the quick reply.
what I ment in question 3 was , is it possible to set a different 2nd tire commision to different affliates, for example one will get 10% on his 2nd tier and one will get 20%.
I would love to be notified when the new fetures (2nd tier report and sale amount will be added .
Thank you
Ronen
Hi Ronen, 1. Signing up as a 2nd tier affiliate is the same as buying a product after being referred by someone. Whenever you are sign up as an affiliate the plugin will check to see if the person was referred by someone. If he was then it will automatically setup the 2nd tier model.
2. Will add it at some stage.
3. Yes it is possible to use fixed commission for 2nd tier affilaite. The value you set in the “Use Fixed Commission Amount” settings option will determine what commission model you will use.
4. I have plans to add the option to specify the “Sale Amount” for manual commission awarding. For 2nd tier you will have to manually add the commission.
Hi,
I just got the e-store and the WP Affiliate plugins, great products thank you 🙂
I got few questions :
1. When A\an affliate sign up a 2nd tier affliate, how does he do that ? what link does he send in order to know he refered him ?
2. following the last comment on this post, it would be great if you could add a report of the 2nd tier affliates on ther affliates control panal.
3. is there a way to set a specific 2nd tier commision to an affliate (like it is possible to set for the direct sales) ?
4/ I can see there is a way to manualy enter a commision transaction into the admin panal (a commison that is not throgh the web site ), is it also possible to add there the total amount of the sale (not just the commision) ? it will be very helpful for the total sales reports. and also if it is done manualy , will the up-line affliate will get his commision as well, or do I have to enter it manually as well ?
Thank you
ronen
Hi Mark, there is no report that shows this but it seems like a good idea so I will add it in.
How does the person selling affiliates know how many people are under them . Is there a report somewhere?
Hi Adam, The 2nd commission is paid on the product price also.
do they get both exactly 15% and 10% from $10, which means that person A gets $1,5 and person B $1, or is it calculated differently? Yes this is correct.
Let me know if you have anymore questions.
Cheers,
Ivy
i understand this, but my question was a bit different..
lets say: product A costs $10. Affiliate A commission is set to 15% and Affiliate B commission is 10%.
if person A still receives commission for referring person B, how much do they get?
do they get both exactly 15% and 10% from $10, which means that person A gets $1,5 and person B $1, or is it calculated differently?
thanks,
Adam
Hi Adam, You can specify how much commission you want the 2nd tier affiliate to receive. You can set this is the “2nd Tier Affiliate Settings” of the main setting menu.
Cheers,
Ivy
you wrote: ‘In the tier affiliate model Person B still receives the commission but Person A also receives a small commission since Person A originally referred person B to this site.’
my question is: in this scenario, does the Person B receive commission less commission received my Person A? how’s this calculated?
thanks
Yep, changing the look and feel of the affiliate panel is not that hard if you have a bit of HTML and PHP knowledge. I am going to introduce some themes for the affiliate view in the future too.
Great news! When combined with the coming pay-per-lead feature set I’m sold! The creative possibilities for internet marketers are almost endless!
Leon McKee
P.S. The ability to customize the look and feel along with the content of the Affiliate Panel for a particular business model would be helpful.