2 Tier Affiliate Programs What are they? 2 Tier affiliate programs are set up to maximize the income for the affiliates who use them. It also enables the company offering the affiliate program the ability to rapidly grow their affiliate base. 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. 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 your "2nd tier" 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. The 2 tier system is becoming one of the more popular systems in affiliate marketing these days. As people become tired of the multilevel marketing schemes (MLM) and realize it typically is not as lucrative as they thought, 2 tier systems will pick up more and more. Not that MLM systems don't work, but the idea of "you refer 10 people who refer 10 people who refer another 10 people, etc" looks good on paper,
Nice article, but we need to consider Tier 3 level as well. Ex. If A introduce B affiliate and A will earn Tier 1 commissions on B sales. And suppose B introduce Affiliate C then B will earn Tier 2 commissions on C sales and Affiliate A will earn Tier 3 commissions on C sales as well.
Re: I really like the post. Well among 2 tier and 3 tier affiliate program i would prefer the 2 tier. Because of the complexities involved in three tier. Two tier affiliate program is always easy and flexible to implement.
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