'Affiliate Marketing'
- What You NEED To Know.
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What is a Tier in Affiliate Marketing?
Author: Clay Mabbitt
The word "tier" shows up a lot in the affiliate marketing industry. In a general sense a tier is a step or level, but what does this mean in the context of affiliate marketing. The answer is: it depends.
Downline Levels
The most common meaning of tier is a carry-over from the compensation plans of network marketing companies that were in place before the Internet boom. When you introduce a new entrepreneur to the program, he is placed on your second tier. If that new entrepreneur then introduced his sister to the program, she would be placed on your third tier.
If the sister brought in a paying customer, she would receive a first tier commission. Her brother would receive a second tier commission, while you received a third tier commission (if the compensation plan included a third tier). In practice, an affiliate program can offer commissions on any number of tiers, although the vast majority of online affiliate programs only pay commissions on one or two tiers of activity.
Sales Volume
You would get a different picture of the word tier from Amazon's compensation plan, where it refers to your sales volume. (The following numbers don't reflect Amazon's actual compensation plan, but they serve as an example.) On the first $500 worth of merchandise you sell, you receive a 10% commission. Up to $500 is the first tier. The second tier is for sales up to $1500. If you manage to sell between $500 and $1500, you will earn 11% commission. Each tier is an additional range of monthly sales in which you earn a higher commission (or receive other forms of compensation).
The Problem
The confusion arises when affiliate programs emphasize that they run a 2-tier compensation plan in their affiliate recruiting efforts. In most cases, this refers to the downline levels definition, and participants can expect to receive compensation based on the performance of affiliates they introduce to the program.
Occasionally, a program makes this claim when referring to sales volume tiers. This isn't inaccurate, but it is misleading. The managers of these programs are almost never intentionally trying to mislead. More often, they have thoughtfully crafted a compensation plan that rewards affiliates who perform well, and they want to announce that feature to all potential affiliates.
Who's Right?
You could make an argument for either definition of tier. If you're trying to communicate with other people in the affiliate industry, though, you need to give strong consideration to which meaning is generally accepted by most people. That is the downline levels definition.
About the Author
Clay Mabbitt writes articles about online income opportunities. He is the founder of a community of Internet entrepreneurs sharing knowledge and experience at http://www.affiliatescreen.com
Article Keywords:
'Affiliate Marketing'
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As you may know, I have a very deep passion for Affiliate Marketing. In
fact, this website is a true labor of love for me.
As publisher, one my many duties is to review the many books, programs,
ebooks, and courses about Affiliate Marketing that are on the
market today. I’ll be honest with you. Most of
them are garbage. (Although I do strongly recommend the programs
in the “Must Have” box to the left).
But, let me tell you, when I came upon the following headline,
I new I found a winner…
"Earning Extra Income With Affiliate Marketing –
Having
Your Cake and Eating it Too!”
Now, the reason I knew it was a winner was because of the name behind
the headline. James Martell.
Many consider James to be
one of the true geniuses in our field. I have a lot of respect
for him, and I
urge you to drop what you are doing right now and read this.
I’m going to leave this note up for a few days, but will probably
take it down soon, so if you are interested in saving a few bucks,
go
here now.
Talk to you soon!
-Bob
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