Offering affiliate programs is growing as a promotional tool for small business owners. A report from Constant Contact shows that 82% of small business owners cited referrals as their main source of new business. Affiliate marketers can do wonders for your business, but you need to be careful when deciding who to allow into your affiliate program. Wrong choices can cost you in terms of negative reputation, fake purchases and reduced profitability – ultimately husting your business credibility and your confidence. Offering affiliate programs makes sense for small businesses as they may not be popular enough in search engines to get organic coverage from websites and media publications.

But how do you choose an affiliate? Here are some common mistake to avoid:

COMMON AFFILIATE PROGRAM MISTAKES

You can always resort to affiliate programs when you’re not looking to spend too much on other forms of marketing, but make sure to avoid these mistakes:

1.  Choosing affiliates with good search engine rankings

You shouldn’t choose affiliate marketers that thrive in search engine results. While they do give a big boost to your sales and revenue, there’s a major drawback of selecting them over smaller affiliates – they can even outrank your business websites for the products and services offered. You may end up paying the affiliate marketer commissions for several years to come, sacrificing the chance to make real profits. That is the reason why choosing high-profile affiliate marketers can be a big mistake. There are reports on the web on how affiliates can outrank companies offering the actual products and services.

2.  Choosing affiliates blindly

You may not pay great attention to the experience of affiliate marketers because for you, the bigger picture is to increase sales in any way possible. However, offering affiliate programs to everyone can do more harm than good. Those affiliate marketers who’re just starting out may use spam techniques to promote your products and services. The spam techniques (buying traffic etc.) used can affect your business website indirectly (because the affiliate links that are a part of the spam ultimately lead to your website).

3.  Choosing affiliates that don’t understand terms and conditions

You should be very clear with the terms and services of your affiliate program. It’s important that you clearly mention the percentage of commission you’ll offer, the length of the cookie and the number of affiliate sales after the commission will be paid. The problem with allowing marketers who don’t understand your program’s terms and conditions is that they can retaliate and cause damage to your reputation. Rachel, a restaurant owner in North Carolina, NJ, accepted a blogger into her affiliate program. The blogger made 5 referrals, but wasn’t clear that the pay-out was after 10 referrals. The result was an argument and a negative review for Rachel’s restaurant.

Opening referral programs to affiliates can be a great way to increase your small business visibility. By avoiding the mistakes mentioned above, you’ll see more leads and conversions for your business.