Multi-level marketing (MLM) also known as network or referral marketing is a type of marketing strategy where a company encourages existing employees or distributors to recruit new employees for the sale of their products or services. In addition to the money made by existing employees on direct sales to customers, the existing employees are also paid a percentage of commission of their recruit's sale.
GoAffPro provides you with an option to have a multi-tier affiliate program, where commission gets distributed among the hierarchical referral network. You can set up multiple levels of affiliates, where your affiliates can recruit newer affiliates.
This helps in expanding your affiliate program. This lets you get more affiliates into your program.
For Example, here your affiliates can recruit sub-affiliates and those sub-affiliates further down recruit more affiliates. This creates a hierarchical network, where any referred sale down the line, commissions, or compensation is provided to affiliates up the line of the hierarchy.
To set up Multi-Level Marketing for your affiliate program, you can go to the Multi-Level tab in the admin panel.
Here you can enable the Multi-Level Marketing feature for your affiliate program by clicking in the enable button.
In the Multi-Level Marketing section, you can enable the Multi-Level feature, this will allow your affiliates to recruit sub-affiliates.
Here you will be able to see the network of your affiliates and sub-affiliates.
For Example, here "Affiliate Name" is the parent affiliate for "Sub-Affiliate Name". Therefore, any sale that takes place using the "Sub-Affiliate Name"s referral, the "Affiliate Name" will receive a commission on it as well.
The Levels and Commissions feature can be used to set up the number of tier and commission levels for affiliates. By setting up several levels, your affiliates will then be restricted to only recruiting sub-affiliates only up to a particular level and you can also set the commission rate for different levels to make recruiting sub-affiliates profitable for your affiliates.
To set up the level and commission for your affiliate program, click on Change.
In the Setup Commission Level section, you can set the number of levels of affiliates and the commission percentage for each level of the affiliate. There is also an example section, that will showcase, how the multi-level system will work with the level and commission rates you set up.
To set the number of levels, you can select the levels in the drop-down menu. If you set up 1 level, that will allow your affiliates to have sub-affiliates if you set the number of levels to 2, then your sub-affiliates can further recruit an affiliate and so on.
For Example, here we set the number of levels to 2.
We will have the Parent affiliate called "Partner 1" who will have sub-affiliate below him called "Partner 2" and further down we will also have another affiliate called "Partner 3."
In the Commission Per Level section, you can set up the commission rates for each level of the affiliate. Here we set up the commission rates for Level 1 as 10 percent and Level 2 as 5 percent.
If a direct sale takes place, where the referral used was of Partner 2, then Partner 3 will not be getting any commission, but Partner 1 will get the rate of commission that has been set.
If a sale takes place, where a customer makes a purchase on your store using the referral link of Partner 3, then Partner 3 gets the full commission on the sale, which here is $30. Partner 2 who recruited Partner 3 will receive 10 percent of the sale commission and Partner 1 who recruited Partner 2 will get 5 percent of the sale commission.
The Playground section can be used to test and learn, how an MLM network will work. The Playground gives you an option to first test out how the multi-level system you have set up, will work out for you. So that you can make suitable changes and tweak the system to work according to your preference.
Here the parameters we have set up are, number of partners in the chain (levels) to 3. The partner who's referral link was used to make the purchase is Partner C, we have two types of calculation methods, Dynamic and Simple, for this example, we will choose the dynamic calculation method. The commission for the sale is $100. Also, the commission rate that has been set up is 10 percent for Level 1 and 5 percent for Level 2 (you can set the commission rates in the Levels and Commissions section)
Here, we can see that the commission earned by Partner C who's referral link was used to make the purchase gets the full sale commission of $100. Partner B, who is the parent affiliate for Partner C will earn 10 percent of the sale commission, which is $10 and Partner A will get 5 percent of the sale commission which is $5.
In Simple calculation, the commission that Partner A and Partner B will receive will be calculated using the order value instead of the total sale commission. Here, we set the order value to $1000 in the parameters. Now Partner C will receive the commission according to the rate set for him but Partner B gets 10 percent of the total order value as commission which is $100 and Partner A gets 5 percent of the total order value as commission, that is $50.
In the Settings section, you have options such as the option to show the sponsor on the Signup Page of the affiliate portal, the sponsor is the parent affiliate who referred the potential affiliate to the create account page of your affiliate portal.
Here you can select, which Level Commission Calculation Method you want to choose. You can choose from the option of Dynamic calculation method and Simple calculation method. You also have the option to apply the Level Commission even when the sale commission is nil.
You can also choose to enable the multi-level network functionality by default in MLM Availability for Affiliates.