Affiliate Program

Affiliate Program

Overview

An affiliate program pays partners a commission for each sale they refer, making it a performance-based acquisition channel with no upfront media cost. The right setup depends on your platform — most merchants get 90% of the value from a dedicated app without writing any code. Custom commission rules, fraud detection, and automated payouts are where custom development adds value.

When to Use This Skill

• When launching a creator or influencer partnership program with revenue share
• When replacing a third-party affiliate network (ShareASale, CJ) to reduce 20–30% network fees
• When needing custom commission rules (category-specific rates, SKU exclusions, tiered volume bonuses)
• When fraud in an existing affiliate program is eroding margins
• When generating 1099 tax reporting for US-based affiliates

Core Instructions

Step 1: Determine the merchant's platform and choose the right tool

Step 2: Set up your affiliate app

Shopify

Using Refersion (recommended):

1. Install Refersion from the Shopify App Store
2. Go to Refersion Dashboard → Settings → General and configure:
   • Default commission rate (start with 10–15% for most verticals)
   • Cookie duration (30 days is standard)
   • Minimum payout threshold ($50 recommended)
3. Go to Commissions → Commission Groups to create tiers:
   • Bronze: 10% (default)
   • Silver: 12% (unlocks at $5k/month referred revenue)
   • Gold: 15% (unlocks at $20k/month)
4. Refersion automatically generates unique tracking links (yourstore.com?rfsn=XXXXX) and injects a tracking pixel at checkout — no code required
5. Go to Affiliates → Recruitment Page to enable a self-service signup portal where partners can apply
6. For Shopify Plus stores: use Shopify Flow to automatically tag high-value affiliates and trigger tier upgrades

Using UpPromote (free plan available):

1. Install UpPromote from the Shopify App Store
2. Go to UpPromote → Programs → Create Program and set commission rules
3. Enable automatic discount code generation for each affiliate under Settings → Affiliate Links
4. Connect PayPal or Wise under Settings → Payment for automated payouts

WooCommerce

Using AffiliateWP:

1. Install and activate AffiliateWP on your WordPress site
2. Go to AffiliateWP → Settings → General and configure:
   • Referral rate: 10% (start conservative)
   • Cookie expiration: 30 days
   • Credit last referrer: yes (last-click attribution)
3. Go to AffiliateWP → Settings → Payouts and connect PayPal or enable manual payouts
4. Enable per-product commission rates under Settings → Misc → Per-Product Rates — this allows you to set 4% on electronics and 20% on digital products
5. Install the AffiliateWP – Fraud Prevention add-on ($49) to automatically flag self-referrals and IP velocity abuse
6. Affiliates access their dashboard at yoursite.com/affiliate-area/

Tier automation with WooCommerce hooks:

// In functions.php — promote affiliate to Silver tier when monthly revenue > $5k
add_action('affwp_update_affiliate', function($affiliate_id) {
    $month_revenue = affwp_get_affiliate_earnings($affiliate_id, true); // current month
    if ($month_revenue >= 5000 && affwp_get_affiliate_rate($affiliate_id) < 0.12) {
        affwp_update_affiliate(['affiliate_id' => $affiliate_id, 'rate' => '12']);
    }
});

BigCommerce

1. Install Refersion or Goaffpro from the BigCommerce App Marketplace
2. Both apps integrate with BigCommerce's order webhooks automatically — no code required
3. Configure commission tiers and payout schedules in the app dashboard
4. BigCommerce's built-in coupon system works with both apps to generate affiliate-specific discount codes

Custom / Headless

For headless storefronts, use Rewardful (SaaS) to avoid building tracking infrastructure from scratch:

1. Add Rewardful's JavaScript snippet to your storefront
2. On purchase confirmation, identify the customer:

rewardful('convert', { email: order.customerEmail });

3. Rewardful handles cookie attribution, fraud detection, and Stripe Connect payouts automatically

If you need custom commission logic that Rewardful cannot handle, build the tracking layer:

// Track affiliate click and set cookie
export async function trackAffiliateClick(req: Request, res: Response) {
  const code = req.query.aff as string;
  const affiliate = await db.affiliates.findByCode(code);
  if (!affiliate) return res.redirect('/');

  await db.affiliateClicks.create({
    affiliateId: affiliate.id,
    ip: req.ip,
    clickedAt: new Date(),
  });

  res.cookie('aff', affiliate.id, {
    maxAge: 30 * 86400 * 1000, // 30-day cookie
    httpOnly: true,
    secure: true,
    sameSite: 'lax',
  });

  return res.redirect(req.query.redirect as string ?? '/');
}

// Attribute order and calculate commission
async function attributeOrderToAffiliate(orderId: string, affiliateCookieId: string) {
  const order = await db.orders.findById(orderId);
  const affiliate = await db.affiliates.findById(affiliateCookieId);
  if (!affiliate) return;

  // Fraud check: flag self-referrals
  if (order.customerEmail === affiliate.email) {
    await db.affiliateConversions.create({ orderId, affiliateId: affiliate.id, status: 'flagged' });
    return;
  }

  const commissionRate = { bronze: 0.10, silver: 0.12, gold: 0.15 }[affiliate.tier];
  const commission = (order.subtotalCents / 100) * commissionRate;

  await db.affiliateConversions.create({
    orderId,
    affiliateId: affiliate.id,
    commissionAmount: commission,
    status: 'pending', // hold for 30-day refund window
  });
}

Use Stripe Connect for payouts — it handles KYC, tax forms, and international transfers:

const transfer = await stripe.transfers.create({
  amount: Math.round(totalCommission * 100),
  currency: 'usd',
  destination: affiliate.stripeConnectAccountId,
  description: `Affiliate commission — ${month}`,
});

Step 3: Configure commission and fraud rules

Regardless of platform, configure these settings in your affiliate app:

1. Commission base: set commission on subtotal only — never on tax or shipping
2. Refund window: hold commissions for 30 days before approving (most apps call this "pending" status)
3. Minimum payout: set $50–$100 to reduce payment fees
4. Self-referral blocking: enable in app settings (Refersion and AffiliateWP both have this built in)
5. Category exclusions: exclude gift cards and already-discounted items from commission base
6. FTC compliance: require affiliates to disclose their relationship in all posts

Step 4: Measure performance

Track these metrics in your affiliate app's dashboard:

Best Practices

• Issue unique discount codes per affiliate (not just UTM links) — discount codes are more reliable for attribution when affiliates use link-in-bio tools that strip UTM parameters
• Hold commissions for 30 days before approving — never pay out on orders that might be returned
• Set a minimum payout threshold ($50–$100) to reduce payment processing fees and discourage fraud
• Require onboarding (PayPal email or Stripe Connect) before an affiliate can receive payments — this creates a paper trail
• Audit affiliates with refund rates above 15% — high refund rates combined with high volume signals return fraud
• Cap commission on first-time purchases only for high-discount categories — prevents affiliates from incentivizing repeat coupon use

Common Pitfalls

Related Skills

• @influencer-tracking
• @referral-viral-loops
• @sms-marketing
• @marketing-attribution-dashboard