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

Platform	Recommended Tool	Why
Shopify	Refersion or UpPromote (Shopify App Store)	Native Shopify integration, automatic coupon + link generation, built-in fraud detection, PayPal/Stripe payouts
WooCommerce	AffiliateWP ($149/yr) or Solid Affiliate	Deep WooCommerce integration, per-product commission rates, real-time reporting, Stripe payout add-on
BigCommerce	Refersion or Goaffpro (BigCommerce App Marketplace)	Native checkout integration, multi-tier commissions, real-time dashboards
Custom / Headless	Rewardful (SaaS, $49/mo) or build custom with Stripe Connect	Rewardful handles tracking, fraud detection, and payouts; use custom code only for complex commission logic

Step 2: Set up your affiliate app

Shopify

Using Refersion (recommended):

Install Refersion from the Shopify App Store
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)
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)
Refersion automatically generates unique tracking links (yourstore.com?rfsn=XXXXX) and injects a tracking pixel at checkout — no code required
Go to Affiliates → Recruitment Page to enable a self-service signup portal where partners can apply
For Shopify Plus stores: use Shopify Flow to automatically tag high-value affiliates and trigger tier upgrades

Using UpPromote (free plan available):

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

WooCommerce

Using AffiliateWP:

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

Install Refersion or Goaffpro from the BigCommerce App Marketplace
Both apps integrate with BigCommerce's order webhooks automatically — no code required
Configure commission tiers and payout schedules in the app dashboard
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:

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

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

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:

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

Step 4: Measure performance

Track these metrics in your affiliate app's dashboard:

Metric	Target	Where to Find
Click-to-conversion rate	2–5%	Refersion: Reports → Conversions. AffiliateWP: Reports tab
Average commission payout	Track vs. ROAS	Affiliate app → Payout reports
Fraud rate (flagged conversions)	< 2%	Check flagged/pending queue monthly
Top 10 affiliates by revenue	—	Affiliate app → Leaderboard

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

Problem	Solution
Self-referral fraud	Enable self-referral blocking in your affiliate app settings; most dedicated apps include this
Commission calculated on full order total including tax and shipping	Configure the commission base to use subtotal in app settings
Payout fails for affiliates who haven't completed KYC	Gate payouts on completed onboarding; use Stripe Connect's `charges_enabled` status check
Tier not downgrading when affiliate volume drops	Review tier assignments monthly; most apps support manual tier adjustments
High refund rate from one affiliate	Pause the affiliate and review recent orders; if pattern continues, terminate partnership

Related Skills

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

affiliate-program