S5E4 – Affiliate Marketing for B2B SaaS companies With Joran Hofman

Affiliate Marketing for B2B SaaS Companies: A Guide to Boosting Sales and Expanding Reach

Affiliate marketing is an invaluable strategy for B2B SaaS companies that want to expand their reach and increase sales. In this special episode, the host of this show Grow Your B2B SaaS Podcast, Joran Hofman, founder of Reditus, hosts himself to dissect the crucial topic of affiliate marketing. By leveraging third-party affiliates—such as influencers, bloggers, and consultants—companies can promote their products or services and pay affiliates a commission for driving conversions. This indirect marketing approach lets companies tap into new audiences and grow their customer base effectively. However, to succeed in affiliate marketing for B2B SaaS companies, you need a strategic approach and a clear understanding of the different types of marketing models, including referral, affiliate, and partner marketing.

Referral Marketing vs. Affiliate Marketing: What’s the Difference?

Understanding the distinction between referral marketing and affiliate marketing is crucial for SaaS companies. Referral marketing typically involves users recommending a product, often in exchange for non-monetary rewards, like extra features or storage. For example, Dropbox allows users to refer friends in return for additional storage space. Affiliate marketing, on the other hand, is performance-based. Affiliates earn a commission when their referral results in a paying customer, making it a revenue-driven model. Partner marketing, though related, often focuses on deeper relationships and shared success, rather than direct financial incentives.

Challenges in Setting Up an Affiliate Program for SaaS Companies

For B2B SaaS companies, setting up an affiliate marketing program isn’t a walk in the park. A common misconception is that affiliate marketing can be the primary method for acquiring customers in the early stages of a company’s growth. However, before tapping into affiliate marketing, companies need to build a solid brand, refine their sales funnel, and prove their value through direct sales. Affiliates are more likely to promote a SaaS product when they can see evidence that the company can convert leads into paying customers—after all, their earnings depend on it.

Additionally, affiliate marketing is not a “set-it-and-forget-it” solution. Much like SEO, it requires ongoing effort and attention to yield long-term results. Companies must actively recruit affiliates, provide them with marketing resources, and offer continuous support to ensure they are equipped to drive quality traffic and conversions.

Strategies to Grow Your Affiliate Marketing Program

To successfully grow an affiliate marketing program for B2B SaaS companies, start by identifying the right affiliates—those who already have access to your Ideal Customer Profile (ICP) and a strong understanding of affiliate marketing. Competitor analysis can also help identify potential affiliates who might be interested in promoting similar SaaS products. Another effective strategy is to activate your existing users as affiliates. These users are already familiar with your product and can be easily motivated to promote it to their networks.

Building a Strong Affiliate Program: The Role of a Dedicated Manager

As your affiliate program grows, having a dedicated person or team to manage it can significantly enhance its effectiveness. This role involves recruiting new affiliates, onboarding them, and providing ongoing support to ensure their success. By consistently engaging with affiliates and refining the program based on feedback, companies can build a robust network of advocates who generate high-quality leads and drive conversions.

The Future of Affiliate Marketing for B2B SaaS Companies

The future of affiliate marketing for B2B SaaS companies looks promising. Advances in data and technology will continue to improve targeting and engagement, allowing companies to reach their ideal customers more efficiently. Hybrid affiliate models—combining upfront payments with revenue-sharing commissions—can also offer more powerful incentives for affiliates. As the affiliate marketing landscape evolves, building trust and forming genuine partnerships will be key to sustaining long-term success and growth.

Conclusion: Why Affiliate Marketing is Essential for B2B SaaS Success

In conclusion, affiliate marketing for B2B SaaS companies is a highly effective way to drive sales, expand reach, and grow your brand. However, it requires careful planning, continuous effort, and a strategic approach to both finding the right affiliates and managing relationships. When done correctly, affiliate marketing can become a powerful channel to propel SaaS companies toward sustained success.

Key Timecodes

• (00:00) – Introduction: Selling Yourself First
• (01:03) – Joran’s Background and Journey to Reditus
• (02:13) – Understanding Indirect Marketing
• (03:29) – Explanation of Referral Marketing
• (04:46) – What is Affiliate Marketing?
• (05:55) – Partner Marketing Defined
• (07:06) – Common Mistakes in Affiliate Programs
• (09:18) – Affiliate Marketing: Not a Quick Win
• (10:18) – Importance of Onboarding Affiliates
• (11:25) – Strategies for Growing an Affiliate Program
• (12:33) – Competitor Analysis for Affiliate Recruitment
• (13:43) – Leveraging Keywords and Content
• (14:43) – Using Affiliate Networks
• (15:49) – Inviting Your User Base
• (16:55) – Responsibility in Affiliate Program Management
• (18:01) – Challenges in Growing an Affiliate Program
• (19:08) – Future of Affiliate Marketing
• (20:14) – Hybrid Deals and Long-Term Partnerships
• (21:24) – Advice for Growing a B2B SaaS Company to 10K MRR
• (22:33) – Moving from 10K MRR to 10M ARR
• (23:46) – Predicting Growth and Resource Needs
• (24:51) – Conclusion and Call to Action

Transcription

[00:00:00.320] – Joran

If you can’t sell yourself, then how can you expect somebody else to do it for you? It sounds super simple, but you need to be able to figure out things yourself first before you can ask somebody else to start recommending you. You can’t just hand people a link and expect that they know exactly what to do, right? Because often you have a certain brand or you have a certain style or certain features you want them to promote or a certain way you want them to promote you. If you don’t educate them on that, how can they promote you in the way you them to promote you? It’s not about the quantity, it’s about the quality of the affiliate. If you get the right affiliates in, and the right affiliates meaning they have access to your IDU customer profile, you’re going to have a lot more results at the bottom of the funnel. In today’s episode, we’re going to talk about affiliate marketing for B2B SaaS companies. For this one, I’m going to interview Joran Hoffmann, a. K. Myself. As you might know, I’m the founder of Redditus, an affiliate platform and network purely built for B2B SaaS companies.

[00:01:03.470] – Joran

Before starting Redditus, I worked at a company called Leadfeater, which is now DealFront, where I joined as a salesperson and left as the head of customer success. During this time, I also got to experience affiliate marketing as I was recommending the best sales and marketing tools as an affiliate myself via a site called saleslossmarketing. Co. As I experienced so many issues, I decided to build my own platform, and that’s where Reddit just got born. So this podcast is going to be a A bit different than normal, probably a bit shorter as well. I will be asking myself questions, and it will remain non-promotional and packed with value. Let’s just maybe just dive right in. Affiliate marketing is a form of indirect marketing. Let’s start at the really basics. What is indirect marketing? When you look at indirect marketing, maybe even start with direct marketing, you have defined your ICP as a SaaS company, so your ideal customer profile. If not, do so. With direct marketing, you’re going to go after them directly. You’re going to either run paid ads, you’re going to do SEO, you’re going to do cold outbound, you’re going to do things which allow you to reach your ideal customer profile directly.

[00:02:13.520] – Joran

With indirect marketing, there’s going to be somebody in between you and your ICP. It could be either an agency, a publisher, an influencer, a consultant. It could be anything, but you’re going to have somebody else recommending you. It’s going to be indirect. Who that should be for you or what fits, I think it’s really good to understand the differences between the different channels within indirect marketing. You’re going to have referral marketing, affiliate marketing, and then partner marketing. People have different opinions on what the difference is, but I’m going to explain mine, and then you can do what you want with it. What is referral marketing? When you, maybe even take an example, when you look at Dropbox, when I invite you to Dropbox, I didn’t have to leave the app to grab my link, which I can share with you. When you sign up to Dropbox, you get 10 gigabytes for free, but I also get 10 gigabytes for free. It already happened when you signed up. When you sign up via a link, which I grabbed in app, we both got in app benefits. So there’s no money involved. It’s purely in app. I couldn’t get the link without even signing up to Dropbox.

[00:03:29.390] – Joran

So that’s referral marketing. Often everything happens within the app itself. For users, I have to get benefits which are app-related. So next one, what is affiliate marketing? This is a bit different. Affiliate marketing is often purely based on revenue share. What that means is if I invite somebody towards a SaaS company, I don’t get anything when they sign up. I would only get something when they would actually move to a paid subscription. It’s paid per performance where the SaaS company says, You’re going to get 20% for 12 months of the revenue you deliver to us. If a client stays longer, I would still only get revenue for the rev share for the first 12 months. You will often use a third-party platform like ours or any other where people would sign up and grab their link from there. It also means that you’re going to go outside of your own network, so you’re not just going to purely focus on your users, but you’re also going to basically draw in people which are going to be outside of your own network, like influencers, bloggers, agencies, consultants, etc. Then you would have partner marketing. With partner marketing, it’s not always money-orientated.

[00:04:46.670] – Joran

Some partners are, but what you see as well is that if you have an agency, they don’t really care about the revenue share. They don’t really care about 12% or they don’t really care about 20% for 12 months. They just want their clients to be successful. With partner marketing, you’re going to have often a lot less, but they’re going to be a lot more engaged, like agencies, consultants, often being in this bucket where they already have contact with a set number of clients where they can recommend your tools towards them, and then they have a really warm intro to be done. But the best tools which work for this is where they trust you’re really going to deliver value. They would only recommend the tools they really believe in and they know it’s going to drive value for their clients. This is why they’re not always money-orientated because they want their clients to be successful, so they stay along with the agency. You can put this in a funnel where you’re going to have affiliates at the top. They could drive a lot of traffic because it’s going to be outside of your own network.

[00:05:55.110] – Joran

You could also invite your current users. It could be the biggest numbers in potential. Then you would have referrals or referrers for referral marketing. They’re going to be a lot less because they’re only going to be your current clients. There’s always going to be less than going us at your network. Then you’re going to have partners which are going to recommend you towards their current clients, which is going to be less as well. But also the more you move down in the funnel, the warmer the intro becomes. You want to decide for yourself what intros What do you need? What SaaS do you have? What are the average deal sizes? How long is the sales cycle? Then often you can already guess what is going to be the best channel for you to start. Cool. But today, we’re purely going to talk about affiliate marketing. Let’s start with the first question. What is the most common mistakes companies make while setting up an affiliate program? What I see a lot is that early-states SaaS companies think it can give them their first client clients, which is not going to be the case. If you can’t sell yourself, then how can you expect somebody else to do it for you?

[00:07:06.120] – Joran

It sounds super simple, but you need to be able to figure out things yourself first before you can ask somebody else to start recommending you. Let me give you an example. If a new restaurant would open up in your neighborhood, you’ve never eaten there, you don’t know what the service is, you don’t even know what the quality of the food is, would you be willing to recommend that restaurant to your friends? Probably not, If you have a restaurant where you eat regularly, you know exactly what the value is, you know exactly what food you’re serving, the service you’re getting, most likely that’s going to be a restaurant which you would be willing to recommend because you’ve been eating there multiple times. It’s the same with SaaS. If somebody doesn’t know what you’re actually doing, what value you’re offering, how would they be able to recommend you? So thinking affiliate marketing could be your first go-to-market channel, that’s wrong. Make sure you get users first. Make sure you start building case studies, best practices, figuring things out where people are left in the funnel, and optimize the entire funnel before you start asking somebody else to recommend you.

[00:08:13.060] – Joran

Because don’t forget Affiliate marketing is revenue sharing. Affiliates only get money when you turn their traffic into paid clients. If you don’t turn that traffic into paid clients, they would stop recommending you, and then in the end, that channel won’t work. So first misconception is thinking it can give you your first clients. It’s not going to work. Maybe there are some rare cases where it did, but I would not recommend it as your first go-to-market channel. Are you struggling to find people and companies which have access to your ideal customer profile? At Redditers, we just launched the second side of the marketplace, which allows you to search, filter, and contact B2B SaaS affiliates which have access to the audience you’re looking for. We do this by leveraging first-party data sources. Want to learn more? Go to getredditius. Com. Com. The second thing I see a lot is people think it’s a sit-back acquisition channel in a way, like a quick win magic bullet. If you do have revenue, if you do have users, if you do figure out your conversion rates, it’s not as simple as just setting up an affiliate program and things will just run by itself.

[00:09:18.830] – Joran

I like to always compare it to SEO. The more effort you put into it, the more results will compound over time. But at the beginning, you need to give us quite a bit of time and effort into it to make sure it’s going to compound over time because otherwise it’s just going to be sitting there at the back and it’s not probably going to do the results you’re hoping for. To give an example here, if you don’t invite affiliates, if you don’t recruit affiliates, if you don’t basically fill up the funnel, I guess at the top, getting people in to start recommending you, then you’re not going to get the results. The more time you put into actually getting them in, getting them onboarded and getting them activated, the more you’re going to get out of it at the end of the funnel. Maybe the other third mistakes I see a lot is that not onboarding the affiliates. You can’t just hand people a link and expect that they know exactly what to do right, because often you have a certain brand or you have a certain style or certain features you want them to promote or certain way you want them to promote you.

[00:10:18.390] – Joran

If you don’t educate them on that, how can they promote you in the way you want them to promote you? Definitely make sure you onboard the affiliates and, of course, qualify them based on certain criteria you set for yourself. Do you want to have a call with them? Do you automatically onboard them based on email sequences? You can treat it as creating your ideal affiliate profile or doing a qualification in there. Then with top potential ones, you You’re going to have calls with them where some of them, you’re just going to guide towards your self-serve affiliate sequence. Are there any strategies or processes companies are using to grow an affiliate program? To present. Then it starts with, again, top of funnel. So recruitment of the right affiliates. It’s not about the quantity, it’s about the quality of the affiliate. If you get the right affiliates in and the right affiliates meaning they have access to your ID of customer profile, you’re going to have a lot more results at the bottom of the funnel. So a couple of ideas you can already start doing or start checking out right away is, are your competitors running an affiliate program?

[00:11:25.590] – Joran

If they are, who are their affiliates? I can make videos on YouTube where you can see exactly who your competitor affiliates are. To give an example, you can just go into a tool like Semrush or Ahrefs. You can enter their URL and check for their backlinks. Then when you look at the backlinks, you can often already spot what is an affiliate link or not. When you start with this, you would have blogs or websites which are referring to your competitor, which means they’re going to have content for the topics you want to be ranking and they already know the concept of affiliate marketing. You don’t have to explain two things, like the problems you’re solving, plus you don’t have to sell them into the concept of affiliate marketing. If you want to have quick wins, this is your quickest win because you only have to convince them why they should also start recommending you next to your competitor. Don’t be afraid that they’re recommending our competitor, so they might not be recommending us, because what we see a lot is that they would have, for example, these Listing articles where where they would have the 10 best tools for XYZ.

[00:12:33.290] – Joran

If you want to get yourself listed in those articles, provide the content, make sure it’s just almost like a copy paste for them where they could just start adding you into the article, which is a good backlink for you, and they can start earning money without almost no effort. If you want to go one step deeper, think about what keywords do you want to rank for. If you are already running paid ads or are you doing SEO, you have certain keywords, you’re targeting, right? See if you can do a couple of searches. What are the high performing content articles based on the keywords besides, of course, the paid results besides the review sites, and then see who is ranking well for the keywords you want to be ranking for as well. Start reaching out to those blogs. Of course, if they’re not competitors because they already have content you want to be ranking for, why not add yourself into that? These articles might not always work purely on a revenue share model. Some of them would sell positions within the articles, but what you could do is try to figure out if you can work out a hybrid deal, meaning you would give them something upfront, but most of the money can be earned via revenue share.

[00:13:43.110] – Joran

You could say, We’re going to pay you $200 upfront to get our shelf listed into the article, and we’re going to give you 20% kickback fee for 12 months for every paid client you direct to us. These blogs, because they’re ranking pretty high on Google, which means they invested a bit of time and effort into ranking, they might not always purely go for a revenue share model. The more early stage you are or the less brand awareness you have, probably the more you have to pay upfront because, again, restaurant example, if they don’t know you yet, why should they start recommending you? The more well-known you are, the more likely they are to say yes. You have to play around a little bit what is going to work for you. The third strategy is to leverage a network with relevant affiliates. If you are thinking about setting up an affiliate program, make sure that you’re going to set yourself up for success longer term. You can set up an affiliate program with quite a bit of branding towards yourself in, as I call it, a silo approach where you have to invite all the affiliates yourself.

[00:14:43.530] – Joran

But at one point, you’re going to be limited Affiliate, as in if you are going to recruit affiliates, if you are going to invite your network, you’re going to try out at one point where it is going to be hard to keep filling up the bucket with new affiliates. But if you’re going to set up the program within the network which has access to affiliates you’re looking for. You can also kickstart the growth of the affiliate program. That’s definitely one thing I would recommend looking into. Can you share some best practices regarding setting up an affiliate program? We talked about already strategies and processes. One thing I haven’t discussed that much is inviting your own user base or your own network. When you really look at your own user base, and let’s get the restaurant example back, they know your value, right? They know exactly what you offer, what you to deliver, etc. Get them to start recommending you as well. Often what we see within the user base, you’re going to also have agencies or consultants already in there, or maybe people who do have access to your ICP, as in if there may be an influencer or they just have a huge following, try to see if you can activate them.

[00:15:49.240] – Joran

They might not always do it purely for the money, but if you don’t ask, you don’t know. See if they want to recommend you, what they want in return, and provide them with everything they need. The good thing is they already know exactly who you are, what you do, so they often don’t need a lot of guidance. I think that’s one thing. And then the other thing, best practice-wise, is if you have started to grow revenue for the affiliate program or you want to take it seriously, often you want to have somebody responsible for the program. So that is one of those things you’re going to add to somebody’s list. You want them to start recruiting affiliates, onboarding them, and then activating them. So they create this ICP, but then for affiliates, or like an ideal affiliate profile. Then you start figuring out, Okay, what do we want them to do? What would they need from us to actually do this? Is there a way we can make it as easy as possible for them? Then What can I do to help them make money? If you have a person who’s asking this question all the time to himself, What can I do to help these affiliates make money?

[00:16:55.300] – Joran

Then you’re going to have somebody who’s going to basically build an army of salespeople for you. But if you don’t have somebody responsible for the affiliate program, then often it’s one of those things which just don’t happen, which often means is you’re going to have a lot of dormer affiliates who just don’t know what to do or they signed up. You might have proved them like two weeks later, they forgot about it, and then they wouldn’t start recommending you. Rather, if you have somebody who accepts them almost right away when they come in, who would onboard them, activate them, and provide the content they need to start recommending you, then time to value for the affiliate is going to be a lot shorter because they might already earn their first commission within a month or within two months. So from there, they’re more likely to start promoting you on a longer term. So best practice, try to have somebody responsible for the affiliate program. This all sounds easy anyway, right? But there’s a lot of challenges and obstacles when growing an affiliate program. Let’s dive into the biggest challenge of growing an affiliate program. It will take time to get your first revenue in because we talked about recruiting affiliates, onboarding them, activating them.

[00:18:01.420] – Joran

It’s going to take time. They need to start promoting you. If they, for example, don’t have any content yet, they need to start generating content. That content needs to start generating traffic, and that traffic has to convert into paid clients. Look at your sales cycle. How long is your sales cycle typically? Then add some time to it. Reason being that, again, you need to recruit them. They need to start promoting. They need to sign up, and then from there, your normal sales cycle kicks in. So there’s just going to be a period before that. If you go and leverage the people who already know you, your current network, you can beat this up because they already know you and they hopefully already have a network they can start recommending you towards. There are ways of overcoming this, But this is going to be the biggest challenge. Getting your first revenue and after that it can compound. Don’t give up too soon. And make sure you actually put in the effort of getting the first revenue, because after that you can start treating it as onboarding new users to your SaaS, you can start building best practices, what affiliates are doing, and then from there you can educate the new ones coming in.

[00:19:08.020] – Joran

If you’re able to get over that first hurdle, things are going to be a lot easier. So a final question before I dive into the revenue-related questions. How do I see the future of affiliate marketing? I do think there’s a lot of challenges right now where sometimes you don’t know if an affiliate is a good fit for you or not. If affiliates sign up to a program, are they, first of all, really who they say they are? Do they have access to your ID or customer profile, aka what is their audience? And have they been generating paid clients for other SaaS companies? Often you don’t know these things, which makes it black box for a lot of SaaS companies and which makes it Super challenging. What I’m going to see, and this is maybe a bit promotional, sorry about that, but what we’re working on right now is that you want to know this information upfront from affiliates. When you have this information, you can even use affiliates to go into new markets. To give an example, if you have a network of affiliates, you can say, Hey, I want to see all the affiliates who have traffic in the US with a website with more than 10,000 visitors per month.

[00:20:14.120] – Joran

They’re interested in recommending tools within these industries. They purely work on a CPA model and have been generating money for other SaaS companies. You can even put a minimum on that. That’s what we’re working on right now, where you can almost start using them as a GTM-Motion. But again, not your first one, but for example, if you want to expand to new markets because you need to have a brand which is good enough for them to trust you. If you want to start selling yourself where they’re going to recommend you. You will need to have a good brand. It’s not just them recommending you, right? They need to want to start recommending you. For new SaaS companies, I think hybrid deals are going to be more and more applicable. Guess what you said, a lot of influencers get paid to do certain posts, and then it ends. I do think it’s going to be more strategic long-term partnerships where the hybrid deals are going to be covering the effort the influence has to do or the affiliate has to do up front. And then the revenue share is going to be the long term partnership where both of them are going to benefit if somebody delivers them paid clients.

[00:21:24.300] – Joran

Cool. Hopefully this was interesting. So let’s dive into the final two questions. So when we talk about growing a B2B SaaS company, what advice would I give somebody who’s just starting out and growing the 10K MR? The standard advice of growing to 10K MR is to hustle, do things that don’t scale, and talk to as much customers as possible. But that’s exactly what I would recommend others doing, and don’t skip this step. I think especially talking to a lot of customers is going to help you to build a strong foundation for 10K plus MRR. As you can learn from the challenges, build features just based on feedback, but also use the information in your sales process towards other prospects. Talk to as much customers as possible. You can’t talk to them enough. You’re going to learn so much from it. Talk to also prospects, customers, churn clients, learn why are they leaving, why did they actually sign up, why did they move to paid, what convinced them to do so. The more you talk to your customers, the more you can use it in your paid ads, in your SEO, on your website, in your sales pitch is basically anywhere.

[00:22:33.520] – Joran

It’s super important to actually, maybe even, first of all, validate the product you’re building if they’re interested into it. The biggest advice is talk to your customers. That’s it. What advice would I give somebody who’s passed 10K MR and now on their way to grow towards 10 million AR? So at Redditius, we’re on the journey ourselves, but with LeadFeed, our experience in journey while being head of customer success. So the advice I would give here is you need to build processes, but the fun part is build processes for the super long term because they’re going to keep breaking. So you need to start iterating them and ideally, even try to get ahead of things. If you’re able to predict what the revenue growth is going to be or you know what the revenue growth probably is, but then where is the revenue at a certain point, you can also start predicting what resources or people you would need. To give, for example, really practical example, I was able to predict, of course, with other leadership to see where the revenue is going to be in a number of months. Then we said, Okay, every CSM can take X amount of revenue or X amount of clients per person.

[00:23:46.620] – Joran

We were able to see where are we going to be in six months. When do we need somebody new? How long do they need to actually be onboarded for? We started hiring before that, taking into account found that somebody had to be onboarded. At the time, we were at that revenue point with the number of clients we were expecting. That person was already hired, onboarded, and ready to go. Often, you’re too late with certain things. The more you can get ahead of things, the better. It is hard. It is going to be trial and error to get there. But often, you can take a certain metric and then look at that, which is often revenue to see what would you need at that point. Cool. Hopefully, this was That’s really interesting. Thank you for watching this show of the Grow Your BDB SaaS podcast. You made it till the end, so I think we can assume you like this content. If you did, give us a thumbs up, subscribe to the channel. If you like this content, feel free to reach out if you want to sponsor the show. If you have a specific guest in mind, if you have a specific topic you want us to cover, reach out to me on LinkedIn.

[00:24:51.270] – Joran

More than happy to take a look at it. If you want to know more about Reditus, feel free to reach out as well. But for now, have a great day and good luck growing luck growing your B2B SaaS.

Meet the author

Joran Hofman

Back in 2020 I was an affiliate for 80+ SaaS tools and I was generating an average of 30k in organic visits each month with my site. Due to the issues I experienced with the current affiliate management software tools, it never resulted in the passive income I was hoping for. Many clunky affiliate management tools lost me probably more than $20,000+ in affiliate revenue. So I decided to build my own software with a high focus on the affiliates, as in the end, they generate more money for SaaS companies.