How To Track Referrals And Calculate Commissions
Here are a few low-tech, easy-to-implement ways to track referrals for commissions without having to set up call tracking or an “official” affiliate program. My recommendation is to start with the ideas below. If you find that these methods are becoming inefficient because of the volume of leads you're generating, then upgrade to a more complex tracking system. A lot of people never start a referral (or affiliate) system because it can be too complicated to get started. Start simple and grow as needed.
Here are a few really easy ways to track referrals to calculate commissions.
Count The Bonuses
The best thing to do is have your client agree to give something to the people you refer. In addition to giving you your referral fee they also give the person you refer some sort of bonus as well. This could be a discounted price, an upgraded form of the service, or even a tangible item like a hat, mug, or t-shirt.
The bonus needs to be substantial enough for the person to remember to bring in the email or brochure you used to refer them. Or, if nothing else, they can mention that you referred them to get the bonus.
Then, at the end of the month, just count the number of “bonus items” that were given away and that’s the number of people you referred. Use that number to calculate your commission.
This works great for email drip campaigns that nurture leads. It’s also great for handing out brochures or flyers because those can easily be brought in to exchange for the bonus.
If people are registering/booking calls/signing up primarily online (including booking calls through Calendly) include a “coupon code” field in the sign-up form. When a coupon code is provided the person gets a bonus of some sort as described above. Depending on what the bonus is, you might want to label the text field something other than “coupon” if the bonus isn’t a financial discount. For example, you might call it the “free gift code” or the “free upgrade code.”
Then, to calculate your referrals, just count the number of times your coupon code was used.
Dedicated Landing Pages
In addition to the “count the bonuses” ideas above, you may also want to count traffic even if it didn’t result in an immediate conversion. It’s helpful to set up a dedicated landing page on your client’s website that only receives referral traffic from you.
For example, you might set up a link like:
Then you can track the traffic to that page to see how much traffic you’re driving.
You don’t have to set up a completely new page with duplicate content. You can use a URL shortener WordPress plugin like Pretty Links to redirect to a link using UTM Parameters to track where the traffic is coming from.
Using UTM Parameters
UTM Parameters allow you to track the source of inbound traffic without having to create dedicated pages. They are also a little more accurate than creating a dedicated page because organic traffic might hit a dedicated page if it gets indexed by search engines. But with UTM parameters, only people who click your specific link will register as traffic from your campaign.
UTM campaign parameters might be a little confusing to use at first because the names of the parameters are a little ambiguous.
Here’s how I use them:
Campaign Name: The type of bonus
Campaign Source: Where the traffic is coming from
Campaign Medium: What you’re using to reach people
Example: flyer (cpc, email, newsletter, organic-tweet, etc.)
Campaign Content: What thing/ad are people seeing
Campaign Term: How you’re targeting the audience
Example: organic (or keyword for paid ads)
Here’s a really good article with more information about what values to use for your UTM parameters.
A couple of things that I thought were confusing about UTM parameters at first were:
- You do not have to have BOTH a campaign_id AND a campaign_name (I just use campaign_name)
- You can use campaign_term to identify how you’re targeting your audience even if you’re not using keywords and paid traffic. For example, you can say “organic” or “affiliate” if you don’t have any keywords for your campaign.
How To Get UTM Links To Work In WordPress
There’s one little trick that will drive you nuts if you don’t know about it.
Put a slash before the question mark in the target URL.
If you don’t put that slash before the question mark WordPress will lose the UTM parameters during the redirect. That means Google Analytics won’t give you accurate stats on the traffic coming from your campaign.
If you’re using Pretty Links you can log into the WordPress dashboard and see how many clicks (and how many unique clicks) your referral link has gotten so you can see how much traffic your campaign is driving.
If you can’t (or don’t want to) do any of the above things to track your referrals, perhaps the easiest way to get paid a commission for your work is to measure the growth over some pre-defined baseline.
For example, if the client normally does $10k/month in revenue, you can set that as the baseline. Anything over $10k/month will be the value used to calculate your commission. So, if you’ve agreed to a 10% commission over a $10k/month baseline and they bring in $15k, then you get paid 10% of $5k which is $500.
The formula basically works like this:
(Monthly Revenue) – (Monthly Baseline) = (Commission Base)
(Commission Base) x (Your Percentage) = (Your Commission)
$15,000 – $10,000 = $5,000
$5,000 x 10% = $500
Even if you decide to calculate your commission off baseline growth, it’s still a good idea to put some tracking in place even if you’re just using UTM parameters. So, you can combine this method with some of the other ideas mentioned above.