Should You Start with Referrals or Affiliates First?

Written by Joran Hofman, Founder of Reditus

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Our advice: don't pick one. Launch your in-app referral program and your affiliate program together, and start with your own network. Your users go into the in-app referral program. Consultants, agencies, partners and others who already know your product and reach clients in bulk go into the affiliate program.

Older advice, including an earlier version of this article, said to start with referrals and add affiliates later. That advice dates from when the in-app referral program was part of a free plan, which no longer exists. Today Growth, our entry plan, includes both programs, so there is no reason to run them one after the other.

Who goes into which program

Your users go into the in-app referral program. They already know what your product does for them, so they need little convincing. You reward them with something that fits your product: credits, an extra trial period, a discount, money, or anything custom you grant through webhooks.
Consultants, agencies and partners go into the affiliate program. They reach clients in bulk and earn a recurring commission on the customers they bring, often in a private tier with a deal that fits their role. That includes agencies and consultants who use your product themselves.
Don't push partners into the in-app referral program. For them a referral reward is a one-off benefit, and the economics are wrong.

Why start with your own network

Think about opening a restaurant. It is very hard to get people who have never eaten there to recommend you. People who already ate there know the food and the service, so they need little guidance to start recommending you.

Strangers first have to find you, understand what you do and ideally use your product before they create content about you. That takes much longer. It is also where many SaaS companies go wrong: they set up an affiliate program and expect people who don't know them to apply and start recommending them right away.

Your first hour and your first week

Set up your programs (hour one). Decide how much commission you give away and for how long, choose the reward for your users, and fill in the company details Reditus needs for your program's landing page.
Install tracking (still hour one, or day one). The tracking script, the signup snippet and your payment connection: Stripe, or the Payments API for any other processor. Both programs run on this same installation, and a typical technical installation takes under 30 minutes.
Invite your own network (week one). Put the referral widget in front of your users, and invite your consultants, agencies and partners into the affiliate program.
List in the marketplace in parallel, never instead. A marketplace listing needs Scale Up or Enterprise on an annual commitment plus a completed installation. It brings inbound requests from the Reditus network of 28,000+ B2B SaaS affiliates, but it does not mean you can sit back. Break the ice with your own network first.

Then go beyond your own network

Once your own network is in, look for the affiliates who already recommend your competitors with an affiliate link. They know your market, already have content that ranks and know how affiliate marketing works, so they are a much easier yes than people who have never written about your space. Five of them are worth more than 50 affiliates who never heard of you.

The Affiliate Finder shows you who they are, on every plan. During the trial you see the 10 best leads; paid plans show every lead.

Are you ready for either program?

Both programs need paying customers who like your product. As a rough bar, think of around $10K MRR with product-market fit. Below that, people usually won't recommend you yet, and affiliates can't earn if nobody pays. If you are earlier than that, grow with your own users and network first. Growth is built for exactly that. More on the readiness bar in when should a SaaS launch an affiliate program?

When both programs run, who gets the credit?

Both programs use the same tracking script and the same cookie. Attribution is last click: if someone clicks an advocate's link and later an affiliate's link, or the other way around, the later click overwrites the earlier one. Once the person signs up, the referral stays with whoever had the last click and is never reassigned. Details: can you run referrals and affiliates together?

FAQ: referrals or affiliates first

Isn't an in-app referral program easier to start with?

It is quick to set up, but so is the affiliate program: both run on one installation, and Growth includes both. If you start with referrals alone, you leave out the people who can bring you clients in bulk. Agencies and consultants who already use your product are often your quickest early wins, because they implement the software for their clients.

Can I launch the affiliate program first and add referrals later?

You can. But the in-app referral program comes with every paid plan, so there is little reason to wait. Your own users are often your best marketing channel.

Do I need a marketplace listing to get started?

No. You can start on Growth with your own network and the Affiliate Finder. A listing (Scale Up or Enterprise on an annual commitment, plus a completed installation) adds inbound requests from the network and typically shaves 4 to 8 weeks off the recruiting phase, compared with recruiting everything by hand.

How big should the rewards and commissions be?

For users: big enough to matter, because tiny rewards don't make people recommend a friend. One Reditus customer pays €150 for every new paid client a user refers, and it has worked really well. For affiliates, commissions usually sit between 20 and 50%, with early-stage companies paying more and for longer. Check it from the affiliate's side: your average deal size times your commission should give them roughly $10 or more per customer payment.

What does it cost to run both?

Both programs are included in every paid plan. Growth starts at €99/$99 per month billed annually (€149/$149 billed monthly). You can set up both programs during the 14-day free trial, no credit card needed: start your trial.

Want to know when your first affiliate revenue could come in? It depends on your trial length and how you recruit: the affiliate revenue timeline calculator estimates it for your situation.