How do you set affiliate commission rates?

Calculate gross margin per product group after cost of goods, shipping and expected returns. What you can spend on a channel is a share of that margin, not of revenue.

A simple rule: after commission, fees and variable cost you should keep at least the margin you accept on your other paid channels.

Thin-margin products deserve a lower rate; high-margin products can carry more. That steers publishers towards what actually pays.

For stock you need to clear, a temporary increase works better than a blanket discount that hits margin everywhere.

Content partners that create demand can earn more than voucher sites that appear at checkout. Put that in your terms rather than negotiating ad hoc.

A new-customer bonus steers towards growth instead of repeat purchases you would have had anyway.

What counts as market rate differs per country. German comparison sites expect different terms than Dutch content sites; Southern Europe sometimes runs higher rates on lower volume.

Check what competitors offer per market. You don't need the highest rate, but you do need a defensible one.

Review quarterly on margin and incrementality. Never cut rates without notice: partners plan content weeks ahead.

Announce changes at least 30 days in advance with an explanation. That costs you fewer partners than a silent cut.