In this article, we’ll look at:
- What affiliate marketing is.
- The advantages and disadvantages.
- How much money you can make.
- How to get started.
What is Affiliate Marketing?
Affiliate marketing is where you act as a sales agent for another company.
It is one of the easiest ways to make money online. It is entirely legitimate and anyone can start doing it, anytime. For anyone who wants to start something above board, do something worthwhile, and create something of value then this is it.
Even if you have no idea about how to make money it does not matter. You can be successful by promoting other people’s stuff.
I am not sure who exactly was the first person, or company, to use the affiliate marketing model, but I know Amazon were big in its development and use.
They have managed to expand their business hugely off the backs of ordinary people who went out and sold stuff for them… and anyone using the Amazon platform as a storefront to sell stuff.
Big business aside, the key point is that now, it’s open to everybody.
It’s a low-cost business model that when done the right way, can be extremely profitable. All you really need is access to the Internet.
Advantages of Affiliate Marketing
1. You Don’t Need a Product
The main reason to make money with affiliate marketing is that you don’t need a product.
Many a person has come up with a great idea for a product, researched it, designed it and produced it. Then it hasn’t sold for one reason or another and they have gone bankrupt.
You don’t have that risk with affiliate marketing. You just research what is selling, and then get yourself between the vendor and the end customer.
After the sale is made, you get your commission.
2. No Customer Service
Another great thing about affiliate marketing is that you do not have to deal with any customer service.
If the customer is not happy with the purchase, for whatever reason, then they take it up with the vendor.
If they eventually get a refund then sure, you’ll lose your commission. But as long as you choose suitable products to promote (and you promote them in an honest way) then it shouldn’t happen too often.
Disadvantages of Affiliate Marketing
The downside to making money through affiliate programs is that you don’t control your own customer base.
Without your own product, it’s difficult to draw people back in and benefit from customer loyalty and repeat sales.
That being said, I think it’s a minor drawback.
The lack of need for a product removes the biggest barrier to entry for most people. And so, although it effectively increases competition for you, it still means you can start a business for minimal cost and at minimal risk.
Great! What Should I Promote?
You can find out what is selling from a number of different places.
All affiliate marketing programs will have rankings and favourites etc. where you can see what people are buying.
When you are thinking about what kind of things to promote, then you ought to consider something that you like. This will make the whole process a lot more enjoyable for you.
For example, exercise equipment may have a higher commission than say, make up. That’s great!
But should you dive straight in and try to promote treadmills?
Well, if you like make up, but cannot stand the thought of exercise, that might be an indication as to which way you should go.
You will have to produce some content that is themed to your chosen product category. Writing about something you like is much easier than slogging away trying to write articles on topics you don’t much care for.
Another factor in choosing what to promote is the amount of commission you make per sale. This is a performance based enterprise, so you should consider how much you need to sell, and what you’ll be paid.
How Much Can Affiliate Marketers Make?
Basically digital products will pay higher commissions than physical products.
If we just take Amazon as our starting point then (at the time of writing) the commission varies from 1% to 10% depending on the category of product that you sell.
For example, for every book that is bought through you as an affiliate, you will earn 4.5% commission. If you promote furniture then you will earn 8% commission per sale.
You can easily look at how much a product sells for, and do the math to determine how much money you will make. An expensive sofa might make you hundreds of dollars in commission, but you have to balance that out with sales numbers.
People don’t buy sofas as often as they buy books.
Digital products include:
- Video tutorials
They will tend to have the best affiliate commissions, much higher than physical products. Some digital products will pay 100% of the price to the affiliate.
It may seem silly, but it’s a loss leader where the vendor predicts that the lifetime value of the customer will exceed this initial loss.
Typically though, it will be 50% and when compared to physical goods, you can see why they are attractive.
Another good thing about promoting digital products is that new ones are constantly being launched. You will never be short of things to sell.
In addition, some digital products vendors will have an upsell in place. When a customer buys a product then they are immediately offered another complimentary product. Often the customer will buy, as they are in a buying mood. This increases your commissions.
And services that run a subscription model will also have a recurring element so you can make residual income.
You can find digital products to sell at places like Clickbank. You can browse their listings and choose something that is congruent with the kind of content you are producing.
How to Get Started in Affiliate Marketing
1. Build a Website
There is no getting away from the fact that you are going to need a website.
The best way to do this is to set up your own site, with your own hosting and your own domain name. This gives you far more freedom to work how you want to work.
It also gives you protection, in that no-one can shut you down and ruin your business.
There are affiliate programs that provide websites, but I don’t recommend these cookie-cutter options. If your website is the same as everyone else’s, then how are you going to stand out?
Understandably, this puts some people off initially, as they think “hang on, I thought was meant to be super easy, so why I am setting up websites and all that?”
It’s a fair point, but once you look into it setting up a simple website is, well, simple. So, it’s something you should seriously consider.
Note: A lot of people want to start affiliate marketing with no money, and there are other options open to you with the numerous free websites and or blog sites (Free site or not, blogging and affiliate marketing are great bed fellows). These will allow you to just post content on a sub-domain of their main site. You will need to check the terms and conditions, but most will allow you to use your site for commercial purposes. Almost certainly they will let you have advertising on it.
2. Add Content
When you get to building a website for affiliate marketing, you will need your own content (see below).
Depending on which affiliate marketing programs you sign up with, you will get access to a variety of marketing material. These will include banner ads and even entire articles.
As with my thoughts on using cookie-cutter websites, I don’t think using articles directly from the vendor is a good idea. Rewrite them perhaps, but don’t just reprint them on your site.
3. Add Links
Whichever service you choose to use, they will supply you with links to place at appropriate points on your pages.
When a potential customer clicks on one of your links they will go to the vendor’s site. But in the process they will get a cookie on their device that will signal where they came from ie. your site.
This line of code ensures that you get credited with the sale… and get paid.
Some programs will require approval and that often means being assessed by an affiliate manager. They may require you to have your own site already, especially for some bigger, well-known brands.
Website Content for Affiliate Marketing
Whatever products you choose, you will need to produce some content for the site to attract visitors. It’s the most common way that people will find your site… and be tempted to click on your links.
Most often affiliate sites come in two types:
Where the owner writes about a topic (health and exercise being very popular examples), and then uses the readers’ enthusiasm in the topic as an opportunity to suggest related products to them.
This is where being interested in the subject matter really helps.
If you are enthusiastic about your topic then you really can create a nice lifestyle for yourself as the whole thing won’t feel too much like work. You’ll just be writing about your hobby.
Where the affiliate marketer writes content and reviews about a certain type of product. Visitors to these types of site will more likely be in a buying mood and so getting them to click on affiliate links is easier.
Product review sites are a good way to set up an affiliate marketing operation as they can be really helpful to the customer. You can employ all sorts of styles to make them work including:
- Star ratings.
- Positives and negatives etc.
If you are going to write reviews, then you need to use the product, so you can discuss its pros and cons. If you are promoting expensive physical products, then this is going to be difficult and in many cases impractical.
It’s another advantage to promoting digital products in that you can email the vendor, explain that you want to be an affiliate for them, and ask for a review copy.
Everyone’s a Winner
I hope you can see how this is very easy to get into.
But at the same time, it can provide enormous value to the customer. And thus be extremely profitable for the affiliate marketer.
And let’s not forget the product vendor who essentially gets a load of people to sell for them… without paying a penny upfront.
Despite the fact that this is very simple to set up and can quickly be turned into a fully-fledged business, a lot of people still chase fairy tales.
A lot of people go after an online business by searching for a mechanical push button-type system.
As attractive as that it, following a system is often a busted flush. Everyone ends up trying to do the same thing and it dilutes the effectiveness.
All these types of short-term scheme fall apart in the end.
For example, when Google Adwords started some people bought ads and sent the person straight to an affiliate offer. It worked then, but Google shut it down.
Short cuts generally don’t work for long.
But, if you provide genuine value for the visitor, then you are not looking at things short-term.
If you can educate someone, and help them make a purchasing choice, and they end up happy with their choice, then you will succeed with affiliate marketing.
Are you thinking about becoming and affiliate marketer? Do you have a website? What would you like to promote? Please leave your comments below.