Affiliate marketing programs pros and cons

Affiliate marketing programs pros and cons

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I. Affiliate marketing guides

Ever wonder how to cash upon the traffic on your site? Well, there are a number of ways to do it, however, we will focus on one effective and popular way right now – Affiliate Marketing.

What is Affiliate Marketing?Affiliate marketing is a method by which you earn from the sales made of some other products through your website. Sometimes you are even paid for the traffic you send to the product’s site from your site. You send traffic to the product’s site and if the transaction is completed, you get an appropriate commission from the sale. If a number of sales are made during a day, both the affiliate and the merchant can make a lot of money.

The benefits of affiliate marketing are that you don’t have to own a store, deal with merchandise or even transactions. There is no investment at all and you can make money just by sending the client to the merchant. The benefits for the merchant are that he doesn’t have to pay the affiliate unless the affiliate brings business to him. It’s a complete win-win situation for both merchant and affiliate.

In 2006, an estimate of US$6.5 billion was earned by the affiliates worldwide as a commission, and the figures are expected to increase each passing year.

Pros of affiliate marketing:

Ease of setting up – To become an affiliate, you just need to choose a product/service, sign up at its affiliate program (you might be asked to fulfill a few formalities) and paste the tracking code on your website. You’ll be making money from all the sales you make through your website from that point onwards.

Minimal marketing skills required – if you don’t belong to a marketing background or are not good at selling to people, you can still earn a lot from affiliate marketing. All you need to do is to concentrate on your real skill i.e. successfully running your website. If SEO (search engine

Performance review phrases comments/ free download examples Page 1

optimization) is what you are good at, you can just concentrate on that and leave the marketing, sales, transaction and even legal issues for the merchant.

No investment – signing up for an affiliate program does not cost you anything and banking upon that program costs you just a little bit of your time and skill. Thus you can be an affiliate without any investments and even move to any other area, if that one doesn’t work out, without any loss.

Multiple areas of income – once you are familiar with the whole affiliate marketing process, you can apply your skills to other areas too. You can apply for as many affiliate programs as you wish and earn from different sources.

Automatic income generation – once you have a successfully running website, you can just relax and watch your bank balance grow automatically on each sale made through your site. You work on your own conditions and work comfortably at home.

Cons of affiliate marketing:

No control over programs – you don’t have any control over the programs offered by the merchant. If the competitors are offering better prices or services, you cannot do anything but wait for the merchant to change the offer. Also, you have the same offer as thousands of other affiliates, which make it difficult for you to stand out.

High competition – one of the pros of affiliate marketing is that it is really easy to sign up for a program, and so is it for everyone else. There are thousands of affiliates for the same program across the globe and the level of competition is really high. You are even competing against high skilled SEOs whose expertise is in generating traffic.

Pay on sale – this is the biggest advantage for the merchant and a disadvantage for the affiliate. The merchant only pays you when you make a sale through your website. This transfers all the marketing risk to you. You may send a lot of traffic to the merchant, but if the merchant loses the sale because of a bad offer, you don’t earn anything too. Thus, you pay for the merchant’s faults.

Middlemen – in affiliate marketing, you also have to pay a share of your revenue to the middlemen, the biggest one being the affiliate network. The affiliate network links the affiliates with the merchant and also provides a number of reporting and tracking tools, but you pay them from the revenue you generate through sales. They also reduce the contact level affiliate has with the merchant.

All the cons above, however, can be resolved by the method of direct partnership. Through direct partnership with the merchant, you contact the merchant directly, cut out the middleman and leave more profit for the affiliate.

How do you go about a direct partnership?First, you need to choose an area which has a good potential for high returns and less competition. Then jot down a list of merchants in that area and contact the appropriate merchant directly. Most of the merchants will entertain you properly provided you can demonstrate potential traffic and sales level. Suggest a trial run to prove yourself, and once you prove yourself, negotiate with the terms and conditions. If the merchant still turns you down, go to his competition merchant and make the same offer.


A direct partnership brings transparency between you and the merchant. Since you have a close relationship with the merchant, you can also participate actively in changing the offers and services in order to remain competitive.

Thus, affiliate marketing can earn you a handsome living through your website, if implemented properly. You just need to be patience as it takes time for a business to grow and not lose hope if one program doesn’t work out for you.

II. Affiliate marketingstrategies

Affiliate marketing is a low-cost way for merchants to build awareness and showcase their products and services. The model is simple; it works as a commission-based referral system. A partner or affiliate markets a merchant's products for a "piece of the pie."

Affiliate marketing experts often make an income that can tally over five figures per month, however only 1 to 5% of thousands of marketers achieve this level. When an affiliate reaches this elite level they are often referred to as a "super" affiliate.

How does one become a super affiliate? Can anyone do it? Super affiliates have common tactics that they embrace and put into place. Anyone can become a super affiliate, but it will not come without blood, sweat, and a hefty time commitment. The typical super affiliate possesses the following traits:

Persistence

Patience

Thirst for Knowledge


These three traits combined with the following strategy gives you the formula for the makings of a "super" affiliate.

1. Find a Unique NicheThe mistake that many affiliate marketing hopefuls have in common is that they try to offer everything under the sun rather than focusing on a specific niche market. Do not scatter your efforts, focus on your niche, promote it, and sell it well.

2. Search Engine MarketingOnce you've built your affiliate storehouse you will need to promote it. Many affiliates use pay-per-click engines. I suggest that you learn how to achieve organic search results or hire a search engine marketing company. This will save you from spending all your profits on pay-per-click engines. Only use pay-per-click engines if you know what you are doing, otherwise all your profits may end in the hands of Google Adwords or Overture.

3. Know Your Product, Know Your AudienceCreate a resource. By taking the time to learn about the products and/or services that you are offering you can create information that builds your credibility. That credibility builds trust. If your viewers do not have trust in you more than likely they will not purchase from your storehouse. If you want more information on the psychological process that an online buyer goes through I suggest that you read my article on the Five Levels of Internet Marketing and the Sales Process. This will help you in creating a web site that converts well, which in return will increase your cash flow.

4. Don't Put All Your Eggs in One Basket

Promote products from different merchants. This way if you have a problem with receiving payment from a merchant, or their products do


not convert well the effects on your business will be minimal. Watch out for exclusivity agreements; remember this is your business. Protect yourself and diversify so that you do not feel the famine effect if something goes wrong. There is absolutely nothing wrong with promoting niche products from different merchants.

5. Seek Knowledge and Embrace Change

If you are familiar with Internet marketing at all you know that what worked three months ago may not work today. Stay on top of the trends. Seek knowledge, start by learning something new about affiliate marketing daily. For example remember those marketing tools called "banner" that use to drive sales at an astronomical rate a few years ago? Well those banners developed a term called "banner blindness." That means most online viewers will not click on banners even if they do pertain to what they are looking for. To be a "super" affiliate you must always spend time reading, learning, and embracing the changes in Internet marketing.

6. Don't Give Up

It's hard to do, and most of the time those dabbling in affiliate marketing give up way too soon. Monitor your statistics, watch to see what is working and what is not. Make changes when necessary. Do one thing daily to promote your storehouse and be patient. Before you know it you will start getting payments.Remember that it will not happen overnight. Encompass and develop the persistence, patience, and knowledge. Then follow the tactics I've mentioned above and you are on your way to becoming a "super" affiliate.


Education

Affiliate marketing programs pros and cons