Affiliate Marketing is the first step to a full time living online for many people. The reason it’s a popular starting point is because it’s incredibly easy and, if done right, can be very profitable. It’s a great way to come to terms with what internet marketing is all about, how and why people spend money online, and to get an idea of markets and other ways of making money.
The basic idea behind Affiliate Marketing is that you sign up to a product, site or service, after which you get a referral link which offers the product or service, sometimes at a discounted price. If the visitor decides to buy the product, you receive a percentage of the sale.
How Much Is It Worth?
The success and profit of affiliate marketing can be worked out in exactly the same fashion as Cost Per Click Advertising using 3 factors: The amount of traffic, the value of the product and the conversion rate. The amount of traffic is pretty straight forward; it’s the amount of people who visit your affiliate link per day. The value of the product is simply how much money you get from each sale. If the product is $40 and you get 50% of the sale from referrals then the value of the product is $20. Finally the conversion rate is how many people actually buy the product, expressed as a percentage of the amount of people who visit your affiliate link. So if 100 people visit your link per day and out of those 100, 7 people continue through and spend their $40, your conversion rate is 7%. Most of the major Affiliate Marketing sites will show your conversion rate in real time.
If you’re not part of ClickBank or any of the major affiliate sites, you can work these values out by putting a hit counter like Google Analytics (http://www.google.com/analytics) on your site and seeing how many hits per day or week you receive. Then simply work out how many sales you make per day or week from your link and from this work out your conversion rate. The value of any affiliate product or link can be expressed as Profit = Traffic x (Conversion/100) x Value. Therefor if you post an article with a link to an Affiliate product which costs $20 and you get 50% the value is $10, if you receive 80 hits per day to that page and your conversion rate is 5% then Profit = 80 x (50/100) x $10 which is $400 per day.
You can expect to make a reasonable income from affiliate marketing, though perhaps not as much as other revenue streams can bring. Again, affiliate marketing is very simple and acts as a good introduction to the world of internet marketing but as soon as you work out the basics and have made a few dollars, you’ll probably want to cross the fence to the other side of affiliate marketing and instead create products for others to sell.
How Much Work Is Involved?
Creating an affiliate link is the simplest thing in the world and signing up to ClickBank or a specific affiliate product will take minutes. The real work is in driving traffic to your affiliate links. There are many ways to do this but the most popular is by blogging. By choosing a specific topic to Blog on, say Running Shoes, you can write just an article or two per day then insert a few affiliate links into your articles for whichever products are most relevant to that article, be they running shoes themselves, an e-book about running, or whatever.
An excellent technique which is often overlooked is to write reviews of products. This is useful because if you can get hold of the product and use it, you can simply write your opinion of it and perhaps add your own ideas. This means you can generate lots of articles without having to think about it too hard. The other benefit is that these articles, if you title them accordingly, “Nike XG Running Shoes: Reviewed”, for example, you will attract a certain type of visitor: people who already want to buy the product. These people are looking for information on the product in order to make an informed decision on whether to buy it or not. If your article provides some good and honest (don’t just write positive things) information about the product and then provides a link to buy it, the customer is likely to trust you and follow your link.
You can also use this method to attract customers to your products by writing about other products. Say you have an affiliate link for Nike XG Blue Shoes but customers are searching and buying Addidas PW Red Shoes. Simply write an article with a title something like “Addidas PW Red Shoes – Are They Really Worth It?”. Then continue to write up a short review, but lead this on to your own product with something like “while Addidas PW Red Shoes are great for short bursts, I found that Nike XG Blue Shoes were much more comfortable and suited me a lot better for long distance running.” Again, add your affiliate link somewhere in the second half and people who are already in buying mode (they were searching to buy Running Shoes) have a review of the product they were searching for, as well as a seemingly better product, along with a link to buy it.
Links
ClickBank (http://www.clickbank.com) is the big daddy of the affiliate marketing world and has been the most profitable for both publishers and affiliates for a long time. It has some excellent statistics and some links will net you up to 95% of the value of the sale.
PayDotCom (http://www.paydotcom.com) is another popular and large affiliate network which has many real products as well as digital ones.
Click2Sell (http://www.click2sell.eu) is yet another and is set up in much the same way.
You can discuss this article and see what others are saying about it in the Make Money Online Discussion Forum
Did you find this article useful? Why not buy Sean a coffee?
5 comments ↓
Great information. It’s time for any individual to grab this thing and get easily earn money. But first understand how affiliate marketing really works.
Very good article. I might put it into use myself. It really is understandable and I think that anyone looking to earn cash might like this. Of course, I agree with the previous commenter to read up as much as possible on the subject to understand it fully.
Affiliate marketing is definitely a lucrative source of cash on the web. It does require a bit of hard work at first but when everything established, one can literally expect lots of cash flowing from it.
It’s harder to make money out of affiliate marketing than from AdSense, but when you get the hang of it, there’s real money.
You just have to push it hard enough.
Please correct my name on my previous comment, it’s “Chip”.
Thank you.
Trackbacks
Leave a Comment