Why Affiliate Marketing Works
The single greatest opportunity the Internet has made available is affiliate marketing. It gives ordinary people a fantastic opportunity to earn additional income or in some cases their primary income! The entire structure of affiliate programs works like a treat for both the business and the affiliate and I can’t see any reason why anyone who doesn’t want to deal with running an actual business wouldn’t want to become an affiliate.
If you are new to the affiliate marketing concept, here’s a quick rundown. A business has a product or service to sell, and you have a related website or some other method of generating visitors which may be interested in the product. You send visitors to the business and if they end up making a purchase, you will be paid a commission. Simple!
Why Affiliate Programs Work For Businesses
- An army of “sales reps” at their disposal around the world.
- Potential reach to customers never thought possible.
- Minimal cost to set up and almost always returns a profit.
A business should never ever think that they are able to reach every single person who is interested in their product. Even if they rank in the top position for every keyword in the world, that does not equal 100% reach. Be careful not to fall into the belief that search engine traffic is everything - because it’s not. In fact, let everyone else get caught up in the hype about SEO and SEM whilst you go and work on alternate traffic source strategies. We’re not bagging SEO and SEM, it’s part of our business too but we see them as only a part of a larger cycle.
Let’s have a look at an example of how an affiliate program would suit a business. A business has a $10 product that costs $4 to produce. A typical sale would net them $6 profit. They are currently ranked #8 for keyword A and receive about 300 visits per day. Let’s have a look at the options they have for SEO, SEM, and affiliate marketing for this scenario:
SEO Strategy
Analyze the sites ranked higher than this one, optimize existing site and content, write new content, obtain relevant backlinks. Results to be seen over a longer period of time, may require structural and / or design changes to the site. Sites that are ranked above this site may be much further ahead in their SEO strategy and hard to compete with.
SEM Strategy
Do some keyword research, create optimized landing pages and start bidding on keywords through Google Adwords and other PPC networks. Can be very costly, require constant fine-tuning and no long-term gains for organic search.
Affiliate Program Strategy
Set out a commission structure, join a commission network and find publishers as well as going through sites ranked higher and lower than this site and approach the sites which are not competitors (i.e. not a business). Let the affiliates do the work, meaning the SEO and SEM on their own sites with their own time and money.
As I mentioned before, let’s imagine the website ranks #8 and receives 300 visits per day. Let’s say that three websites in the top 10 results decide to become affiliates of the business and started promoting the product. All of a sudden, the product has a 4 in 10 chance of being “seen” as opposed to a 1 in 10 chance. The maths goes a lot deeper than this but I am only giving a very basic example.
So as you can see from my very basic and limited explanation (I can’t be giving away too many strategies for free!) affiliate programs are an excellent method of promoting a product or service.
If you are interested in becoming a publisher, be sure to check out my post on making money through affiliate programs.
Businesses, hire us to consult on your website life cycle.
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Thanks for sharing the information. This is some really good stuff and many of us need to read this post….
September 12th, 2007 at 5:48 pm