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What is Affiliate Marketing?

Affiliate Marketing is kind of like being an independent sales representative in the online world - sans the telemarketing!

An affiliate marketer puts links and ads on their web site that are encoded with a specific tracking URL and Cookie. When a surfer clicks on that link and the click results in a purchase, a commission is paid to the affiliate marketer. The commission paid does not change the amount the customer is charged - the commission is paid by the merchant or advertiser.

Affiliate Marketing is different than pure advertising. Advertising is typically sold on a Cost Per Impression (CPM) basis. For every 1000 impressions (views), an advertiser pays a certain amount of money whether or not an actual sale is made. With affiliate marketing, the advertiser only pays when an actual sale is made.

Typically a unique URL is used to track when visitor has originated from an affiliate marketer’s site. Additionally, most advertisers also offer an “action period” - for a certain number of days after the first click, a cookie is placed on a surfer’s computer to continue to track the origination of the referral source. Affiliate marketers like long cookies - which means they will get credit for up to 4 months (sometimes even longer!) after the first click.

Affiliate links can be banner ads or text links. You can add them anywhere on your site you feel appropriate. Of course, if your page is covered with ads with no other compelling content, a surfer will have little reason to want to click on any of your ads. Affiliate Marketing works best when you offer resources for customers to make an informed buying decision.

Success Tips

Most successful affiliate marketing sites are review and content based. As an affiliate marketer, it’s up to you to educate and inform YOUR surfers/readers to help them determine what products and services are right for them. Here are a few good examples of very successful affiliate sites:

Rosalind Gardner got her start in affiliate marketing by finding a need and filling it. She entered the online dating scene in 1997, and didn’t really know which sites were the best, and which were ones to avoid at all costs. She learned by trial and tribulation which sites were the best and most reputable on the net. Then, realizing there were many other people who would want to know about what she learned, she launched - one of the first dating site review portals on the internet.

Sage-Hearts is a GREAT example of simplicity paired with great content, and her results prove it - based on her success in affiliate marketing, she wrote an eBook called How I Made $436,797 in One Year Selling Other People’s Stuff Online.

Another good example is Brad’s Deals - a coupon site with over 2500 Handpicked Deals & Coupons. Brad originally started the site to help his friends save time and money shopping online. Currently consumers using BradsDeals have spent over $100M at over 700 retailers - because he works constantly to update his site and he has a loyal customer base of his own that visit regularly to use his coupons (affiliate links with a built-in discount).

Affiliate Marketing works best on a site dedicated to affiliate marketing - such as above. It is less effective on blogs for a couple of reasons - most blogs offer free content (which predisposes our readers to expecting things for free), and most good blogs have what’s called a lot of “Leaky Links” - meaning links that send traffic away from your site without the potential to earn you $$ (non-affiliate links). This is a generalization, of course, so note that there will always be exceptions to this.

Skills Needed

To be successful in affiliate marketing, the following skills are needed - though you can rest assured you don’t need them all right now - some of them will simply come with time and experience…

Search Engine Optimization

Paid Search Engine Marketing

Sales Copywriting Skills (for reviews, informative articles, newsletters and other marketing materials. Head over to CopyBlogger to learn from The Guru on this subject)

Webmaster/html knowledge
A mailing list building strategy (very important!)

Working knowledge of spreadsheet programs and the ability to analyze costs vs. commissions

Ability to analyze web statistics on a basic level

Pros and Cons

Affiliate marketing can be extremely lucrative. It also can be built to the point where much of the business can run on autopilot, giving you a lot more time with the family. It can also be quite rewarding, knowing you are providing a valuable service to people who need the information you offer.

Affiliate marketing also requires patience. This is not an instant-get rich quick business. It takes time to learn what works and what doesn’t work - and to learn how to build up your own traffic (in order to send it elsewhere!). Time is the best teacher for affiliate marketing, as you can study what links your readers are most interested in (by tracking their clicks), where your traffic comes from (what keywords they use to find you), and what affiliate links convert to the most sales.

Income Potential

Don’t expect to earn much in your first few months in affiliate marketing, especially if you are only doing it part time. After the first year of persistent work, you can expect to see a steady revenue stream. I can’t say for certain, but from my past experience and that of others I know personally, I would say the low end of income potential is $10 K a year and at the high end the sky is the limit!

As with many businesses - you get out of it what you put into it. A six figure income from affiliate marketing is absolutely possible - and is also not the norm. In fact, there are a few seven figure affiliate marketers out there - so it certainly pays to learn the business!

Training or Certifications Necessary

No formal training or certification is necessary. Kids have made big bucks in affiliate marketing.

Sales Skills Necessary

You don’t need to do any in person presentations or make any sales calls. But you do have to write compelling sales copy, present product information in a clear to read and understandable format, make site navigation easy and intuitive, and handle customer service emails (sometimes your audience will have questions or problems with a merchant - while you can’t control what happens, you can yank links from your site, or add more based on what your readers like and dislike).

Remember – you are PRE-Selling for your advertisers – keep this in mind and your results will always be better than if you just throw links up on your site.

Initial $ Investment Range

It doesn’t take much $ to invest into creating an affiliate site. You have to pay for web hosting, and a solid email marketing/autoresponder tool (unless you know the CAN-Spam laws like the back of your hand are are willing to risk your email marketing business based on what you know). If this is your only source of income, then you need to plan for the time it will take to get your business up and running to a point that it will make you actual income (plan at least 4-6 months).

Also, PPC (Pay Per Click) traffic is quite critical to the success of an affiliate marketing site, so plan on opening an AdWords account and paying for some traffic.

Where Can You Learn More?

I’ve learned everything I know about affiliate marketing from two sources - I used to run the affiliate program for Socrates Media (from the Merchant side of things) and I read Rosalind Gardner’s book How I Made $436,797 in One Year Selling Other People’s Stuff Online from cover to cover. I really, really highly recommend it!! (Yes, that’s an affiliate link to her book and THAT endorsement is affiliate marketing in action!! ;) )

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Related Posts

  • The Startup Process is Slow Going
  • Affiliate Marketing 101: What is affiliate marketing?
  • Kris Jones on Affiliate Marketing
  • Building an Affiliate Web Site from Scratch

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    On November 22nd, 2006 at 9:05 pm, cjcm said:

    It’s funny, one of the things I had planned on my new website is about Affiliates Marketing, and just when I had started to put some thinking into it, its already elaborated here. Excellent!

    My favourie affiliate site is Allan Gardyne’s Associate Programmes. Will check out ur recommendations for more ideas.

    Care to share with us how much affiliate marketing contribute (in terms of percentage) to your total online income? A guestimate will do.

    On November 23rd, 2006 at 9:03 am, katiebird said:

    One of the things I always worry about — and it’s stopped me cold as I start to sign up for several, is a fear of leaving my social security number and other personal information too - with too many organizations.

    I try to tell myself that it’s not that different from applying for a job with these guys. I’d have to give that information to them then.

    But that fear of letting go of my personal information has kept me from making a serious effort.

    Also, my blog doesn’t get very much traffic at this point. And I’m not sure about how much money a health/nutrition blog could bring in. Would it be enough to justify the risks?

    I’m very interested in the process and wonder if I could be good at it. So maybe I should think creating another blog? It’s not like dieting is my only interest — far from it!

    This is a powerful post — it really has me wondering.

    On November 24th, 2006 at 1:11 pm, Stephanie said:

    Affiliate marketing is challenging but loads of fun for me. For those who don’t want to share their SSN, get an EIN for your business instead. Go to,,id=102767,00.html to read more about it.

    Mentions on other sites...

    1. eMoms at Home » Blog Archive » Diversify your Income in 2007 on January 4th, 2007 at 3:12 pm

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