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Affiliate Revenue Information Channel:
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Place your TextLink AD here free
"Where is all the help I'm supposed to get. I have been buying ezine and classified ad builders and signing up for Echecks and Virtual credit cards. In the meantime I have no business and no ads set up. When does all this happen? Let's go here. I spent all day on this. I'm running out of time."
I kid you not, this is the sum total of an actual email that hit my inbox this week. Not only did I not know this person from Adam, this was the first and only email I had ever received from her and to this day, I have no idea what she's talking about. Presumably, she signed up for one of the affiliate programs I promote from my site and was asking, in her own inimitable style, for my help. Although I am always ready and willing to help anyone I can, this is most definitely NOT the way to go about asking for it. Needless to say, I let her know what I thought of her approach in NO uncertain terms.
The attitude displayed in this person's email to me (and she is by no means an isolated example) exemplifies why so many people fail to make a success of their online businesses. Leaving aside the utter rudeness of the approach, notice the impatience, the expectation to be up and running in a day, the HURRY, the apparent belief that real world principles such as courtesy and good manners don't apply online (they do). Think this person is going to last the distance? What kinds of tactics do you think she is capable of resorting to in pursuit of the almighty dollar?
So, let's take a realistic look at affiliate programs, what they can and can't do for your business and how to maximize your chances of creating a successful, long-term business with them.
WHAT IS AN AFFILIATE PROGRAM?
An affiliate program (also known as a reseller, associate, referral or partnership program) is essentially a revenue-sharing arrangement whereby you, the affiliate, receive payment from the owner of a product or service that you promote on their behalf.
Affiliate programs are an excellent way for the new internet entrepreneur to start an online business.
TYPES OF AFFILIATE PROGRAMS
There are various types of affiliate programs.
The most simple involves you, the affiliate, placing a banner ad, graphic or text link at your site which is linked to the site of the business you are promoting. This link is coded with your unique affiliate ID so that the site visitor is recorded at the target site as having originated from your site, thereby allowing you to be credited with the sale.
Payment is generally a fixed percentage of the sale value (commission) or "pay per click", where the affiliate is paid a certain amount for every time a site visitor clicks on the link at the affiliate's site, whether or not a sale is made.
The more sophisticated affiliate programs are multi-tier and allow the affiliate to earn commissions not only on the traffic they directly refer to the target site but also a proportion of sales generated by their sub-affiliates.
BENEFITS OF AFFILIATE PROGRAMS
The greatest benefit of affiliate programs is that when you are just starting out in your own online business you don't have to worry about creating your own product or service. You just promote someone else's and get a share of the revenue pie for your efforts.
You also don't have to concern yourself with warehousing, transport or logistics headaches. All of this is handled by the business who'se products/services you are promoting. All you need concentrate on is driving traffic to that business's website. This means that a high proportion of your revenue is profit.
The owner of the product/service is also responsible for collecting payment, customer service and the myriad other details that come up on a day to day basis in running the business.
DISADVANTAGES OF AFFILIATE PROGRAMS
The main and obvious disadvantage of affiliate programs is that it is the owner of the product/service who earns the lion's share of the profit on the sale.
You're working on commission. You will NEVER earn by way of affiliate program commissions as much as you can earn by way of profits from producing and selling your own product/service.
As a result, affiliate programs represent a high opportunity cost when you consider what you could earn if you instead channeled the time and energy you spend on promoting affiliate programs into creating and promoting your own product/service.
For this reason, it does not make sound business sense to rely solely on affiliate program income for the longer term growth of your business.
Instead, think of them as a way of dipping your toe in the water when you're first getting started, and a nice little sideline once you've created your own product/service. Do NOT build your business around affiliate programs with the intention this will always be the backbone of your business. You'll be stunting your own growth if you do.
CHOOSING THE RIGHT AFFILIATE PROGRAMS FOR YOUR BUSINESS
So, keeping in mind what affiliate programs can and can't do for your business, let's turn to what you should look for when choosing an affiliate program or programs to promote in your business.
=> Synergistic Products/Services
First off, and this is a cardinal rule, only promote those programs which will allow you to create synergies with your site. This means selecting programs that naturally complement the subject matter of your site and that will therefore be of interest and relevance to your site visitors. This will ensure your prospects (ie your site visitors) are pre-qualified which will result in a relatively higher conversion ratio (the ratio of visitors to purchases) than would be the case if your traffic is untargeted (which will be the case if you promote unrelated products and services from your site.)
=> Quality In All Things
Keeping the need for synergy uppermost in mind, look for quality programs first and foremost. The last thing you want to waste your time, money and reputation on is a shoddy product or service. There are just too many quality programs out there to settle for anything less.
=< Stability of Company
Look for a company that's been around for a while and that's reputable and stable (both financially and in its management). Any reputable company will have full contact details readily available so do your research.
=> References
Look for testimonials and references from other affiliates. If the company you're interested is not forthcoming when it comes to putting you in touch with other affiliates, move on.
=> Affiliate Agreement
Look for a professional, considered and detailed affiliate agreement (contract). This shows that the company is serious about its business.
Watch out for exclusivity clauses and other restraints. Some affiliate agreements will require that you not promote competing businesses' products and services. This is not to say you should avoid such agreements. As a general rule, it is your interests not to promote competing programs anyway. Just be aware of what the agreement says on the subject to avoid getting yourself into hot water.
Look also for an agreement that treats spammers harshly. This protects not only the company but other affiliates as well. The last thing you or any other reputable affiliate needs is to have your reputation and the reputation of the product/service you are promoting besmirched by these sorts of tactics.
=> High Commissions
Promoting someone else's affiliate program necessarily requires that you divert traffic away from your site and towards someone else's. Make sure you're properly compensated with a high commission structure. And be sure to set up your link so that when the visitor clicks on it, a new browser window is opened for the target site. This at least keeps your site in front of the visitor so they can go back to your site once they've finished at the site your link has taken them to.
=> Lifetime Commissions
Look for affiliate programs that will credit you with not only THIS sale but all other sales the customer may make in the future. Many programs are set up so that the customer is identified as "yours" so that when the customer returns to the target site in three months time, the sale is recorded as having been generated by you.
=> Residual Commissions
Include programs that offer residual commissions in your portfolio. Good examples are webhosting services, autoresponder services and the like where customers sign up for a continuous service that requires periodic, regular payments. You receive periodic, regular commissions as a result.
=> Tracking of Commissions
Look for programs that allow you real-time access to your stats so you can keep easy track of your commissions.
=> Reliability of Payment
When checking with affiliate references, find out what the business's record is on paying out commissions. If they're slow or there appears to be a pattern of problems, keep looking.
=> Frequency of Payment
Make a note of payment schedules too. Some programs pay weekly, some monthly, some quarterly. Some only pay once you accumulate commissions of a certain amount. None of these arrangements are necessarily good or bad in and of themselves. Just be sure you know what to expect.
=> Programs that Require Payment Up Front
Two words: MOVE ON!
=> Affiliate Support
Finally, take a look at what support the business offers its affiliates to make sales. Do they provide resources such as sample ads, banners, logos and the like? Do they provide useful advice about maximizing your sales? A good affiliate program provides affiliates with a LOT of support in these areas.
MAKING MONEY FROM AFFILIATE PROGRAMS
OK, now you know what to look for in an affiliate program. Here's how to maximize your sales of those products and services and, therefore, your commissions:
=> Get Your Own Website
No ifs, no buts. DON'T rely on the you-beaut self-replicated job the company provides all its affiliates. Link to that site from your main site.
=> Get Your Own Domain Name
This presents a much more professional image. Many people won't give the time of day to a business that thinks so little of its prospects that the owner won't shell out 70 bucks for a domain name. So mean business and look like it.
=> Get Traffic To Your Site (Duh!)
As a rough guide, you will need at least 500 targeted unique visitors a day to your site to make reasonable money from affiliate programs.
=> You Must Have A Site That Will Attract Repeat Visitors
If your website is nothing more than a splash page consisting of little else other than banners for umpteen different affiliate programs, forget it. Your site must be worthy of your visitor's time and interest before you can even begin to think about converting that visitor into a paying customer. So create a real site with real content that will keep them coming back for more.
=> Personal Testimonials
A personal testimonial will result in more sales than a mere link or advertisement. So take the time and trouble to write a personal endorsement of the product or service you are promoting. And, of course, it goes without saying that in order to write a personal endorsement, you must know that of which you speak. NEVER promote a program you haven't first purchased yourself. If you don't think enough of your program to invest in it, how do you expect to persuade others to?
=> Promote With Your Sig File
Include a link to your site in the signature of every email you send.
=> Promote In Your Own Ezine
Finally, if you're not already publishing your own ezine or newsletter to stay in touch with your site visitors, start. It's a great way to promote not only your site but also the affiliate programs you promote from your site.
MAKING SERIOUS MONEY FROM AFFILIATE PROGRAMS
The only way of making SERIOUS money from affiliate programs is by creating your own product or service and recruiting affiliates to sell for YOU.
The affiliate program phenomenon is one of the Internet's true success stories. It provides a toe-hold for the would-be internet entrepreneur to begin a real, live business of his or her very own. But the real beauty of affiliate programs lies not in what they can do for you, as an affiliate, but what they can do for you, as a recruiter of affiliates for your own program. By all means jump on the bandwagon and start promoting other people's products to get your start. But don't wait too long to start developing your own product line. There is a ready-made salesforce numbering in the millions ready and waiting to sell it for you.
About The Author
Elena Fawkner is editor of the award-winning A Home-Based Business Online ... practical home business ideas, resources and strategies for the work-from-home entrepreneur.
http://www.fawkner.com/subscribe.html
MORE AFFILIATE REVENUE RESOURCES updated Thu. February / 09 / 2012Disney's Earnings Beat; CEO Bob Iger Talks Piracy, Parks CNBC.com Increased guest spending and attendance at the parks, and higher advertising rates and affiliate revenue at the media networks drove the earnings upside. The revenue fell short of analyst expectations (Disney doesn't provide guidance) – at $10.779 ... |
 Globe and Mail | Disney derring-do New York Post “Affiliate revenue will kick up due to Comcast and other deals that will be negotiated,” Disney CEO Bob Iger said yesterday on a conference call with analysts to discuss first-quarter results. Iger noted the Mouse House doesn't yet have deals with ... The Walt Disney Company Reports First Quarter Earnings Disney Posts 7% Broadcast Revenue Drop Walt Disney's CEO Discusses Q1 2012 Results - Earnings Call Transcript |
 Telegraph.co.uk | News Corp. Earnings Jump in Second Quarter Broadcasting & Cable Affiliate revenue rose 9% at the domestic cable channels. Operating income for the television unit, which includes Fox Broadcasting, rose 25% to $189 million from $151 million. The company said the growth was the result of increased broadcast network ... News Corporation Reports Second Quarter Net Income of $1.06 Billion Headwinds Fail to Deter News Corp. |
 The Frisky | Pinterest Is Making Money In A Slightly Shady Way The Frisky It's also a boon for a company like Skimlinks, which takes 25% of all affiliate revenue. So what's the problem here? Well, Pinterest hasn't been disclosing to users when and how it is making money from their posts. If I pin a link to a cute pair of ... Skimlinks is the real story behind Pinterest's success |
AMD, Nike, Disney, Panera Bread Among Stocks Driving Big News Feb. 7th Wall St. Cheat Sheet The increase at ESPN was driven by higher affiliate revenue reflecting contractual rate increases and a reduction in revenue deferrals related to annual program commitments. During the quarter, ESPN deferred $190M of revenue compared to $266M in the ... |
Fox Studio, TV Divisions Boost News Corp. Q2 Profits Despite Hacking Investigation Reuters A little bit of everything contributed to the higher figures, from a nine percent growth in affiliate revenue to a six percent increase in advertising revenue. FX in particular continued to stand out as a top performer, while the NBA lockout both ... |
Fox on Top Multichannel News SNL Kagan calculates FNC's affiliate revenue at $985.3 million in 2012, based on 82 cents per sub each month. “The network is getting strong monthly subscriber fee increases, up from 58 cents in 2009,” according to Baine, who projects average license ... |
 Fortune | It's time for Disney to cut ABC loose Fortune Disney (DIS) blamed the poor showing at ABC on lower affiliate revenue following the end of Oprah Winfrey's popular talk show and a decrease in political ad spending, as it was not an election year. While both may explain a decrease in revenue, ... |
Cruise line, theme parks propel Disney profit Orlando Sentinel Operating income at Disney's media networks rose 12 percent for the quarter to $1.2 billion, as higher affiliate revenue at ESPN and the Disney Channel cable stations more than offset declines at broadcast station ABC. Operating income at Disney's ... |
Viacom's CEO Discusses Q1 2012 Results - Earnings Call Transcript Seeking Alpha We expect our affiliate revenue to grow on an annualized basis in the high-single to low-double digit for the foreseeable future. As we unlock value for our content across platform, we're unlocking growth potential across global markets as well, ... |
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