What prompted this post was a blog post on American Express Open Forum by Chris Brogan. Chris is one of my favorite bloggers and someone that I have always held in very high esteem. However, when I read his post it left me the impression that he made Affiliate Marketing seem like an easy way to make money. He throws out the estimated numbers in 2009 for affiliate marketing of 13 billion. Heck at 13 billion, anyone can get a piece of that pie or can they?
I left a short comment on the post that I would like to expand on. As a disclaimer, I would like to mention that I make money on affiliate sales and have set up a few clients with affiliate programs. There is also affiliate links sprinkled through my website so be careful.
That all important Affiliate Link, that code that you get that is embedded in your links, banners, skyscrapers and anything else that will accept a hyperlink. All you have to do is embed it and people will click on it and you make money or do you.
Most links will register a client’s computer by embedding a cookie on to their computer. So what happens when a client cleans his cookies? What happens if he sees and discovers the product and investigates just enough before he clicks through and then searches for the site? And the one that is just about always the case is if you’re in B2B sales, how often does the purchase occur on the computer that was registered. Do you think the purchasing agent ask the requester whose site they found the product on? Do you think the requester even mentions it?
However, when your prospect is registered, what happens next? First there is typically a minimum payout and a time limit on how long the cookies last. Did you know most cookies expire in less than 90 days? Did you know that there may be a minimum threshold before sales are paid out? The thinking behind that is that you will have the highest registration in the initial 90 days and the least conversion. Meaning the affiliate resource gets the e-mail address to forever market too for a very limited if any cost.
The 13 billion dollar mark has spawned a highly competitive market for handling the affiliate resources account. There are some great ones out there and I am only here to discuss one thing. What happens when your affiliate resource switches suppliers? That’s right, your cookies all disappear and you have to re-register all of your prospects again. It also means you have to change all your links that you have created to the new one.
Read the fine print well, if there is any. I have been told that half my affiliate sales were non-commissionable because the people that clicked through my site were commissioned and they could not pay out commission to both of us.
This is my favorite bug-a-boo. I drive people to a site, they register and I now have a good solid lead. My affiliate resource starts sending him his auto-responder to sell the product therefore doing all the work. Hmm, work = auto-responder? He may convert a few, maybe not, but then what happens is that a new wave of auto-responders start being sent; selling my affiliate resource’s, affiliates! That’s right, my resource tries to move him into one of his affiliates and guess what, you don’t get to participate in this sale. No way, no how!
So now let’s get to the real skivvy, RUN THE NUMBERS! Nobody is going to tell you this but think about how many impressions you have to make to get a click-thru. Than how many leads turn into sales and then your payout. The truth is seldom is it better than direct mail numbers of 1 to 3%. So picking 2%, (and that is very high on impressions to leads) if you have 10,000 impressions that is 200 leads and as a result 2 sales. If you make, $50 a sale that is $100 for your efforts. If you can accomplish, I would bet that you are doing better than 95% of the affiliates out there. So, look at two things: How much traffic does your website get or how big is your e-zine list? For the sake of explanation, let’s say my numbers above our correct. Are you willing to give up that number of leads to someone else for a $100.
Affiliate Marketing is not an easy way to make a living. You can participate in launches, book offerings and other affiliate efforts that could increase the odds of success and prove more successful. There are some great and I mean great partnership, coaching and program structures that could prove very lucrative for you. But if you are just looking for a cookie, in my opinion most would be better served in the hole they came from. What are your thoughts?