Last Updated on September 23, 2021
Firstly, know that this article is not a comprehensive “welcome to affiliate marketing” guide. I will not spend much time going over the basics, but will spotlight the actual methods you need to make money – with a bit of pertinent background to help you understand the reasons behind these methods. You beginners will find this information invaluable and stimulating. You practiced marketers will find this information accurate and refreshing, while also discovering some astonishing new ideas to employ in your everyday endeavors. So, let’s continue.
Almost everyone that makes money on the internet (even the millionaires) do so through affiliate marketing. Affiliate marketing is a means of promoting web businesses in which an affiliate is rewarded for every visitor, subscriber, customer, and/or sale provided through his/her efforts. Compensation or commission may be made based on a certain value for each Impression (CPM), click (Pay-per- click), registrant or new customer (Pay-per-lead) or (Cost-per-Acquisition / CPA), sale (usually a percentage, Pay per sale or revenue share), or any combination of them.
In very short English; there are literally hundreds of thousands of affiliate programs on the web featuring tens of millions of products ranging from magazine subscriptions to life insurance and every conceivable thing in between. An affiliate is essentially a salesperson whose job is to send people to a merchant’s website. When a predetermined “action” or sale is made, the affiliate is paid a commission. It’s the same as being a salesperson in retail, only online. I will teach you more about the actual application of affiliate marketing later in this chapter.
Another important attribute of an affiliate program is its’ compensation model. This may have an impact on which advertisers you decide to join and how you go about promoting them. It will surely have an impact on how much money you will make. Here is a breakdown of the various compensation models that affiliate advertisers utilize.
Pay-per-impression (PPI) / Cost-per-thousand (CPM)
Cost-per-mil (mil/mille/M = Latin/Roman numeral for thousand) impressions. Publisher gets from Advertiser $x.xx amount of money for every 1000 impressions (page views/displays) of the ad. The Ad can be text , rich media, but in most cases, the ad is a banner running across the top, or down the side of a website.
Pay-per-click (PPC) / Cost-per-click (CPC)
Cost-per-click. Advertiser pays publisher $X.XX amount of money, every time a visitor (potential prospect) clicks on the advertiser’s ad; it is irrelevant (for the compensation) how often an Ad is displayed. Commission is only due when the Ad is clicked. The PPC model is used by Google AdWords, Miva and other providers. These are the ads that you see running along-side search results and many web-pages out there.
Pay-per-lead (PPL) / Cost-per-action/acquisition (CPA) / Cost-per-lead CPL)
Cost-per-action (CPA). Cost-per-Lead (CPL). Advertiser pays publisher $X.XX in commission for every visitor that was referred by the publisher to the advertiser (web site) and performs a desired action, such as filling out a form, creating an account or signing up for a newsletter. This compensation model is very popular with online services from internet service providers, cell phone providers, banks (loans, mortgages, credit cards) and subscription services.
Pay-per-sale (PPS) / Cost-per-sale (CPS)
Cost-per-sale (CPS). Advertiser pays the publisher a percentage (%) of the order amount (sale) that was created by a customer who was referred by the publisher. This model is by far the most common compensation model used by online retailers that have an affiliate program. This form of compensation is also referred to as Revenue sharing.
Pay-per-call (no abbreviation exists yet)
This is a new compensation model. No official abbreviation exists yet. Advertiser pays publisher a $X.XX commission for phone calls received from potential prospects as response to a specific publishers’ ad. Recently developed call-tracking technology allows to create a bridge between online and offline advertising. Pay-per-call advertising is still new and in its infancy.
Choosing a Model:
As you can see, there are advantages and disadvantages to the various compensation models. This can (and should) be decisive in your selection of which affiliate program to join, but depends largely on what you are promoting and how you decide to go about promoting it. For example, the paid surveys program Survey Adventure, pays out an extremely high $4.50 per double opt-in lead (CPA). The action; signing up with the company is free, so obviously, the program converts very well, but you must provide many leads in order to make a substantial amount of money. The real money is in pay per sale programs (PPS). If you have a good product and a sound marketing plan, the money will come.
Affiliate Marketing & You
There are many other aspects, facts, advice and information that I could share with you on the subject of affiliate marketing, but we don’t want to get too far into it. So I will briefly cover a couple of subjects quickly that apply to what I feel you will actually need to know and what you will be employing in your money-making endeavors.
The rise of blogging, interactive online communities, article directories, simple web sites and other new technologies and are forming the new Web 2.0. These new technologies have impacted the affiliate marketing world in a very big way. Creating a presence online used to take months as well as a number of trained professionals. Nowadays, it is quite possible for newcomers to (by themselves) “set up shop” literally overnight and with very little experience. Also, this new media allows merchants to get closer to their affiliates and improved communication between each other. What this means to you, is that you can be on your way to becoming a super affiliate master as soon as you finish this guide!
Trademark Bidding / SEO
Affiliates were among the earliest to adopt Pay-per-click advertising when the first PPC search engines. In 2000 Google launched their PPC service AdWords which is responsible for the wide spread use and acceptance of PPC as an advertising channel. Since then, a large number of advertisers have adjusted their affiliate program terms to prohibit their affiliates from bidding on those types of keywords. Though we will not go into PPC Marketing, you must understand that some trademarks, such as the term “eBay” are heavily restricted because of this.
One area that has not been hit by new restrictions is SEO or “Search Engine Optimization”. Later, I will be teaching you how to create profiles that will trick Google and other search engines into indexing them as relevant websites and list them in top search results. Sign up for AdWords and Miva. I will show how to use these later in the guide.
Why Affiliate Marketing
Affiliate Marketing is driven by entrepreneurs who are working at the forefront of internet marketing. Affiliates are the first to take advantage of new emerging trends and technologies where established advertisers do not dare to be active. Affiliates take risks and “trial and error” is probably the best way to describe how affiliate marketers are operating. This is also one of the reasons why most affiliates fail and give up before they “make it” and become “super affiliates” who generate $10,000 and more in commission (not sales) per month.
You will not earn the right to call yourself an affiliate marketer overnight. You will have to work (relatively) hard and innovatively to make the kind of money that you want, but know that if you do, the rewards are very large and there for your taking. Never give up!
Very few publishers handle their affiliate programs in house. Most affiliate programs are set up and managed by large affiliate networks. Most of my affiliate programs are set up and maintained by the affiliate network ClickBank, which is the largest affiliate network on the web. Some networks do not have qualification criteria, but most do.
The majority of this online guide will focus on marketing strategies for ClickBank affiliates, but here is a short list of the top affiliate networks that all of the professionals belong to and you should apply to.
The “Big 4” Affiliate Networks
ClickBank connects over a hundred thousand affiliates with thousands of information product vendors offering a huge array of downloadable products, mainly eBooks. Because it is cheap and easy for merchants to join, the quality of the products provided can vary. ClickBank is also a great place to search for unexploited niches.
Commission Junction (or “CJ”) is another very popular affiliate network. CJ brings together affiliates and product vendors, but also offers physical products for its affiliates to promote. CJ has many large brand names on its site, and is very well established. It is free to sign up, but most vendors are selective of who represents them.
LinkShare features more than 600 merchants. You’ll find mostly big name and well established companies, such as Wal-Mart, Foot Locker, and Apple iTunes. Merchants are selective in representation!
Performics is a highly professional site with very well known brands. Performics’ clients include: Orchard Bank, Office Max, Activa Sports, Barnes&Noble, Fossil, and more than 200 other big name, big business advertisers. Performics is owned by DoubleClick. Armatures need not apply, but may try.
Getting Paid By The Networks
Most affiliate networks require that you reach a “payment threshold” before they will release your first payment. While the amount usually varies from network to network, exactly how they pay you is pretty much your choice. Your three choices that you have are Check via mail, Direct Deposit and PayPal. I do not like to wait for checks so I set most of my accounts to direct deposit on payday. You may set your affiliate accounts to deposit your earnings directly to the card. This saves you the week of delivery time on the checks and the two week waits for the out of state checks to clear.
PayPal is also a great option, but not all affiliate networks offer payment via PayPal. It works exactly like direct deposit. Just check your account on payday to find the money there. You may also set up a merchant (business) account like I did so that you can get a PayPal Debit card. Again, it works just like a bank. Oddly enough, when I applied for my card the interest that I was (and still do to this day) earning on my money was higher than any bank I have ever heard of. Almost up there with CDs, but that’s another story.
I like to set up my finances this way so that I always have affiliate earnings separate from the other earnings that I associate with my normal bank accounts. Also, when Uncle Sam asks me about my income at the end of the year, I don’t have to worry about gathering paystubs or the like. I can just print out my account history for two accounts. Really, how you get paid is up to you, but as far as I know, fast and free is always better.
ClickBank & CJ
ClickBank connects over a hundred thousand affiliates with thousands of information product vendors offering a huge array of downloadable products, mainly informational eBooks. Because it is cheap and easy for merchants to join, the quality of the products provided can vary. ClickBank is also a great place to search for unexploited niches.
If you are wondering what an “information product” is, you have one in your hands (or at your fingertips) right now. Information products include e-books, video tutorials, audio teleconferences, software, etc. – fundamentally anything that comes in a digital form.
To keep it simple; the first thing that you will do is sign up with ClickBank, get a free affiliate account and look for products you want to promote. Whenever you get a sale, your account is credited with your affiliate commission and checks are mailed out every two weeks (once you break the small minimum sale threshold).
The reason that ClickBank is so popular is the large commissions. Since ClickBank specializes in information products, the product vendor’s costs are minuscule and large commissions are passed on to affiliates – often as much as 50-75%. In most cases, it is far easier to make a lot of money online earning 50% of a sale than 5% of one (which is what you will get with many products on other networks such as Commission Junction and LinkShare). For these reasons, the majority of this guide will be focused on strategies for ClickBank affiliates.
One section of ClickBank that you will be visiting frequently during your time as a marketer is the ClickBank Marketplace. The ClickBank marketplace lists the products that are currently being sold by publishers. Once you have found a product that you would like to promote, you simply enter your ClickBank name to receive your hop-link. This will track your sales.
When looking for a product to promote, you are going to base your decision on results of your target market criteria. You may for example, click on “money and employment” and search for “Make Money Online”, in which you will find too many results to count, but of course you can narrow that down to your target market by being more specific. Search for something like “Affiliate Marketing Beginners”. Once you have a list of potential products you will be searching for products by the following important factors:
$/Sale: The amount of money (minus refunds) that network affiliates have earned per sale in the past.
%/Sale: The percentage of profit that is paid to affiliates per sale. Most product vendors at ClickBank pay 25% to 50%. Most vendors looking to sell a lot of their products pay 75%, regardless of quality or other factors.
% Referred: The percentage of product sales that were generated by affiliates rather than the vendors own promotions.
Gravity: Gravity in short represents the popularity of a product – (the amount of affiliate sales have been made recently). Just because a product may be more popular than the other does not necessarily mean that the product is making more money for its affiliates.
The products are arranged by their popularity. You may review the above factors as well, so you can click on the product title to have a look at the “pitch page”. You may find something you like and decide to promote it as an affiliate.
What To Sell
There are a many “gurus” out there that will all tell you how to promote the most popular products on ClickBank, but the truth is that not too many of them have anything great to share. They will tell you about AdWords, article writing and scamming people into buying the highest priced products you can find, all of which will cost you quite a bit of money to get started. AdWords alone these days costs a fortune to “play” in.
Here is what I say you need to do. Don’t try to go onto ClickBank and find the highest selling products to promote. Find something that appeal to your target market. Believe me when I tell you, that you can find products on ClickBank related to anything and everything, all offering affiliates great commissions.
A great example would be the World of Warcraft player’s niche. This game has got to be the most massively multiplayer game in the world and one of the most popular. Personally; I think that it is for geeks, but many of my college friends enjoy playing it, ahem, “living it”.
When you search ClickBank for “Warcraft”, you will find quite a few good products and about four that I would consider “great”. (Update: What was a “few” products are now a few pages of them. These things must be selling.) When you search Google for “Warcraft”, you get 10,610,000 results. On the popular social network Myspace, there are more than 3124 Warcraft groups, with the top group featuring 40,000 members.
This goes to show that with a minimal amount of research into a niche with ClickBank, you cannot go wrong. I was quite literally going to save this niche for myself and use a different example for this, but then I started to feel greedy and I want this method of marketing to work for you. So, if you are the first one reading this guide, you already have a head start, but don’t be surprised to find this niche swamped soon after.
Commission Junction (or “CJ”) is another very popular affiliate network. CJ brings together affiliates and product vendors, but also offers services and physical products for its affiliates to promote. CJ has many large brand names on its site, and is extremely well established. It is free to sign up with the network, but most vendors are selective of who represents them. Most often, a website with substantial targeted traffic is a requirement of vendors.
Instead of a “marketplace”, Commission Junction arranges its advertisers in its “Advertiser List” and you may only promote advertisers once you have been approved to be one of their “publishers” which is what CJ calls its affiliates. Below is a list of the paid survey advertisers that I work with. Notice how there is a “date accepted” column? This goes to show that I grew my business relationships over time.
Network Earnings: which is like ClickBank’s $/sale feature and represents the amount of money (minus refunds) that network affiliates have earned per sale in the past.
$/Action: Like ClickBank, many products on CJ offer a percentage or dollar amount that you earn per sale of a product, but with CJ you may also sort by the amount earned per lead and click (CPC and CPA).
EPC: Commission Junction also has a few different ways of representing the popularity of an advertiser. The most important of these is done by showing the “EPC” or “earnings per click” ratio which is represented by how much money is earned on average per 100 clicks. So a 7 day EPC of 24.69 which is the case of Greenfield Online means that in the last 7 days of 8.9 of the last 100 visitors to the site, have signed up with Greenfield and the referring affiliates have made money. That may not sound “great”, but in the world of affiliate marketing, it’s ok.
What To Sell
Just about all of the advertisers that I work with via Commission Junction employ the CPA compensation model. One of the most popular markets both on Commission Junction and among web-surfers right now is paid surveys. Because CJ offers the option of CPA, a great number of survey companies have signed up with them.
Commission Junction has some of the best converting free to join CPA programs on the net such as the paid surveys program Survey Adventure. It pays out an extremely high $4.50 per lead (CPA). Once again, this is a high converting program because sign up with the company is free. It may seem that $4.50 is not a very high payout. That’s true to an extent. You may have to send a good amount of traffic to this company to see great results. With CPA the desired action that you want your visitors to complete is free for them, so the profits should come quickly.
But Remember Your Target Market
At first glance, it may look like the Network Earnings should be the deciding factor in what you will promote, but I assure you, it is not. Your target market should always be the deciding factor in what you decide to promote. Because paid surveys are so popular among college students, such programs convert very well.
Once again, you really need to do just a bit of research to find out what will appeal most to your target market.
For Newbies: The Easy Way To Get Into Affiliate Marketing
I am not going to get into this on an in-depth level. I am just going to say it; and you had better remember it. The best way to make money selling ANY product or service of someone else’s is to pre-sell it and the best way to do this on the web is by creating a simple website that may consist of no more than a presales page. It is probably the simplest and most effective one webpage in any webmasters arsenal. Often in a “product review” format which has become wildly popular ever since the release of a number of short and sweet eBooks. The presales page can often take on many other formats such as customer testimonial, anti-scam and programs database page just to name a few. In the end, all of these are simply teasers of a product or products that are so effective, a visitor cannot wait to purchase the product(s) that you are promoting. I am not claiming this to be the only method of selling, just the most effective for you.
Now a great many “gurus” would like to take credit for the key components of an effective sales-page, but the methods and theories of pre-selling have been around longer than computers. It’s just a matter of bringing them to the attention of potential webmasters while teaching how to easily implement them, so, here they are, the key components of an effective website:
The Attributes of A Successful Website
Give Visitors Hope: Every single day, people buy things. If what they buy is not meant to simply keep them alive, such as food, the product that they buy is meant to improve their life in some way. They hope that buying “the next best thing” will lead them to “the next best stage” in their lives. Take you for example. You are reading this in the hopes that you may apply the methods I am showing you to make money on the internet; and this money would undoubtedly improve your life. Here’s a shocker: Why do you think I wrote it? Because I want to make money and build a name for myself by helping others make money online, thus, improving my life.
I have found “how to make money” informational products to be the best selling on the web, but there are many products that this can apply to. Even in a not so life altering sense. I recently saw a offer where users can “download a vast array of media and games ready to be played on the iPhone” and it was selling like crazy. I don’t care for the “locked” iPhone or Apple for that matter, but the thing insanely popular among the techies and status seekers. Anyway, these people are hoping that this product will give them an entertainment on the go, thus improving their commutes or whatever, and in some small way, their lives. When you create your presales page you will feed on this need for hope. If you decide to take the product review approach, tell visitors how “your” product is so much better than the others. If you go with the customer testimonial format; (which I suggest if you decide to market ProfilesToProfits), tell them how this product has changed your life and how it will do the very same for them.
Create Urgency: In my experience, both personal and professional, the average web browser has the attention span of a goldfish. To combat this problem, a great presales page must create a sense of urgency in the visitor. Let it be known that for whatever reason, the visitor must continue to stay on your page, read the entire thing and when they finish, they must buy your product because if they don’t than they are missing out on the one thing that could have changed their life forever. Did you see that? I just tied in this urgency with the first component of a successful presales page and in doing so; I have both created more hope and a more effective sense of urgency.
Many people try to do this by putting discount deadlines on their products. “Buy in the next ten minutes and blah blah….” this coming from the supposed “pros” and “gurus”. Click the back button, and then the forward button to see the same deadline. People see right through this these days. It is content that creates urgency. It is the manner in which you present your product and how you play on the many factors of an effective presales page. Once again, you must create the impression that they must buy your product because if they don’t than they are missing out on the one thing that could have changed their life forever.
Be an Authority: Appearance is everything. Whether you know anything about your product or not, you must appear to the visitor as the most informed, educated and trustworthy person regarding this product on the face of the earth. You will NEVER sell a product using the presales page format if the user feels that you do not know what you are talking about. Study up on your product, use this product yourself. Turn yourself into the one person to talk to regarding this product. If that is too much work, find somebody who knows what you ought to and pay them to help you appear as an expert. I cannot stress this enough. This may be the most important piece of the presales page puzzle. If the visitor thinks that you are and idiot or that you don’t know what you are talking about, they will not buy from you, unless of course, they are an idiot!
The first three components of an effective sales page/website are not optional. If you decide to build a website and you do not factor these components in, you will not make it online. You will fail. Below are a few optional components that you can add to your website. Sometimes these components will work for you, other times they will not, so think hard on whether or not implementing them will ultimately benefit your cause, or hurt it.
Appear Unbiased: This is the most effective way of gaining a visitor’s trust second only to your being an authority on the given topic. Most of the time, appearing unbiased is a tactic used by database sites. I recall a site that I went to when I first became interested in affiliate marketing (I was 16). It was a database of products to sell online. At the time, it just looked like a database. I later found that just about all of the programs listed were multi-level-marketing schemes, which means that if I signed up with one of the programs that was on this site and made a sale, the owner of the site would make money as well. No, there is nothing wrong with this. MLM is far from a scam as many like to slander. The ones who give it a bad name just suck at it.
Back to the point; If a visitor comes to your site and becomes under the impression that you “just want to help”, they are far more likely to buy from you than if have a sales pitch at every turn. Review a product or products. Set up a product database. Help people avoid internet scams (you will read more on that next). Do whatever you must to make it look like you are their helpful friend. They don’t have to know that you will be making a commission from a purchase that they make.
Strike Fear: This is another tactic that has gone mainstream since the release of “The Rich Jerk” and works best when used to promote products that belong to a saturated market, such as the “how to make money in real estate” eBook market and I have found it to be terribly overdone lately, especially by users of Google AdWords and other pay-per-click methods of promotion.
The idea here is that you are out to convince people that there will be tribulation down the road for them if they decide to go with any product besides yours. Most people who endeavor this plan have simple anti-scam websites that consist of no more than a page or two describing the horrors of a particular market. They tell visitors that there are so many scams out there that they should not sign up for any program, unless of course, the visitor signs up for the one(s) that they are promoting (which pay the largest commissions).