How to Get Started in Affiliate Marketing
| Category: Affiliate Marketing - Basics | Date: 2003-04-28 |
1. Introduction
Affiliate marketing occurs where advertising is placed on a website, and the website owner is rewarded for the performance, rather than exposure, of that advertising. In other words, an advertiser will pay the website owner a commission or fee if people visit that website, click on the advertisers banner, and/or do something of value on the advertisers website, such as make a purchase. The website that carries the advertising is known as the affiliate, and the advertiser is known as the merchant.
All advertising banners are encoded with an ID number for each affiliate. When a visitor to an affiliates website clicks on a banner, that ID number follows the visitors activity on the merchants site. This ensures that the affiliate is credited with any commissions earned if the visitor buys something from the merchant.
There are few requirements to get started as an affiliate,however you will need to make some important decisions to ensure you get off to a good start.
2. Website
The essential requirement is a website. There are a number of tasks you will have to perform in order to have a functioning website.
a. Domain Name
Ideally, you should also have your own domain name, e.g. www.usedcars.com. This gives you greater credibility and recognition than using a URL (web address) which is an extension of someone elses domain name (such as your web hosts), but you will have to pay to use your own domain name.
Dot com (.com) domain names have the greatest universal credibility . However, the problem with "dot com" names is that most generic type names have been taken, so that you may have to choose a phrase name, e.g. www.bestusedcars.com or a more individual name, e.g. www.harrysusedcars.com. You may even decide to use a domain name with your own countrys extension, such as ".com.au" for Australia.
b. Build a Website
This is perhaps the most difficult task in internet marketing.If you want to be very successful at affiliate marketing, the only way to avoid learning web design is to have your site developed by a professional designer. However, this will probably be very expensive.
There are web design software packages available at a reasonable price, such as Microsoft Frontpage, which provide templates that you can easily adapt to your purposes. You may even choose to use one of the free website services, such as Homestead, Geocities, Tripod, Xoom or Angelfire. This will at least it will give you a start and help you get your own website.
c. Website Theme
There are no real restrictions on the subject matter of your website. You need to bear in mind, though, that one of the keys to affiliate marketing is traffic. This means that the more people who visit your site, the more promotional opportunities you will have. Therefore, your site should be about something that you think other people will be interested in. It could be about yourself, or your favorite sport, hobby, or band. If you have a special knowledge or skill, then try to build your webpage around that, because that will make it is easier to
promote your webpage.
3. Find a Webhost
Once you have designed your website, you need to find someone to host it for you, unless you use one of the free services mentioned above. Most I.S.P.s provide webhosting services. If you are just starting off, it is best to go with the cheapest plan available from a reliable webhost. If you want your own domain name, your webhost may require you to accept a higher plan. In the early stages at least, you wont need any more than 2MB of server space. If your webpages are an average of
50KB in size, you can have up to 40 pages on your site. Download limits should not be a problem either.
Your webhost should also provide good statistics about your sites traffic. The most important information you need is where your visitors are coming from to get to your site, and especially the keywords they have used to find your site in the search engines.
4. Choosing Merchants
Your choice of merchants can be a very difficult decision. Most
affiliates (website owners) simply use trial and error to determine the most suitable merchants. However, there are some important principles to which you should adhere.
a. Consistency with your website
The merchants that you choose should sell products or services that are consistent with the theme of your website. This is because those products and services should appeal to the people who visit your site.
Some affiliates take a reverse approach. They try to identify one or two good merchants, then develop a website which has the primary function of promoting those merchants. This doesnt mean that they fill the website with those merchants links and banners. Rather, the website will "set up" those people who visit the site to be more inclined to buy from those merchants. For example, if you feel that Amazon.com and Barnes and Noble are good merchants, you might develop a site which provides book reviews, and which is linked to these merchants to enable the visitor to buy those books easily.
b. Reward System
The next point to consider is the reward system you want to use. The most common are:
i. Commission on Sales
Most merchants will pay you a percentage of the sales made by visitors referred from your website. The problem with this method is that you are relying on the ability of your affiliate to close a sale with the visitor. Therefore, you should try to actively promote the merchant and/or its products on your site, so that the visitor is already thinking about making purchase as he/she clicks on the merchants banner.
ii. Pay Per click
Some affiliate programs will pay you a small amount (normally less than US$0.05) whenever someone clicks on one of their banners or links on your site. This is the surest way to at least make some money, but you need a lot of traffic if you are going to rely on pay per clicks.
iii. Pay Per Lead
This method involves the affiliate paying the referrer if he/she sends someone to the affiliates site and that person does something like sign up for the affiliates newsletter, register as a member, or complete a survey. The normal lead payment is US$0.50 to $1.00. This is perhaps the best type of program, provided the requirements for being paid are not too difficult.
For non-U.S. website owners, pay per click and pay per lead programs are the best, since many commission-based programs rely on selling goods or services that your customers may be reluctant to buy. However, if you are going to rely on pay-per-click or pay-per-lead programs you will need a lot of traffic,or a high conversion rate, to generate much revenue.
iv. Focus
Many affiliates make the mistake of filling their sites with banners from a dozen or more merchants. A better approach is to focus on one or two programs, since this indicates that you have personally chosen those merchants as the best for your visitors. It also ensures that your site is not cluttered with advertising, and forces you to provide valuable content.
c. Best Rewards
The next selection criteria is the amount of the reward that you will or may earn from sending a visitor from your site to an merchant. Remember that once a visitor has left your site, he/she is unlikely to return straight away. This means that is in your interest to obtain the maximum possible return for driving someone from your site.
d. Reliability
The affiliate program industry has a reputation for late or non-payment of commissions to website owners, so you need to be careful to stick to reliable affiliates and programs. This is where Commission Junction is very good, since it is extremely reliable in its payments.
The other advantage of Commission Junction is that you receive one payment each month which covers all the money owed to you by their merchants. LinkShare has acquired a poor reputation,mainly because the payments come from the merchants themselves, and many do not have reliable payment systems.
Commission Junction also allows you to determine the minimum value of your payment cheques. This is a real bonus for international ffiliates, since low value cheques often get eaten up by bank fees when converting them to your local currency. You can select a minimum cheque value up to US$250.
5. Conclusion
Affiliate marketing is not simply a matter of creating a website, putting up a lot of advertising banners, and just waiting for your commission cheques to arrive. You will have to work hard to develop your site, select the right merchants, promote your site, and convince your visitors to visit your merchants. But at least now you understand the basics of affiliate marketing, and are on the right track to success.
About the author
Article by Alex Fox, of Alex Fox Consulting Services Alex is also publisher
of "Internet Success" - to subscribe, go to
http://alexfox1.listbot.com/
:To contact see details below.
This article provided by the InfoZone Archives at: http://www.MakingProfit.com
enquiries@alexfox.com.au
http://www.alexfox.com.au
Affiliate marketing occurs where advertising is placed on a website, and the website owner is rewarded for the performance, rather than exposure, of that advertising. In other words, an advertiser will pay the website owner a commission or fee if people visit that website, click on the advertisers banner, and/or do something of value on the advertisers website, such as make a purchase. The website that carries the advertising is known as the affiliate, and the advertiser is known as the merchant.
All advertising banners are encoded with an ID number for each affiliate. When a visitor to an affiliates website clicks on a banner, that ID number follows the visitors activity on the merchants site. This ensures that the affiliate is credited with any commissions earned if the visitor buys something from the merchant.
There are few requirements to get started as an affiliate,however you will need to make some important decisions to ensure you get off to a good start.
2. Website
The essential requirement is a website. There are a number of tasks you will have to perform in order to have a functioning website.
a. Domain Name
Ideally, you should also have your own domain name, e.g. www.usedcars.com. This gives you greater credibility and recognition than using a URL (web address) which is an extension of someone elses domain name (such as your web hosts), but you will have to pay to use your own domain name.
Dot com (.com) domain names have the greatest universal credibility . However, the problem with "dot com" names is that most generic type names have been taken, so that you may have to choose a phrase name, e.g. www.bestusedcars.com or a more individual name, e.g. www.harrysusedcars.com. You may even decide to use a domain name with your own countrys extension, such as ".com.au" for Australia.
b. Build a Website
This is perhaps the most difficult task in internet marketing.If you want to be very successful at affiliate marketing, the only way to avoid learning web design is to have your site developed by a professional designer. However, this will probably be very expensive.
There are web design software packages available at a reasonable price, such as Microsoft Frontpage, which provide templates that you can easily adapt to your purposes. You may even choose to use one of the free website services, such as Homestead, Geocities, Tripod, Xoom or Angelfire. This will at least it will give you a start and help you get your own website.
c. Website Theme
There are no real restrictions on the subject matter of your website. You need to bear in mind, though, that one of the keys to affiliate marketing is traffic. This means that the more people who visit your site, the more promotional opportunities you will have. Therefore, your site should be about something that you think other people will be interested in. It could be about yourself, or your favorite sport, hobby, or band. If you have a special knowledge or skill, then try to build your webpage around that, because that will make it is easier to
promote your webpage.
3. Find a Webhost
Once you have designed your website, you need to find someone to host it for you, unless you use one of the free services mentioned above. Most I.S.P.s provide webhosting services. If you are just starting off, it is best to go with the cheapest plan available from a reliable webhost. If you want your own domain name, your webhost may require you to accept a higher plan. In the early stages at least, you wont need any more than 2MB of server space. If your webpages are an average of
50KB in size, you can have up to 40 pages on your site. Download limits should not be a problem either.
Your webhost should also provide good statistics about your sites traffic. The most important information you need is where your visitors are coming from to get to your site, and especially the keywords they have used to find your site in the search engines.
4. Choosing Merchants
Your choice of merchants can be a very difficult decision. Most
affiliates (website owners) simply use trial and error to determine the most suitable merchants. However, there are some important principles to which you should adhere.
a. Consistency with your website
The merchants that you choose should sell products or services that are consistent with the theme of your website. This is because those products and services should appeal to the people who visit your site.
Some affiliates take a reverse approach. They try to identify one or two good merchants, then develop a website which has the primary function of promoting those merchants. This doesnt mean that they fill the website with those merchants links and banners. Rather, the website will "set up" those people who visit the site to be more inclined to buy from those merchants. For example, if you feel that Amazon.com and Barnes and Noble are good merchants, you might develop a site which provides book reviews, and which is linked to these merchants to enable the visitor to buy those books easily.
b. Reward System
The next point to consider is the reward system you want to use. The most common are:
i. Commission on Sales
Most merchants will pay you a percentage of the sales made by visitors referred from your website. The problem with this method is that you are relying on the ability of your affiliate to close a sale with the visitor. Therefore, you should try to actively promote the merchant and/or its products on your site, so that the visitor is already thinking about making purchase as he/she clicks on the merchants banner.
ii. Pay Per click
Some affiliate programs will pay you a small amount (normally less than US$0.05) whenever someone clicks on one of their banners or links on your site. This is the surest way to at least make some money, but you need a lot of traffic if you are going to rely on pay per clicks.
iii. Pay Per Lead
This method involves the affiliate paying the referrer if he/she sends someone to the affiliates site and that person does something like sign up for the affiliates newsletter, register as a member, or complete a survey. The normal lead payment is US$0.50 to $1.00. This is perhaps the best type of program, provided the requirements for being paid are not too difficult.
For non-U.S. website owners, pay per click and pay per lead programs are the best, since many commission-based programs rely on selling goods or services that your customers may be reluctant to buy. However, if you are going to rely on pay-per-click or pay-per-lead programs you will need a lot of traffic,or a high conversion rate, to generate much revenue.
iv. Focus
Many affiliates make the mistake of filling their sites with banners from a dozen or more merchants. A better approach is to focus on one or two programs, since this indicates that you have personally chosen those merchants as the best for your visitors. It also ensures that your site is not cluttered with advertising, and forces you to provide valuable content.
c. Best Rewards
The next selection criteria is the amount of the reward that you will or may earn from sending a visitor from your site to an merchant. Remember that once a visitor has left your site, he/she is unlikely to return straight away. This means that is in your interest to obtain the maximum possible return for driving someone from your site.
d. Reliability
The affiliate program industry has a reputation for late or non-payment of commissions to website owners, so you need to be careful to stick to reliable affiliates and programs. This is where Commission Junction is very good, since it is extremely reliable in its payments.
The other advantage of Commission Junction is that you receive one payment each month which covers all the money owed to you by their merchants. LinkShare has acquired a poor reputation,mainly because the payments come from the merchants themselves, and many do not have reliable payment systems.
Commission Junction also allows you to determine the minimum value of your payment cheques. This is a real bonus for international ffiliates, since low value cheques often get eaten up by bank fees when converting them to your local currency. You can select a minimum cheque value up to US$250.
5. Conclusion
Affiliate marketing is not simply a matter of creating a website, putting up a lot of advertising banners, and just waiting for your commission cheques to arrive. You will have to work hard to develop your site, select the right merchants, promote your site, and convince your visitors to visit your merchants. But at least now you understand the basics of affiliate marketing, and are on the right track to success.
About the author
Article by Alex Fox, of Alex Fox Consulting Services Alex is also publisher
of "Internet Success" - to subscribe, go to
http://alexfox1.listbot.com/
:To contact see details below.
This article provided by the InfoZone Archives at: http://www.MakingProfit.com
enquiries@alexfox.com.au
http://www.alexfox.com.au
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