How Affiliate Marketing Works? If you are new to it. Advantages and Disadvantages.
“In a way, affiliate marketing can be compared to a commissioned salesperson except you don’t have to do any of the selling if you don’t want— the website you’re placing ads for can do all of the selling for you.”
Here’s An Example
Let’s say a company develop a training product for business owners who want to learn how to create their first website and start collecting leads. It’s priced at $500. They’re happy to pay it, because if they implement the strategies in this training product, they’ll be able to generate thousands of leads for their business which could be worth hundreds of thousands of dollars. $500 is a no-brainer.
I have a product and I have a website that
explains all the benefits of the product and how someone can buy it. But I have
no website visitors, I can’t make a single sale.
That’s where you come in: you become an
affiliate for my business by joining my affiliate program. Your role is simple:
bring potential customers to my website.
That’s it!
Once they are on my website, I can then sell him or her my course. If they buy it, I agree to split the $500 with you. After all, without you, I wouldn’t have made the sale in the first place.
Only seems fair, right?
Here is how it works!
You will be provided an Affiliate link with an Offer ID and Affiliate ID.
- “Company Tracker” indicates it is a tracking link for the Company
- “Offer ID” refers to the product
- “Affiliate ID” refers to you
Every time someone clicks that link, the click
is tracked as having come from your affiliate link through a combination of
cookies (little pieces of code), and the IP address and email address of the
person doing the clicking.
Don’t worry, you don’t need to know how it works, you just need to know that it’s very accurate and ensures that you get paid your commission on all people you refer to the website you’re promoting.
You can find thousands of affiliate products
and companies that you can represent by going through affiliate networks like:
- CJ Affiliate
- ShareASale
- Rakuten Affiliate Network
- Affiliate Window
- eBay Enterprise Affiliate
Network - ClickBank
- Amazon Associates
Advantages And Disadvantages Of Affiliate
Marketing
Advantages
- No product creation
- No payment processing
- No storage, shipping &
handling - Operate from anywhere
- No minimum monthly sales
- Scaled to any size you want
Disadvantages
- Low commissions (usually less than 40%)
- Lower priced items
- Rarely pay on back-end sales
Despite the advantages, traditional affiliate
marketing is flawed because of the low price point, low commissions and
restrictions on back-end sales which means you will have very low profits. With
such low profits you will have to constantly be looking for hundreds of new
buyers to make a decent income.
In short, it’s too much work for too little
money.
