The Case for the Complete Affiliate Marketing Business

  • May 5, 2010 by Corbett Barr
  • 28 Comments

I mentioned a while ago that I’m working on a bigger project all about affiliate marketing. I’ll share more details about that project shortly (and at the end of this post), but I wanted to talk today about affiliate marketing as a complete business.

If you’re completely new to affiliate marketing, the concept is simple. Lots of businesses and people online are willing to reward you for referring new customers or visitors. All you have to do is sign up for an affiliate marketing program and direct people to the program owner’s site. If those people purchase something, you earn a commission.

What I love about affiliate marketing as a business is that it doesn’t require you to create any products, write any software, hire any employees or meet with anyone in-person or online. You just find people who might be interested in purchasing a product and show them where they can purchase it. It’s probably the easiest way to get started making money online.

Rinse and repeat and you can earn a full-time living solely through affiliate marketing. In fact, affiliate marketing is already a $13 billion industry and growing. The popular affiliate network ClickBank has paid out over $1.5 billion in commissions to affiliate marketers alone. That’s just one network.

Affiliate marketing can be a highly scalable business model too.

Anything from a 1-page website / $100 per month business to a huge site earning millions of revenue per year can be based on affiliate marketing.

Chances are, you’ve visited some big affiliate marketing sites before, but weren’t aware of it. Here are a few you might have heard of (thanks to Rae Hoffman for the examples):

All three of those huge sites are essentially affiliate marketing sites. That’s how they each make money. They provide content or services based around a particular topic (consumer credit or product reviews in this case) and refer customers to other websites as an affiliate so they can collect commissions.

Those sites are each at least a decade old, they are run by companies with hundreds or thousands of employees and they generate millions of dollars in revenue each year. How’s that for scalable?

But you don’t want giant, right? You want a lifestyle business.

You’re not here for advice about building giant employee-heavy companies in the traditional way. At least I hope you’re not. You’re here because you want freedom. You want to do be able to do what you love. You want to be able to live and work anywhere and decide how you spend your time.

Good news, affiliate marketing could be the foundation of the lifestyle business you’re looking for. Take Karol Gajda of Ridiculously Extraordinary for example. He has earned the majority of his income over the past 10 years from affiliate marketing (up to $2,000 per day I hear). I’ve been earning the majority of my income for the past six months from affiliate marketing too, although not on the same scale as Karol.

We’re not just talking supplemental income. Real, earn-the-freedom-to-live-how-you-want-to income is possible.

Both Karol and I have spent considerable time outside of the country over the past year. Affiliate marketing doesn’t care where you are or when you work. Even better, it allows you to earn money when you’re not working.

OK, that’s all good, but will I feel good about working in affiliate marketing? Is it something you can be passionate about?

Hmm, good question. That really depends on who you are. Affiliate marketing isn’t the kind of business where you necessarily get to interact with a lot of other humans. You could build a site that’s more interactive, but it’s not typical.

By feeling good about it, you could also be thinking it might be a little sleazy. You know, like internet marketing. There is a ton of crappy information out there about affiliate marketing put out by the same hucksters who try to sell you guides about “Twitter cash machines” or “membership site millionaires.” I feel sorry for beginners who have to wade through all of that garbage to figure out what affiliate marketing is all about.

It really comes down to what you want to make of it. Those sites I referenced earlier (Bankrate, etc.) are certainly useful, well-intentioned sites.

Assuming you’re looking to contribute something worthwhile to the world, there is no reason you can’t be proud of what you create around affiliate marketing. Here’s a great example of an affiliate marketing site with valuable information that’s run by a small team (and happened to do over $100k in revenue last year).

I would suggest to anyone looking to get into affiliate marketing that you focus on building sites on topics you care about (not just ones that seem to have opportunities). It makes a big difference in the long run if you like the products and topics you’re selling on.

Get-rich-quickers need not apply.

I said earlier that affiliate marketing is one of the easiest ways to get started working online. That doesn’t mean it is without work. Get-rich-quick schemes don’t exist in my book, and affiliate marketing is no exception. You’ll have to put in some serious hours to earn a livable wage.

The cool thing is though, that you can start earning money in a short period of time (weeks if you’re a quick study). That’s much different from creating your own product and selling it, which usually takes at least a few months. It’s also much different from blogging, which seems to take even the best about a year to start earning anything meaningful.

Getting quicker results is a big part of staying motivated. Too many people quit online projects because they didn’t see results after a few weeks or months. With affiliate marketing that risk is less.

That’s my case for affiliate marketing as a complete business.

What else do you want to know about affiliate marketing? Advantages / disadvantages? Do you have experience as an affiliate marketer? Share your thoughts in the comments!

If you happen to be interested in the beginner’s course on affiliate marketing I’m putting together, sign up for updates over at AffiliateBeginnersCourse.com and I’ll send you a special discount when the course is ready (I’m sorry it’s taken so long!).

photo by Adam Foster | Codefor

Written by . Corbett is cofounder of Fizzle, a place for creative entrepreneurs, writers, makers, coders and artists, all working to support themselves doing what they love independently on the Internet. Follow Corbett on on Twitter.


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Karol Gajda May 5, 2010 at 2:07 am

Thanks for the shout out Corbett!

I’m glad you’re making the point that, while it may be easy, it’s not without work.

What I mean by easy is, affiliate marketing, at its essence is simply selling someone else’s product. Easy! But not. ;)

It does happen sometimes. You launch a campaign and it immediately hits $X,XXX/day. It *can* happen, but probably won’t.

In actuality, your first few affiliate marketing campaigns might not make much, or might make nothing. That’s fine. It’s a learning experience. Like anything, if you keep at it, if you keep seeking knowledge, you will eventually have success.

Cheers!
Karol

Corbett May 5, 2010 at 10:13 am

Easy, but not. That’s a good way to describe a whole lot of things in life, isn’t it? Easy to get started, hard to follow through is another way of putting it. Thanks for sharing your experience. I’d love to hear the story of the immediate $X,XXX/day campaign some time ;)

Diggy May 5, 2010 at 2:46 am

Hey Corbett!

Awesome information.
I can tell you that while it may be the easiest way to make money online, it is far from easy. I play around with affiliate marketing every now and then and recently started focusing on it more, but after 18 months I’m only making around $400 per month.

Of course I have long term goals that require more time to show results, like my blog for instance, but it definitely is not something that you can start with as a complete newbie and replace your current income within 6 months. (There are always exceptions though).

Cheers
Diggy

Corbett May 5, 2010 at 10:18 am

Hey Diggy, thanks for sharing your results. I’m sure that’s frustrating. I noticed though that you said you “play around with” affiliate marketing. I hope I didn’t imply from the article that someone could make big money just by dabbling in AM! Congrats on your success so far though, I’m sure your big breakthrough is right around the corner.

Anthony Feint May 5, 2010 at 4:42 am

I used to do a lot of affiliate marketing – sure I felt good about the money, but to be honest I wasn’t proud of my achievements.

I would rather work on my web app any day. Its something that I am truly proud of and keeps me excited.

Corbett May 5, 2010 at 10:21 am

I’ve done both AM and web apps too, and I can say there are pros and cons to each. Supporting a web app can become a very intense time commitment. It can also be harder to monetize a web app in this era of free software. That being said, it is definitely a fulfilling experience to build an application that people use and love. Unfortunately, most people aren’t equipped for software development.

The Dame May 5, 2010 at 7:44 am

About three years ago I discovered affiliate marketing while I was still living in the UK where it is big business. Personally, I never stuck with it because I didnt know how to build a site to support the adverts and I didnt choose something I was interested in.

Australia has a huge market for it so I think Im going to give it another look as Im passionate about spending all day online!

Corbett May 5, 2010 at 11:25 am

Some products are international as well. Don’t feel like you have to limit yourself geographically.

Marcin May 5, 2010 at 7:48 am

Great article! I agree that affiliate marketing can be a complete business.

@Anthony Feint

I believe it’s really important to promote only things in which you believe. Then, you will be proud of your achievements because you helped people in solving their problems and helped seller who made great product. It’s win-win.

Corbett May 5, 2010 at 11:23 am

Great advice. Thanks, Marcin.

Everett Bogue May 5, 2010 at 7:51 am

The most important element in affiliate marketing, for me, is selling things that you believe in.

I’m lucky enough to be blogging in a niche where other writers are creating excellent content that blows me away. Leo Babauta, Adam Baker, Chris Guillebeau, Viperchill, Tammy Strobel. The list goes on and on with awesome people who are selling their products via affiliate marketing.

The biggest trick in affiliate marketing is actually believing in the work you’re selling. Personally, I can’t bring myself to sell anything that isn’t going to help the people who come to my blog. This would dilute and/or destroy my credibility with my audience.

Corbett May 5, 2010 at 11:26 am

Yeah, Everett, there are some REALLY amazing high-quality products that have affiliate programs out there. All the ones you named are fantastic.

Annie Stith (@Gr8fulAnnie) May 5, 2010 at 8:57 am

Hey, All!

I wish everybody who has a site and uses one of those floating forms (like the one at your link) would have to try to fill one out on a BlackBerry. Know what happens? They float all the way past the margin as we zoom in to fill it out, making it impossible to do so! (I’m not just picking on you here–I’ve posted this complaint at several other sites.)

Corbett May 5, 2010 at 11:19 am

Sorry Annie! I chose a stock WordPress theme for that form. I’ll get around to replacing it before the course goes live.

Erin May 5, 2010 at 9:40 am

We are interested in slowly promoting products on our site that we really love. Do you have any tips for the best ways of selling affilliate products? Is writing a review, emailing your list and having an ad enough, or is there more that can be done?

Karol Gajda May 5, 2010 at 9:49 am

Erin: there’s no right or wrong way. I’m personally not a fan of ads, so I don’t use ads on my blog. But they do work.

The best sales will always come from a review, whether you post that on your site or e-mail it to your list. (or both!)

Keep in mind when writing a review that no product is perfect and you should point out flaws in the products you write about.

Chris Guillebeau recently used my review of Frequent Flyer Master as an example of a successful review inside the $100 Business Forum. I straight up point out something that I wish was in the product that isn’t and I still made a nice amount of sales. ;)

Corbett May 5, 2010 at 11:23 am

I agree about reviews. They can be effective for selling affiliate products, but only if you are honest and transparent about the product.

Other “special feature” types of posts can work as well. You can ask the author of the product to write a guest post, or have them participate in a special contest on your site. Interviews can be effective as well.

Karol is right though, just putting up an advertisement in your sidebar for the affiliate product probably won’t work as well.

The best answer though is to experiment to find out what works best in your situation. Don’t assume that what works best for us will also be the best for you.

Rasheed Hooda May 6, 2010 at 8:17 am

Great article as usual, Corbett.

I have been thinking about affiliate marketing for a long time, but I really haven’t committed myself to it. I think it is time to get committed and get started.

Thanks for the nudge, and thanks for creating the product to help us get started.

soultravelers3 May 7, 2010 at 8:24 am

Thanks Corbett!

Perfect timing for us as I’m very interested learning about selling affilliate products as well as making my own and working with affiliates. Four years into living and blogging about our open ended family world tour & we have gathered tons of unique information and not all of it can fit in my book ( or anywhere close).

Plus so many related niches from minimalists to homeschoolers to travelers have products that my audience will love. Always more to learn & do!

Dan Waggoner May 10, 2010 at 2:22 pm

I’ve had success marketing affiliate products online but I believe you can have much more success with your own product. All you need to do is have a great product and then get a bunch of affiliates working for you. Proper affiliate tracking software makes this possible.

Parker Lee May 11, 2010 at 5:59 pm

Corbett!

Good stuff, as always buddy! I have to say, I’ve never looked at Affiliate marketing that way before, my site isn’t even yet monetised.. I was thinking about just doing services, but see now that I’d be cutting myself from huge earnings.

Thanks buddy,

–Parker

Marc May 16, 2010 at 8:50 am

My business model is niche ecommerce. I like the idea of focusing on getting established in the search engines and finding a drop shipping to fulfill the orders.

There is no doubt in my mind the affiliate marketing is a sexier model. But my concern is you have to keep building sites to keep the income coming in. Maybe I’m wrong on this but a new product comes out and you spend time and money promoting it, but what is the products life cycle. Products on click bank become obsolete when the newest, latest and greatest product comes out.

Am I wrong on this, please hit my back with your opinion.

Marc

Corbett May 24, 2010 at 10:06 pm

Hey Marc, the problem you describe isn’t really an issue if you’re picking high-quality products to promote. In fact, it’s no different than if you had created the products yourself. You always have product life-cycles to contend with, whether you’re the product creator or an affiliate.

Rob (A Travel Affiliate) May 18, 2010 at 1:41 pm

I’ve had some success with affiliate marketing – in a market that I have knowledge and passion about – and I think that’s one of the keys.

There is something else too… and that’s being close enough to the end of the buying cycle, since affiliate marketing is generally done on a “last cookie wins” basis.

Corbett May 24, 2010 at 10:05 pm

Great point, Rob. It’s definitely important to be “close to purchase” as they say, not necessarily because of the cookie issue, but also because you can’t afford to pay for leads who aren’t interested in buying.

Greg Linster May 19, 2010 at 4:03 pm

Hey Corbett!

I’m currently trying to build a site using wordpress.org that I intend to use solely for affiliate marketing. I’m still relatively new to much of the html and java script jargon so it has been slow moving thus far, but I’m very cognizant of the potential here. Also, companies like Viglink (http://www.viglink.com/?vgref=1340) are a great resource to make sure you’re capturing revenue on every link.

Cheers,
Greg

Arif Zulhilmi December 11, 2010 at 6:58 pm

Yes, I do agree with you. The affiliate program is one of the best money making technique on the Net, for the time being. But, as we all knows, every single business got their own competitions. As many of the bloggers and other tech-savvies are starting their own mission to make money from this technique, do we realize that one day, the affiliate program will be saturated? There will be so many websites and blogs that put the advertisements and links, but no one is going to click it, because everybody is waiting for others’ click.

Lee December 11, 2010 at 9:20 pm

One thing about affiliate marketing is it’s much more work to get going than a lot of folks realize. But when you get a site working and making money, it pretty much continues to do that. So, the front-end is steeper than people think, but the back-end is sweet.

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