1. What is affiliate marketing?

Affiliate marketing is a promotion and income generating system where you, as an affiliate marketer, earn a commission for promoting a product or service.  The most frequently used payment arrangements include pay-per-sale, pay-per-lead, or pay-per-click compensations.  Affiliate marketers generally operate by owning a website where they drive traffic and sales to their represented companies.

For example, if you represent a clothing manufacturer like L.L. Bean you would have a website dedicated to clothing or outdoor wear.  Your website could use a number of tools including content with embedded links, banner advertising, and promotional content to encourage your website visitors to click your designated link through to L.L. Bean.  Depending on how you’re compensated, if the visitor then makes a purchase at L.L. Bean you are compensated a percentage of the sale.

Affiliate marketing is credited to have been developed by CDNow.com and Amazon.com.  Experts were initially critical of the programs however Amazon claims more than 1 million affiliates worldwide.

2. What can I expect to make as an affiliate marketer?

There are many naysayers popping up who say that affiliate marketing is on the decline.  However, many affiliate marketers will tell you this just isn’t the case.  There is still a tremendous amount of money to be made as an affiliate marketer.  How much you make is largely dependent on your compensation agreement, your chosen niche, how much work you put into your business, and your competition.  Experts agree that the key to affiliate marketing is to stick with it.  Profits will increase as your business and website grow.

3. What are expected start-up costs?

One of the benefits of being an affiliate marketer is that there are very few startup costs.  Basic startup costs include a:

• Website• Domain name• Computer• Phone• Fax/efax

If you already have a computer, then the startup costs are extremely minimal.  Other costs will include writing copy for your website.  You can write your own copy to minimize these costs.  Advertising, including Pay-Per-Click campaigns and placing banner ads in ezines and relevant websites is a great way to send traffic to your websites, however it can be costly.  When placing ads or using PPC, consider starting small to keep costs low and test your campaigns to optimize return on investment.

4. What skills do I need to be successful?

To be a successful, and profitable, affiliate marketer will want to have some basic research skills.  What are you researching?  Plenty!  Obtaining the keywords that will generate the most profit, the products that will sell the best and pay well, which advertising and marketing means will work best for your products, and most importantly…who your target market is and what they want.  

5. How do I choose affiliate marketing programs?

You can find appropriate affiliate marketing programs online via search engines, by visiting companies you’re familiar with and respect, and by searching affiliate directories.  Before you sign up with a company here’s what to look for:

• High quality products and services.  Respect your customers and only endorse products you believe in.  If you endorse an inferior product, you will lose the respect of your customer.  There are thousands of quality companies available, there’s no reason to endorse an inferior product.

• Look at the merchant’s side and make sure ordering and fulfillment processes are handled professionally.

• Ask the merchant about their conversion ratio and investigate their sales copy.  Your time, you’re your customer’s time is valuable.  You want to send customers to merchants who are able to close the deal.

• Commissions.  How will you get paid?  Do you get paid per sale or paid per lead?

• Support.  All affiliate support will be detailed in the company’s affiliate guide.

• Look for companies that provide sales and marketing materials for you to use in your promotions.

• Tiered Commission.  Do you get paid for recruiting affiliates?  Some companies pay you if you send them affiliates.  This is called a two tiered commission and it can generate tremendous profits.

• Cookies.  How long will your cookies last?  Generally, most companies offer cookies that last 30 to 90 days.  A 60 day cookie means that if your customer visits a company website and then comes back 59 days later and makes a purchase, you get the commission.   

6. What is an affiliate network?

An affiliate network is a company that essentially works as the mediator between the company offering the product or service and the affiliate marketer.  An affiliate network company will provide sales tracking, click through rates, conversion statistics, and will often issue checks and handle payments.

7. What are cookies and why are they important?

Cookies are small text files set up on a user’s computer.  How long they stay on the computer is called the cookie life.  If you’re an affiliate marketer, cookies are important because they determine if you are paid for a visitor’s purchase or not.  When a visitor comes to your affiliate website, a cookie is placed on their computer.  If they then visit the merchant site during the life of the cookie you, as the affiliate, get the commission. If they visit the merchant site after the cookie has expired then no commission is paid.  This is why lifetime cookies are valuable to an affiliate marketer.

8. What are text links and why are they important?

Text links are the hyperlinks to the product or service you’re promoting. They only have text in the body of the link, rather than a graphic.  They’re generally embedded in your copy.  I’m sure you’ve read an article and there are several links scattered throughout.  These are text links and they have proven to work significantly better for click through rates and conversions than banner advertisements.  Banner ads, while they are still effective, are not as effective as text links.

9. How do I make more profits?

One of the absolute best tools to make profits as an affiliate marketer is content.  Advertising is important, a niche market is important, quality products are important, tiered affiliate programs are important, and a portfolio of a variety of products is helpful but the number one tool for more affiliate profits is content.  Content drives traffic to your website.  Content provides value to your visitors.  Content helps your website get ranked on the search engines.  Content sells your products and services and drives traffic to the companies you represent.  Content gives you profits!

What kind of content works best?

• Articles• Blogs• Reviews• E-books• Reports• E-Zines

10. What are banners and why are they important?

Banners are the graphic advertisements you see on many websites.  Most companies will provide you with banners of a variety of size, design, and with varying copy.  For example, when you join an affiliate program you will often receive an basic affiliate link which may simply advertise the company logo and have the words “Click Here” or “Buy Now.”  You’ll also likely receive a promotional banner which may have a discount off of the product, free shipping, or highlight a new product.

Banner ads are excellent resources as advertisements in e-zines and relevant websites.