Affiliate programs are an excellent way to generate income for your site or someone else’s, and it is a pretty good introduction into ecommerce, however but it's a numbers game. Basically, the more people who visit your site, the greater your chances become for creating a good income, especially if the programs you participate in are related to your site topic. Chances are you have probably come across many commercial sites that claim to offer the best affiliate program. What you will often learn is that this is simply not true.
So what exactly is an affiliate program, you might ask? An affiliate program is where a company offers to pay you a certain amount of money for either a click through from your site, or a fixed amount for a lead (where the visitor signs up for a newsletter, etc.) or a percentage of a purchase made by a visitor as a result of a click through. Even if the visitor does not make a purchase on the advertiser’s site right away, most programs will offer “cookie duration” of usually around 30-90 days.
The best way to try to explain this to you is to give you some of my personal experiences when looking for an affiliation program.
“When I first started searching for and implementing affiliations with various companies; it was one of the largest parts of time wasted during my day when it came to managing my website. I spent a disgusting amount of hours searching for suitable affiliate programs, implementing the links and then keeping track of what they did”.
If you are hoping that marketing a website affiliation is going to get you rich quickly, forget about it. You will have to spend a lot of time in your project if you want to make it work for you. Then again, all money making ventures do, just ask Donald Trump.
“Of course, the income that was generated from each program was actually pretty low at that time because at that time the number of visitors to my site was not high either. With this in mind, it was not particularly uncommon for companies to disappear on me without warning me about it and since most affiliate programs only pay out at around the $25 mark, I would lose a lot of revenue in the end.
The other part of affiliation that I was not happy with was the idea of another companies banner’s being plastered all over my site, if you place too many of them on any given page it only serves to confuse and irritate your visitors. think about it; how do you like it when you visit a site. Any more than one animated element on a web page can be very distracting which leaves you with nothing gained at all, and many affiliate programs insist upon this type of bargain when signing on. By now, you must realize that I learned a lot just by trial and error.
Affiliate tracking can also a problem. After you have successfully applied to become an affiliate for a company, they will usually supply you with some personalized code or link. It is very important that this code is implemented correctly into your page; because otherwise you may be sending the company visitors without being reimbursed. Most snippets of code contain a unique user id; which is used by the company to distinguish which site sent traffic. Even if you do implement this code in the right way, it has been my experience on occasion for it not to function correctly”.
Having heard of my experiences, you can see why I would not really recommend that you hunt around and sign up without much research and thought first when finding a good affiliate program. Your time is too valuable and could be better spent creating content and updating your site. But there are some excellent individual companies offering affiliate programs out there.
What I have discovered to be very successful is to take advantage of companies like Offers Quest or Google for text link advertising. Text links are a great resource as they are bandwidth friendly, and when they are implemented properly add valuable content to your site which can also assist in search engine rankings.
When it comes to website affiliation, you will also need to know how to conduct a market study because this is how you will find your target audience. Without a targeted audience, your marketing campaign will not be effective. Below I have begun to give you an outline of what you should include in your market study. It is best to write it down; especially if you are hoping to entice someone else into investing in your marketing venture. That and it is a good way to keep track of your objective and provides a good guideline of what needs to be done.
1. Your Objective to the Research
Explain in one paragraph why the research is being done, what you hope to learn and for what purpose the information that you attain may be used2. Description of the Market
This should be general like one paragraph
Who is your Target Market(s) Why you chose this particular market Get a complete profile of your market (e.g., demographics, psychographics, behaviors) What benefits does your market seek (i.e., what points-of-pain or problems are being solved) What factors can affect their decision to purchase or use your product/service What attitudes do they have about the products/services that are currently not on the market How is the product used Products and Services that appeal to the target market In general terms, what is currently so appealing to this market If there are no current providers, what types of products/services may appeal to this market in the future (i.e., what is used now to solve the problem).
3. Market Metrics
Get many Size estimates (current and future) for all of the following: Overall market Current size as it stands Potential size for the future Actual penetration of current products/service within the entire market
Individual market segments Current size Potential size Actual penetration of current products/service within the total market Usage rates Frequency of product purchases Growth estimates (current and in the future) for: Overall market Individual market segments
4. Competitive Analysis
You must include a Summary of who your Current Competitors are
Listing the competition by market share ranking (by each target market if possible) is a good way to size them up. You can also be more specific by searching for individual points listed below.
Current Competitors - full analysis of top competitors including:
Products & Services (e.g., description, uniqueness, pricing, etc.) Their Market share at current Current customers (targeted audience) Positioning and promotion strategies Partnerships/Alliances/Distributors Recent newsSWOT Analysis - Strengths, Weaknesses, Opportunities & Threats
It is extremely important to focus attention on the SWOT section of this report. While most other information in this report can be gleaned from company and secondary materials, much of what appears in the SWOT section is based on the researcher’s own opinions of the competitor based on the information that is collected. Consequently, this is often one of the hardest areas of the report to write as well.
Potential Competitors (any competition in the future)
You will need to get an explanation (though it need not be as detailed as Current Competitors) on who they are or maybe and why they are seen as potential competitors5. Additional
Extraneous Variables- Discuss factors that may affect this market (e.g., technological,social, governmental, competitive, etc.)
Market Trends and what is expected to happen in the futureIf you can follow these basic tips for finding and selecting your target market, you should be ready to search online and check out the competition and their rankings in the search engines. Below are some general guidelines for you to follow in creating your competitive analysis which is the most important factor in being an affiliate marketer. Knowing your competition just as well as your audience is the key point which is going to keep you on top of the competition.
The competitive analysis section works best when it follows a format like the one that is shown below. In general, I would recommend that this report would be made about each of the major competitors. While most of this report is intended to focus on the overall analysis of the competitor, you should recognize that you are primarily interested in how this information may impact your company and, specifically, a product or product line to you affiliates
For this reason, you should make sure, where possible, to focus your information on how it impacts the markets in which your products will compete with theirs. That is how your report will stand out among the other marketing affiliates in a merchant’s eye. It should be included in your proposal whenever it is possible. I have listed the guidelines in sections to make it easier for you to read and then furthered the report guidelines for you as well for easier reading.
Please note each sub-section within a section will contain 1-5 sentences that explain the sub-section.
General Company Information which includes name, location (headquarters, other locations of importance), website address Summary of the Business which includes a section that will summarize the company, business units and the general nature of the business Business Overview should include sections on the history, ownership structure, types of businesses, mission, strategy/objectives, and key executives Recent News/Developments such as important company developments within last 6-12 months (e.g., reports from news sources, press releases, financial statements) Financial and Market Share Analysis – includes sections on corporate performance, trends, market share for product Marketing in general should include sections on products and services that are offered, target markets, positioning, customers/users, pricing model, promotional efforts, sales force, and distribution Other Miscellaneous Issues like adding sections on technology capability, partnership arrangements, and intangible issues A list of your Competitors where you will list key competitors facing this company SWOT – strengths, weaknesses, opportunities and threatsBelow, I am going to actually pin point what should be included in the market study like I did above, however in more detail and with explanation on how to write it. I am listing them in steps rather than points to make it easier.
1. The information that is provided in a market study should be based on the research that you have collected AND NOT on one’s own perceptions, guesstimates or other unsupported statements. This information should be based on fat alone! The only exception to this may be within the SWOT analysis; however, even most of this should be supported with some evidence.
2. If you are unable to find any specific bit of information it is probably a good idea to make this known so that the person reading the report would know of this potential limitation of the market study and be ready for it. Obviously you need to collect good research so you do not end up having too many of these statements.
3. It is generally a good idea to define the most important terms and concepts when you first introduce them so as not to confuse the reader. This will benefit those reading the report who may not already possess knowledge in this area. Alternatively, you can create a glossary or definition section in the Endnotes area of the report.
4. Wherever it is necessary you should explain how the research was conducted or how data was collected (e.g., explaining how survey was done). This just helps the reader to understand your methodology so that they can decide how trustworthy the information is.
5. Make note of any limitations of secondary research (research you obtained from other sources) that you used. Unless there are very any significant limitations you can generally include this as an endnote.
6. If you are investigating a new/different way of doing something with present customers, then you will need to provide a discussion of the cost/benefit of alternative options. That is, what will customer give up to use something new versus what they will get from using the new product?
7. Remember to reference as much stuff as you have to in order to get the best information. I would suggest using endnotes instead of footnotes of texts because this gives you the most accurate account. Endnotes appear next to the sentence, word, quote, number, etc. but usually not as a superscript and usually in parenthesis like this (1). The full reference would appear at the back of the report in an Endnotes section.
Once you have completed your market analysis and target audience, you will want to present it to the companies that you are looking to affiliate with. That is what the next section deals with. It is going to show you how to create partnerships with the merchants.
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