If you are looking into making money online, affiliate business opportunities are always going to be one of the top recommendations. This is because out of all of the business opportunities that I know of, affiliate marketing offers the greatest return on investment. There is very little initial investment in affiliate marketing, and the returns can be staggering – once you know what you are doing. But if you are new to the making money online world, you probably have no idea what affiliate marketing is. It is quite simple really. Affiliate marketing is driving customers to a vendor's website. Vendors who want to sell a product will offer commissions to affiliates who drive traffic to their sites. The vendor gives the affiliate a custom link that will track all customers that arrive to the vendor's website from a particular affiliate's website. An affiliate earns a commission each time a customer makes a purchase or performs an action after clicking on the affiliate's link.
There are three main types of arrangements used in affiliate marketing, which are listed below.
1. Cost Per Sale – This is the most common form, and as the name implies, an affiliate is paid each time a customer buys a product from a company after following a link from the affiliate's site. These are popular because they often pay commissions of 50-75%.
2. Cost Per Action – In cost per action agreements, instead of paying for a sale, the affiliate gets paid each time a potential customer completes a predetermined action after following a link from the affiliate's website. Popular actions include signing up for free trials, filling out surveys, or registering for a site. These do not pay as much as cost per sale arrangements, but can still be quite profitable.
3. Cost Per Click – Cost per click means that you get paid each time a visitor clicks the link from your site to the company's site. But due to factors like click fraud and low conversion rates, these are offered by very few companies.
The way that an affiliate chooses to drive visitors to a vendor's site can very greatly. I'll take a look at four ways affiliates drive traffic to vendors' sites.
1. Text Ads and Banners
The easiest way to get started with affiliate marketing is to place banner ads and text ads that point to your affiliate link. This really takes no effort other than setting up the banners the first time, and can be profitable. The trouble with them is that people know that they are ads, and almost always tune them out. I know that when I am surfing online I rarely even notice the banners on a site any more. So these are not as effective as some of the other strategies, but are very easy to implement.
Another way that people make money in affiliate marketing is through review sites. These often have domain names like productxreview.com or doesxproductwork.com. Affiliates then describe all the positives of the product to would be purchasers and then point them to where they can purchase the product through their affiliate link. Reviews are very effective because anyone looking for a review of a specific product is thinking about buying it. This usually leads to more clicks and more sales.
3. Sales Letters
Sales letters are usually much longer than review sites and are usually emotionally charged. Sales letters have catchy headlines explaining a great need, then go into great depth as to how a product is going to meet that need. With good copywriting skills, this can be the most effective strategy. However, most sales letter sites are not profitable due to inferior copy.
Testimonials are just what they sound like – a testimonial. An affiliate will talk about their experience with the product and explain how it has met a need or improved his/her life. These can be very effective if they do not sound too "salesy."
This just scratches the surface of affiliate business ideas, but I hope that I at least gave you an idea of what affiliate marketing is and how people use it to make money online. Stay tuned for more affiliate business opportunities and tips to be successful as an affiliate marketer.