Who else wants the secrets to making $12,800 per week, surfing the web?
So goes the big promise of affiliate marketing.
Make a whole bunch of money. And you don’t have to run a business. You don’t have to fulfill products or services. You don’t have to deal with customers. You don’t have to do much at all, besides put up a website. And suddenly, the cash comes rolling in! Automatically… Make money while you sleep!
Let’s chat about that today, shall we?
It’s Monday, which means I’ve opened up the ol’ mailbox, to answer YOUR questions.
What’s your burning question or challenge you’d like help with? Shoot it to me at [email protected], and I’ll answer it in a future Mailbox Monday.
Here’s today’s question…
As I get the sense you deliver an honest, no BS approach to your content, I was very interested to learn your thoughts about affiliate marketing.
I’ve been researching internet / affiliate marketing for quite some time and after conducting multiple reviews I think I’ve found a course that looks promising. Due to the trust that’s developed in you and your brand (from seeing you around the internet for a while) I’d be interested to know your opinion of the following course if there was a chance you might have time to briefly check it out and provide your first impression?… 🙂
[[ Roy: Removed the specific course here. ]]
Obviously no obligation! I just thought I’d take a chance to reach out and follow up about one of your articles that was of interest to me.
Thanks for your time Roy,
First, here are the big takeaways from a previous article I wrote on affiliate marketing…
First and foremost, most affiliates don’t make much money. It probably follows “the 95/5 rule.” Which means 5% of all affiliates are taking home 95% of the promised cash. And most of that is going to the top ONE affiliate out of every hundred, who is raking in $90.25 out of every $100 paid out.
If you’re not in that top 5% and really the top 1%, you’re going to find yourself making almost nothing from all your affiliate efforts.
Second, if you do choose to pursue it, it’s going to take all the same work as building your own business. You’re going to have to figure out traffic, conversions, economics, and more. You’re going to have to learn to attract buyers and direct them to offers. You may have to start investing in paid advertising, and building an email list, and so on.
In other words, you’re going to be doing ALL THE WORK of starting your own business, but you’ll end up with… A portion of the revenue, and ZERO ongoing relationship with the customers.
That last part is really important…
Now let me rant for a minute about who really makes money from affiliate marketing…
Aside from the super-affiliates who run their affiliate marketing enterprise just like any other business, there are two types of people who make a good amount of money from affiliate marketing.
First is the sellers.
These are the people who built a real business, selling a real product or service, and have recruited armies of affiliates to try to help them sell their goods. They don’t care if YOU make money, they just want a lot of affiliates. Because more affiliates means they’re more likely to get that ONE affiliate who really knows how to move the needle.
They might raise an affiliate army 10,000 strong, knowing they’re only going to ever pay very much to 100 or so affiliates. The rest are mostly bits and bytes in a computer, an account in their affiliate software, and never get any payment at all.
They make money because they understand having an army of affiliates is a traffic strategy that you only have to pay for after it generates sales. Paid advertising is a pain because you have to figure out how to make it profitable if you want to scale it. Organic traffic requires a lot of front-loaded work, that may or may not pay off.
But if you’re able to raise an army of affiliates hocking your wares for you, you may be able to turn on a lot of traffic, fast, and only have to invest in that traffic AFTER it makes you money.
Second is the biz-opp marketers.
One way to make your product or service almost totally irresistible is to promise a believable but near-magic result for your customer.
Pitching weight loss, this is the miracle pill that sheds those unwanted pounds, without effort or side effects.
Pitching relationships, it’s the three magic words you can say to your partner to have their heart palpitating for you, like a crushing teenager.
Pitching moneymaking schemes?
How about “make money in your sleep, no work, no customers, no products or services, no headaches, no fuss” … ?
Sounds pretty good, huh? Well, that’s EXACTLY what biz-opp marketers sell to you, to get you to really, really want to buy their course on affiliate marketing.
And you know what? Many of them are not lying. They probably did actually make the money they claimed. But that’s because they’re super-affiliates. They’re the 1-in-100.
And still, they’re turning around and pitching you what? Someone else’s product? Nope. They’ve actually created and are selling their own product on affiliate marketing…
Because that’s actually better for them!
Again, not saying anything bad about any particular program. I’m just saying you need to pay attention to what they’re doing, not just what they’re saying…
I’ve made some money here and there with affiliate marketing.
I’m not saying there’s no money in it. And in fact, there’s a TON of money in it, if you’re willing to be:
- A super-affiliate, who builds a real business around it…
- Someone who uses affiliates to get traffic for your real business…
- Someone who builds a business teaching others to be affiliate marketers…
(Quick note about #3: There are people who I know that play ethically in this space, but if you haven’t legitimately made good money as an affiliate with a system others can copy, you should stay away. Don’t be sleazy.)
Otherwise, your time is really best-spent building a real business, with real products or services, that you sell to customers you are building a lifetime relationship with…
It takes about the same amount of effort. There’s the same amount of sweat, hardship, pain, suffering, endurance, tears, and work…
If you’re building a business based on affiliate income, here’s what you’re doing…
You’re like a sign-holder, getting paid to stand on the corner, bringing people into someone else’s business. You might be important to get them in the door, but you’re mostly forgettable. Once the customer has the relationship with the business, you’re out of the picture. You get paid (sometimes a lot) for the first transaction. But you don’t benefit from the most profitable part of the relationship, which is all the future transactions the customer is likely to have with that business.
Alternately, if you invest in building your own business and your own relationships with customers, it will take more work up front. Figuring out your products, services, and offers can be a substantial task. But when you start selling and building relationships with those customers, you’ll realize they’re happy to come back over and over again. And the profit of a lifetime relationship will be far greater than the more-passive income of getting paid to push traffic.
The one exception…
All this said, I do have one big exception in the “don’t be an affiliate” rule.
Specifically, being an affiliate for others can be a great way to augment your core business.
Let me give a couple examples.
Let’s say, first off, that you want to test a market.
But you know the expense and effort it will take to develop a product for that market. You’re not sure about the market, your ability to gain traction there, and other important details you might want to form a more sound and solid plan based on.
So you use affiliate marketing as a way to test the market. You pick out a few high-quality affiliate offers that align with your interest in the market, and that are similar to what you’d probably create if you decide to go deeper. You get set up as an affiliate. You build a website. You build a sales page and email follow-up campaign. You start buying traffic, and testing. After a few thousand dollars invested, you can start to see how hard it is to get traffic, how the offers you liked were converting, and so on.
Then, based on this, you decide to build out your own offer, product, or service, for that market. You adapt your marketing to sell your product or service, instead of someone else’s. And you benefited from an easy-entry way to test the market. (Or, if it didn’t work, you saved the effort and expense of building an offer that would eventually fail. Hurts less when it’s someone else’s product, too!)
Alternately, affiliate marketing can be a great way to bring more value to your customers…
Let’s say, on the other hand, that you have a successful, going, growing business. You have great relationships with your customers, based on trust. They trust you, and would be happy to get more from you.
But, you’re also limited. You’re limited in the amount of time and effort you can put into developing more products, or what your customers need most is outside of your area of expertise. But at the same time, there are trusted vendors whose products you see as matching yours in quality and value. In fact, you’d be as happy to stand behind their products with an endorsement as you are to sell yours.
So, that’s what you do. You strike up an affiliate or joint venture deal, and you offer their products or services to your customer base. This gives your customers access to a valuable offer they may not have known of otherwise, it brings your partner new customers with very little effort, and it allows you to maximize the value you’re getting from each customer you have a relationship with, without building more products or services. Win-win-win!
Beware the allure of easy money.
It’s not that money should be hard to get. It’s not that there’s no such thing as easy money.
Heck: every time another BTMSinsiders member renews for yet another month because I continue to add value to the training library there, it FEELS like easy money.
This weekend was my kids’ fall break from school. On Friday, we went to state park, a little over an hour from our house. We were off-grid most of the day. When my phone re-connected to the internet, and I got notifications of all the BTMSinsiders member renewals that happened while I was out hiking with the kids, that was fantastic.
If that’s the FEELING you want, first figure out how to build a real business, where you’re offering products or services in exchange for money.
Then, do that well, and start to build relationships with your customers, such that they want to keep coming back to you.
Then, find a way to make as much of that business as possible automated and outsourced.
Long-term, you can even build the business in such a way that you’re no longer in the organizational chart, or at least you only remain involved in a strategic way, or in whatever way reflects your own unique abilities.
It’ll be fun to do.
And one day, you’ll wake up and realize that a whole bunch of the money you make, once-hard, is now pretty easy.
That’ll give you the feeling. And it’s a sure way to avoid most of the traps of affiliate marketing.
Yours for bigger breakthroughs,