In Part I of \”Best Internet Marketing Strategies\”, I described some basic guidelines for creating an effective Internet marketing strategy for product and service based business models. In this column, I would like to analyze on the internet affiliate marketing and how one can compete in the sea of affiliate arbitrageurs.
What is on the internet affiliate marketing? On the web affiliate marketing, for the purpose of this writing, describes the act of marketing a product or service that is owned by someone else for the sole purpose of making a commission or some other satisfying equal benefit.
Generally talking, most successful affiliate strategies employ arbitrage as a model for monetary gain. That is purchasing one resource that can be immediately resold for a profit. You probably have come across some on the internet models such as these:
? Affiliate Networks- ClickBank or Commission Junction ? Lead Generation Networks- home, auto, medical, mortgage, etc. (www.insureme.com) ? Advertising Networks- Google\’s Adsense or Yahoo!\’s Advertising
Similar Strategies, Worlds Apart On the internet affiliate marketing strategies are very similar to traditional product and service strategies in that the basic fundamental marketing concepts apply. One still must consider variables such as: 1. Budget 2. Regionality of market 3. Target audience 4. Core competencies 5. Website (functionality, ease of use, and conversion friendliness)
The context however differs in that the \”action\” takes place on the affiliate or partnering Website. Therefore, the above variables must be invariably in sync with the value proposition of your affiliate and communicate joint benefits. The Website objective on the other hand, is to seamlessly transfer prospective buyers from the partnering site to the affiliate in a way that maximizes conversion behavior. In contrast, traditional on the internet strategies typically aim at keeping the visitor on the page and thus making the content sticky.
Benefits of Online Affiliate Marketing One of the major benefits affiliate marketing is lowered risk. Risk in this marketing model is shifted to the affiliate whom assumes risk for ultimately creating and maintaining the sale.
Another equally attractive benefit is that partnering site is exempt from carrying any Inventory and only must focus on on the internet marketing efforts.
Lastly, online affiliate marketing can be lucrative when successfully executed. For some Websites, this is the only source of revenue, which can even surpass the sites primary objective.
\”Work from home and earn $1000\’s while you sleep!\” Its simple money, so why doesn\’t everyone do it? Unfortunately, the Web is full of too many get rich quick programs that promise huge returns in exchange for little effort. You know…the American way! But in the sea of affiliates there do lie opportunities for those who are willing to work form them. However, affiliate marketing is not for everyone. Just like any other strategy, it requires a great deal of thought and resources to market successfully. If you\’re looking for the get swift riches, it\’s a die-hard game that\’s played best by the ones who wrote the book.
Affiliate strategies can also be difficult to execute given the amount of affiliates competing against one another. In addition, this increased competition inflates marketing costs associated to the advertising vehicles used to promote the affiliate. For example, if you plan on advertising via pay-per-click, keyword costs can be very high for generic terms thus pushing affiliates to purchase keywords that carry less competition. When many affiliates go to purchase the same keywords, this in effect inflates the keyword market. Worst of all, more money for the affiliating site means that keyword costs will continue to rise.
So how can I compete? If your going to compete in the affiliate world, there are two key factors that will equal success: 1. Quantity of quality targeted traffic that provides ROI 2. Solid on the internet objective in persuading visitors to click on your affiliate sites
The first factor relates to how relevant your audience perceives your value proposition in relation to what they are seeking. Quantity refers to the amount of targeted visitors you can attract that works to your ROI model. The most successful affiliate marketers can calculate their ROI attributed to their online marketing efforts on the micro level. Moreover, if the ROI is determined to be positive, the game swiftly turns into numbers.
The second factor relates to how well your Website can persuade visitors to click on affiliate links, which in turn means commissions. However, without executing the first key factor successfully, all the traffic in the world to your affiliate will not translate into the desired outcome. Here are some things to think about when optimizing your website for your affiliate strategy:
1. Website communicates similar value proposition of the affiliating site 2. Website clearly directs traffic off site to the affiliate 3. Advertisements and marketing efforts are in sync with the website objective 4. Website is resource oriented and not \”spammy\” 5. Website look and feel is in keeping with competitor sites
Summary Finding the ultimate online affiliate strategy can be challenging. After all, if it were easy, not only would everyone be doing it, they also would be making tons of money. I advocate that you first begin by examining the affiliate\’s chosen business model before diving in with both feet. What is their value proposition? How can you make use of that proposition, yet still be one-of-a-kind in the market place? (If your not, who would want to do business with you?) As I said earlier, affiliate marketing is not for everyone. However, you your strategy is solid, you might find yourself writing the book for others to follow.
About the Author
Christian Del Monte: creator of iBlogMarketing Internet Marketing Blog and Director of Operations for TMA E-Marketing has a B.S. degree in Marketing from Minnesota State University, Mankato. In addition, Christian has over 10 years in personal sales experience and has directed the operatio