What is an Affiliate?

[bemyself]

Hi all,

I'm brand new to the forum and read Tim's book for the first time just a few weeks ago. I have no business experience or education - I have always been someone else's employee or a student of liberal arts and landscape architecture.

I know I'm going to sound a bit ignorant here but what is an affiliate? How does that whole thing work?

Thanks for the education!

[Vacman]

bemyself,

The concept can be kind of confusing.

But...

A simple explanation = Affiliates are people who sell other people's products and get a comission.

You can be an sales person a.k.a. an "Affiliate" for a bunch of companies like Amazon.com and other similar big online companies.

You can also be an affiliate for smaller companies who sell 1 or 2 products.

The process basically works like this:

-You become an affiliate promoting a product(s)
-You put a link to those products on your website with your afflilate "code" so the company knows you sent them there.
-If they buy based on your recommendation, then you get a percent.

Affiliates are really basically sales people.

Hope that helps!
-Sean

[bemyself]

That helps a great deal.

I would guess that to be an affiliate most companies would like you to have some sales experience or be able to prove some kind of sales record or volume?

It sounds like a less effective way to earn a reasonable income unless you're a natural promoter.

But like I said I have no business experience - just a short spell as a car salesperson which I was not very good at.

[Vacman]

bemyself,

Most companies want good "internet salespeople" but they'll almost always let anyone promote them as an affiliate.

The reason why is because the company pays nothing for your time. They only pay you if you sell something.

That way the company really has nothing to lose by letting you promote their products.

[italian_job]

Hi There,

Affiliate marketing really is where you learn the basic skills of online marketing. It can give you some cash, but it will not give you income stability and piece of mind because you will always have to chase a BRAND NEW customer every time you make a sale. But affiliate marketing is a very easy way to start (but since there is no barrier to entry, the competition is EXTREMELY tough...so get ready).

Most of the affiliate programs are "1 level" systems, which means that you can only make money in selling the products.

Multi-tier affiliate programs instead allow you to teach other people how to sell online, so that when they sell, you get a cut too of the sale.

If I had to start today in affiliate marketing, I would stay focused on something very simple:

1) chose an affiliate program that pays you at least 50% of the sale. Most of the times those will be info-product, so you will sell either ebooks or software

2) learn all you can about pay per click, which really is the best way to discover how to drive laser targeted traffic to your site. Open a google adwords account but also a MSN paid search account and a yahoo US, Canada and Australia search marketing account. There are many places on the web were you can get $50 coupons or so.

3) learn to build simple html pages, as well as the basics of email marketing (aweber is a great autoresponder)

4) read read read. Invest in good quality books that explain you everything about what discussed at points 1 to 3. If you can, get a mentor that can explain you everything. I was fortunate enough, during my early days as an online marketer, to have a very good friend of mine who took the time to explain you the fundamentals of pay per click and how to build websites that sell. Since getting into affiliate marketing is so easy and doesnt have any barrier to entry, there is a ton of competition, and this is testified also from the raising bids of pay per click advertising.

5) be patient, set aside a small budget for advertising purposes, and make sure you TEST everything. Testing is the name of the game.

You will read in this forum that many people on this site want to start their own nutritional supplement company (and simply because they want to copy what Tim did). Dont get me wrong, copying from the best is a safe road to success, but you have to build your skills gradually. It took him 10 years to get where he is. Starting your business building your own product from scratch to me is total madness, because you must know so much before building your own product, dealing with suppliers and health governamental regulators etc. What if then your product is illegally exported into another country where your product has not been approved? Are you ready to take on the legal challenges? Do you have the financial resources and the skills to do that?

Among the many online ventures I am involved with, in fact, I am also a distributor for nutritional products, and I am very familiar with the issues of import/export and local governmental supplement regulations, and I can assure you that it is a mine field. I partner with a top class giant NYSE-quoted company, so even though I turned over $150k in 2007 dropshipping products, I am still learning a lot, and I am now teaching other people how to do the same (one of my distributors has retailed more than $8k in January 2008, and I am very proud of him!).

So, again, start with affiliate marketing. It is a fantastic world!

But then SLOOOWLY take a look into selling CONSUMABLE products, using DROPSHIPPING, because that's the only way for me to build a STABLE income based on RETURNING customers and REFERRAL business.

Let me repeat this point again, because it is KEY. With affiliate marketing you are paid a commission every time a NEW customer makes a purchase clicking on your link. If that person buys again from the merchant, you dont get a commission.

If you instead build your online business selling CONSUMABLE products via DROPSHIPPING, then you can build STABILITY. And to me with stability comes piece of mind, and the ability to relax and enjoy your life.

I am a VERY conservative person, so I like income stability. Affiliate marketing can not give you stability because you will always have to chase the next customer, it is all (and only) about customer ACQUISITION. Customer retention doesnt exist in affiliate marketing.

Hope this helps!

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