Affiliate Marketing - How to Earn a Stable Online Income From Affiliate Marketing.
By Hazel PAffiliate marketing involves promoting a service or product from another person or company (known as the merchant), and gaining commissions on these sales. This commission can be a single payment, or a recurring income which might be a result of a membership or similar payment plan.
Affiliates focus on promoting the merchants product through various mediums, often using a website and enticing visitors to pursue further information about the product, essentially with the aim of getting them to purchase it.
The range of commission offered differs from merchant to merchant, so there is no general percentage as it can range from 1% to 100%.
You might be asking, why would some merchants offer a 100% commission on their product? Because when the user buys the product, they are generally added to an email list, and the merchant can use this list to market future products.
Other notable affiliate methods involve the merchant paying the affiliate for each visitor the affiliate sends to the merchant's website. The commissions for simply referring a visitor to the merchant page are typically a lot lower and paid as a fixed fee; however, they do not require the visitor to purchase anything.
Recurring income programs can be an excellent choice, particularly if it is a membership program in which the merchant drip feeds quality content or a service over a period of time. If an affiliate chooses to promote a quality product that buyers are likely to wish to keep paying membership fees for, then the residual income can stack up quite high when a lot of conversions have been made.
Take care in determining which business model is best for you and the type of product that you are promoting in order to work out which sort of affiliate program is best for you. For example,
Merchant #1 - Single Commission for a $50 product paid at a 50% commission
For a single sale:
- Earnings after 1 month: $25
- Earnings after 12 months: Still $25 (in total)
Merchant #2 - Recurring Commission for a membership product for a $20 per month paid at a 25% commission
For a single sale:
- Earnings after 1 month: $5
- Earnings after 12 months: $60
As you can see, Merchant #2 offers a lot more money over time. Now consider if you managed to get 100 sales. After 1 year, you would have earned $2,500 with Merchant 1, or $6,000 with Merchant #2. It is evident that in this case, it would be smarter to go with Merchant #2.
However, take care to research the product you are promoting, make sure that there is a consistent trend for buyers to continue their membership for at least a few months. You don't want to promote a product that has buyers who opt-out of their membership after the first couple of months, as that will return fewer earnings than if you were promoting a product in which buyers became and stayed members for years.
In order select the type of affiliate program that is suitable for you, it is advised that you examine the product type, commission rate, and potential length of recurring commissions. Weigh the benefits of each type of program in order to determine which type of program will suit you best, and which type of program will provide the most income over a period of time.
While large single commissions may seem like the way to go, you should be building up as much income as possible over time, and recurring commissions will give you a stable income over the long-run and often end up making more income over time.
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