Affiliate Marketing What Is It And Why Use It?

Affiliate Marketing is having Affiliates do your Marketing for you. What I mean by Affiliate is someone who tells people about your product/service and you pay them for a desired response, such as a purchase.

Affiliate Marketing is one of the best ways to get the word out about your product/service.

The best way to pay Affiliates is pay per sale. This means that you only have to pay your Affiliates when they actually make a sale. This reduces your advertising costs dramatically. your Affiliates take on all the risks so you don't have to worry about wasting your money on advertising which may not produce any results.

Using Affiliate is a very cheap way to advertise, however it is very effective. The software required to start up your own Affiliate program can cost only about $50 per month.

Then after that just wait for people to start promoting your product/service for you.

Please remember that 5% of your Affiliates will do 95% of the selling. What I mean by this is that most of your Affiliates will just sit there and do nothing. This can be countered if you teach them what to do, exactly how to do it and providing everything for them so they have to do as little work as possible.

To find out about teaching your Affiliates please see the "How To Super Charge Your Affiliates" article

You don't have to use this form of advertising just to sell your product or service. You can also use it to grow your opt-in mailing list. This is discussed in another article.

How Much Should You Pay Your Affiliates

How much you pay your Affiliates really depends on how much your product/service costs, its profit margin, how much you're willing to give up and what action you want to take place.

Lets say that your product is priced at $100. Lets also assume that it cost you $10 to make it. This leaves you with $90 profit.

How much of this do you want to give away to the person that made this sale possible?

Personally, I believe that you should give a rather high percentage of the profits back to the affiliate (Depending on how many sales they regularly generate), because without them, you wouldn't have made that particular sale at all, so reward them for it.

A fairly decent reward is about 50% of the revenue generated. Your product is priced at $100 so a $50 commission is quite generous. It really depends on your other costs (such as a mortgage) you have, which would help decide on a fair commission to both you and the Affiliate.

Another factor which plays a part is how much additional advertising you do, such as pay per click. For example, if you rely solely on your Affiliates to Market for you, then you may want to reduce the commission you pay to them to help you survive. However, you may want to pay them more, to encourage them to send more sales you way. It really is a judgment call.

On the other hand, if you advertise in other ways effectively, then you can afford to pay higher commissions, because you're not putting all your eggs in one basket.

In the end it's all down to how greedy or generous you are. The best advice I can give you is to pay the affiliate what you think he/she deserves. Hopefully that way everyone is happy and earning their fair share.

That is the key to a successful affiliate program.

By Stephen Warren, the creator of http://www.marketershandbook.com, the completely FREE guide to marketing online, with useful articles and links.

Hurley: YouTube Looking for Affiliate Revenue Streams
NewTeeVee, CA - Jun 26, 2008
... dinner in Palo Alto, but he went onto lay out an argument that there’s also a growing opportunity to make money from direct response affiliate deals. ...

Share Results Launches Affiliate Programs for Tellfon and ...
Emediawire (press release), WA - 15 hours ago
Tellfon is offering a tiered commission structure, as well as prizes for its top-performing affiliates. ElectionKeychains is offering a revenue share that ...

PR Web (press release)
Google Affiliate Network
CNET News, CA - Jul 1, 2008
MacFarlane, who will receive a percentage of the ad revenue, told the newspaper that the two-minute episodes would be "animated versions of the one-frame ...
AOL’s Platform-A Offers Guaranteed CPM for Bebo and Facebook ... Business Wire (press release)
all 28 news articles

W.Va. casino operators focus on business
Pittsburgh Tribune-Review, PA - 6 hours ago
Jacobs runs a Cleveland-based affiliate, Diversified Opportunities Group, which invests in gaming companies, according to Hoover's Inc., which tracks ...

Corel pleased despite 60% tumble in net income
London Free Press, Canada - Jul 4, 2008
In March, Corel's largest shareholder, an affiliate of San Francisco-based Vector Capital, offered to take the company private again. ...

Cooperation will lure the Phantoms
Allentown Morning Call, PA - 12 hours ago
The Phantoms, a member of the American Hockey League, are the top tier affiliate of the Philadelphia Flyers. Two local developers have expressed interest in ...

HipCricket Hires Vice President of Sales and Client Development
Eastside Business Journal, Washington - Jul 1, 2008
At CW affiliate KSTW Television, McCormick served as general sales manager and delivered an eight percent increase in station revenue, more than double the ...

YouTube's New Groove
Motley Fool - Jun 27, 2008
Is affiliate marketing the missing ingredient? It seems Google's going to give it a shot, according to YouTube co-founder Chad Hurley's recent comments at a ...

ValueClick: Has the Hunted Become the Hunter?
Seeking Alpha, NY - Jul 3, 2008
Think Partnership (hereinafter THK) is in many respects similar to ValueClick, albeit a smaller version as it is most widely known for the affiliate ...

Revenue Gateway Hires Theng Kuoch as Director of Strategic ...
Market Wire (press release) - Jun 26, 2008
... all adding up to revenue gains and maximum Return On Investment (ROI). To learn more about RevenueGateway and their affiliate offers, visit www. ...

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Generate More Sales in ANY Affiliate Program ? Part Three