Guest Post by Peter Lawlor
I couldn't believe it when I learned about affiliate marketing. Think about it. You get paid to promote products and you don't have to deal with customer service, refunds, technical support, shipping and all the rest of it.
You simply drive referrals and earn an income.
When I discovered affiliate marketing, I got excited, to say the least.
My introduction to promoting digital products was e-books. In time, I discovered that there are much more than e-books to promote as an affiliate. Once I realized that this affiliate marketing gig presents opportunities to promote and sell pretty much every kind of product, I became dizzy about the potential of this business model...
Don't get me wrong, E-books and other digital products can be great earners. But there is much, much more out there you can promote as an affiliate.
The following are 5 types of products you can promote as an affiliate, and the pros and cons of each.
1. Digital Products
Many affiliate marketers get started by promoting digital products such as E-books, video courses, etc. Some sell very well and the commissions can be excellent.
Pros
- The only place to buy the product is online which increases the chance you'll gain the commission.
- High commission percent resulting in robust commissions.
- Many digital product vendors include upsells which can result in more commissions.
- Some digital product vendors offer lifetime commissions which means your referrals can generate commissions for you for years.
- Huge diversity of products to choose from.
- Often long cookie tracking duration; in some cases lifetime cookie tracking.
Cons
- High level of affiliate competition for popular digital products.
- Affiliate commission leakage in the internet marketing niches if sold on ClickBank. The problem here is that referrals buy through their own affiliate link so you don't earn the commission. Frankly, I'm of the view that ClickBank should prohibit affiliates from buying through their own links. This is a very common complaint.
- Lower conversion rates (generally).
2. Physical Products
I like promoting physical products because they sell well, especially recognized brands or from recognized online retailers such as Amazon. Sure, the commissions are a lower percentage than digital products and services, but this is offset by higher conversion rates.
Pros
- Excellent conversion rate for many physical products (relative to digital products).
- If you send a referral to a large online retailer, the referral may buy more than just the physical product you promote.
- Easy keyword research opportunities simply by targeting a product's name.
- Huge variety of products to choose from.
Cons
- High level of affiliate competition in many product-lines.
- May lose the sale by customer buying it offline.
- Lower commissions.
- Orders may be taken by telephone which may result in a lost commission.
- Some vendors' and online retailers have very short cookie tracking duration.
Tip: Provide affiliate links to several online buying sources. For example, if a product is sold on the vendor's website and Amazon, provide links to both.
3. Services
Services are under-promoted in my view which means they are a terrific opportunity for affiliate marketers.
As the internet grows in popularity worldwide, more and more businesses are offering web-based services. The savvy service providers have affiliate programs to promote their services.
Examples of web-based services include SEO services and online legal services.
Pros
- Decent conversion rate.
- Relatively low affiliate competition (compared to digital and physical products).
- Decent commission percentage.
- In some cases, you can find services offering lifetime commissions and/or recurring commissions.
- Often can only buy online which means customers can't go to a physical location which increases the chance you earn the commission.
Cons
- May lose sales if orders are processed by telephone.
- Some consumers may not quite trust online services which can hurt conversion rates.
- Not the variety to choose from that you have with digital and physical products. You have to hunt around a little to find decent web-based services to promote.
4. Membership Websites
Membership Websites can be an excellent product to promote as an affiliate because many membership websites offer recurring commissions.
Pros
- Potential for recurring commissions.
- Can't buy offline.
- Generally few in a particular niche so a referral has little choice and it improves the chance they will join if they're set on joining a particular membership website.
- If a membership site offers lifetime commissions on other products sold to members, you can earn for years from a single referral.
Cons
- Lower conversion rate (generally) due to people not wishing to commit to a monthly expense.
- The intangible nature of a membership site can also result in lower commissions.
5. Software with Recurring Subscriptions
I place software separately from digital products because software with recurring subscriptions often means recurring commissions for affiliates. Recurring commissions are one of my favorite commission types because they truly generate passive income.
Pros
- Free trial offers can help conversions.
- Some software vendors offer commissions for leads (i.e. free trial offers).
- Decent conversion rate.
- Potential for recurring commissions.
Con
- Some software applications have extremely high competition among affiliates. For example, e-mail software is extremely competitive.
Can you promote different types of products on a single website?
Absolutely. I do. As long as the different types of products are related, then there's no reason not to promote any or all the above different types of products on a single website.
The key is you never really know what will sell the best on your site. Don't get upset if you promote a dud. Affiliate marketing is largely a numbers game. When you hit upon a hot product, you can generate an excellent income. Add to that several products, and you can quickly establish a healthy monthly income.
One way to effectively promote all types of products as an affiliate is by writing reviews or building review websites.
About the Guest Author: Peter Lawlor is a contributing author to the free Definitive Guide to Affiliate Review Websites and the blog B2Web.
About Lynn Terry
Promoting affiliate products is a good way to make good income online. I generally prefer physical products because most of the products have limited competition. However, this is only true for fairly popular products. I think I will give digital products and the rest a shot soon.
Thanks so much for your comment Chris.
Physical products are great to promote as an affiliate, but suspect many niches offer opportunities to include digital product promotions.
For example, if you're in a niche promoting power tools, there are "how to" Ebooks and likely video tutorial courses on how to build various items.
These digital products would be a nice fit, and at the very least a decent e-mail subscriber promotion you can send to readers.
I think the best thing is a digital product. True it may be highly competitive, but isn't everything that makes a lot of money? You can't do anything without hard work.
Thanks a lot for your comment Usman. One nice thing about physical products is if the vendor has frequent sales that are exclusive for affiliate to offer, you can create some great "sales, coupons and deals" pages for physical products. This is fantastic for big-ticket physical items.
Also, many niches offer opportunities to promote both digital and physical products. Might as well promote as much as you can and give excellent info to readers on quality products.
With respect to competition, there are ways to find lower-competition affiliate arrangements where you are the only affiliate. Many companies don't have a formal affiliate program, but if you have a site in a niche that fits with them, you can create a referral arrangement and you'll be the only affiliate. I've set this up with 3 companies so far and it's terrific. There's some legwork involved, but it can be a great deal.
Hi Peter, can you share how the 3 exclusive affiliate was done? I mean, what was the process like?How would you know that those sales which goes to them are from your marketing campaign?
Great information! Very useful fro those people who want to try out affiliate marketing
Thanks a lot for your kind words Chad.
Lynn,
Like yourself, I monetize my operations in a variety of ways. Oddly enough, some types do great some months (relatively speaking) and others don't everything kinda jumps around, but on the average the monthly sum total is about the same...hopefully with a slight month over month increase...;)
Mark
Hi Mark, yes, affiliate marketing is certainly a numbers game with its ups and downs. As long as the revenue trend is upwards all is good.
You make a good point about some products doing better some months. There's no doubt that some products have a seasonal element to them. If you spot seasonal trends, it's an opportunity to target more keywords such as specific holiday sales or season sales.
I for one am very happy that Clickbank will let you buy through your own link, I don`t think it`s a big deal.
First of all, that only concerns the IM market. For all other markets - buyers have NO clue and don`t even have a Clickbank account. Even for those in internet marketing, they have to KNOW and REMEMBER that they can do that. I would bet it's very few.
And sometimes buying the product is the only way (for a digital product) to know what`s actually in there. I am an affiliate, it's normal that I get a rebate.
Hi Masque,
Yes, ClickBank permitting affiliates buying through their own link certainly mostly affects only the IM market. And yes, it's nice that an affiliate can get a discount to encourage buying the product and checking it out.
I do promote some ClickBank products outside and in the IM market, but tend to avoid the IM market products on ClickBank simply because of lost sales. Perhaps offering incentives to buy through an one's affiliate link is a solution. I don't go this route because I don't have any admin support to deal with sending out the incentive offers. Maybe one day. Thanks for your comment.
Great list of the various ways to monetize. I have always felt it is important to mix up your sources of income. When you rely too much on just a single form of income or monetization it is sort of like asking for trouble, if something goes south on that one way of earning income you are suddenly out in the cold.
So some great info.
-Steve
Thanks a lot for your comment Steve. Diversification is never a bad thing. Sometimes a product's vendor will end an affiliate program (it's rare, but it can happen). If you only promote that one product, you're left with nothing.
If that happens, you can usually plug in a different product in the promotional spots.
Yes I'm also glade you can buy through your own link on clickbank, I dislike promoting a product that you find has no value.
I also like prmoting something everyone can get a benefit from like Big Crumbs, where you get a rebate on eveything you buy on the interenet. I find myself buying more and more online.
Good tip on the Big Crumbs. I never heard of it. Thanks for sharing and thanks a lot for your comment.
in what category would fit wordpress themes? digital products or services? Anyway, I think this wordpress themes market goes very well, because there are a lot of premium themes that are very cheap and you can get even nice packages at huge discounts, like from elegant themes... I think there's some good money to be made from this wordpress themes affiliate
Hi Chris,
I place WordPress themes and other templates in the digital product category. A service would be something where a business provides a service for a customer beyond providing a digital download. That said, part of most themes' license is access to a forum, which arguably is a service.
Obviously there aren't always clear cut distinctions.
I'm really into the digital products, and I'm sure wordpress falls into the digital product category. Digital products are really easy to distribute, something I'm trying to promote more and more of.
Hi BCIT,
I agree with you that digital products are easy to distribute and althought conversions are usually lower, there is only one place to buy them and generally telephone orders aren't an option.
I totally agree with you about the buying of other affiliate marketers using their own links. We can't really blame them because they can really avail the discount for their own benefit. Even non-marketers already noticed this strategy. Maybe it could be a better idea if clickbank will make the affiliate link much complicated just like the affiliate link provided by amazon. At least editing the affiliate id would be far more difficult than what they used to have.
In comparison with Adsense, I have a much better income from affiliates.
Personally I prefer digital products.Conversion rates and profits are very good when you are selling a digital product targetting a narrow niche.