Affiliate Marketing Is Invaluable To Learning The Arts And Smarts Of Knowledge Commerce
If you are a starter Knowledge Commerce marketer you may wonder if you have all the skills you need to market and sell your own products, after you have created your own ebooks, courses, membership sites or consulting services.
There is an ultra-smart way to begin your journey into full-scale Knowledge Commerce. Start with Affiliate Marketing and learn to market the info-products of others in Knowledge Commerce.
The skills you learn from Affiliate Marketing will cut out the bulk of the risks, time, and effort you’ll spend on launching your own knowledge products later. You can earn handsomely while you learn, too.
At Solohacks Academy, we see Affiliate Marketing as an earning avenue you can continue, even after launching your own products in Knowledge Commerce. You don’t have to stop this line of earning ever. In fact, your portfolio of products will only be richer and more varied if you sell a lot of affiliate products, that chime well with your own products, that you develop later on your own.
1. What Is Affiliate Marketing And How Does It Work?
Affiliate Marketing is among the most common ways most online entrepreneurs begin to make money with online businesses. Much before they launch their own products, they experiment by trying to sell other people’s products to online customers, to earn a commission. This preps them to later market their own products with confidence.
The Affiliate Marketing system is so well-oiled nowadays, that if you have the right products to sell from reputed marketers, and you have the right audiences, you can make a fairly reliable income from Affiliate Marketing. But let’s not get ahead of ourselves here. Let’s first see what Affiliate Marketing is and how it works …
a. What is Affiliate Marketing And How Do You Earn From It?
Quite simply, Affiliate Marketing is the process by which an “affiliate” (a subsidiary seller) earns a commission for marketing another person’s products or services. The affiliate picks products suited to his own expertise niche – so he knows his audiences and their tastes, and can convincingly recommend certain much-wanted products to his community.
As he promotes such products, he earns a percentage of the profit from each sale he helps complete.
The process goes like this: the job of the affiliate is to entice people to know more about the products he recommends by clicking links that lead from his own site to the product seller’s site. The seller knows (from the code attached to the link) which affiliate sent the customer to his site … and if the customer buys, the set percentage of commission is automatically assigned as payable to the affiliate who sent the customer.
To visually understand the process, just take a look at this sketch below …
Image courtesy: Entrepreneurship Facts
So what can go wrong, if indeed anything can go wrong? There are some things an affiliate has to be careful about:
- The affiliate should make sure the product seller is a well-known brand, with credibility and reliability in the matter of payments. The affiliate should not fall for offers of a high percentage of commission and agree to work with product sellers with a dubious reputation for paying their affiliates on time and correctly.
- The affiliate should make sure his unique affiliate code, which he uses on his links to direct customers to the seller’s site, do not get hacked or stolen by “affiliate commission thieves”. There are ways to protect oneself, and an affiliate should be well versed in the ways of thieves and the ways to keep them at bay.
- The affiliate should know what his rights are and how to get redressals if there is a dispute regarding commissions. Sometimes you can have a dispute about which affiliate brought a customer to the seller and is therefore due to get the commission. For example, if there has been a time-lapse between the time one affiliate recommended the product but the customer didn’t buy … and another affiliate landed the same customer later by making him buy this time around. perhaps both affiliates may think they are due to get the commission. The seller should have clear rules on how long time-lapses can be, when an affiliate still has a claim on the customer. The seller must also have good grievance redressal mechanisms, so disputes are neatly settled to the satisfaction of all.
If you’re planning to earn affiliate income, though, don’t let probable negatives make you balk. They are all par for the course. As long as the seller’s rules and intentions are clean, and up to the best of industry standards, you have nothing to fear. Most affiliates are extremely happy being affiliates and earning without the hassle of creating a product or servicing a customer. This is the business where all you do to earn handsomely is to sign-post the customer to the seller’s site with a strong recommendation.
b. There Are Many Ways To Earn Affiliate Commissions … Know What These Are
It’s not always necessary that affiliates can earn commissions only if a consumer they send to a seller ends up actually buying a product. There are many forms of affiliate commissions paid by sellers even if affiliates bring customers part of the way towards sales. Here are a few classic options that sellers may provide for affiliates to earn.
Pay per sale
This is the most lucrative affiliate earning structure. Here, the merchant pays the affiliate a declared percentage of the sale price of his products, if the consumer purchases the product as a result of the affiliate’s communication strategies. The affiliate must actually get the buyer to buy the product before he is paid by the seller.
Pay per lead
In this system, a seller pays an affiliate a set commission for just bringing a potential buyer – a lead – up to the seller’s site, whether or not a sale results from that lead. However, the lead has to be seen performing some desired action on the seller’s site, just short of actually buying. Perhaps the seller may say the lead should fill out a contact form, sign up for a product trial, subscribe to the seller’s newsletter, or choose to download some PDFs or freeware. The idea is that the lead must show some initial level of interest in the seller and his products, for the affiliate to earn his commission.
Pay per click
This is by far the easiest way to earn an affiliate commission. All the affiliate has to do is to incentivize the potential buyer to click the link on his site and reach the seller’s site. For that, he gets a commission because he has reached a potential buyer to the seller’s front door. The affiliate is paid, in essence, for increasing traffic to the seller’s site.
Tiered affiliate earning system
This is a bit more complex as an affiliate program. The seller may allow his existing affiliates a commission for bringing in more affiliates into his affiliate program. Just like multi-layer marketing, the first affiliate is considered to be on the top-tier of the system, while other affiliates he brings to the program are said to be second-tier affiliates. Now, we already know that every time the top-tier affiliate helps the seller make a sale, he would, of course, earn his commission. But in a tiered system, if his second-tier affiliates help the seller make a sale, the top tier affiliate would also earn a percentage from their sales also. Thus any affiliate who brings in a network of other affiliates earns from his own work as well as from the work of other affiliates he introduced into the system. There are sellers who encourage several tiers of affiliates.
c. How Much Can An Affiliate Really Earn?
Here are some examples to whet your appetite:
- Jason Stone, the affiliate marketer, also known as Millionaire Mentor, was responsible for as much as $ 7 million in retailer sales just in two calendar months.
- Ryan Robinson, an affiliate marketer, reported over $ 19,000 in affiliate revenue in a month.
- An affiliate website — The Wirecutter — earned an estimated $ 10 million in revenue annually, and was eventually sold to the New York Times for $ 30 million.
- Pat Flynn from Smart Passive Income makes well over $ 100,000 in affiliate commissions per month.
In fact, Pat Flynn publishes an income report every month, and I’ve taken a sample report from one of his earlier years to show you how he chooses his best products for affiliate marketing and how much he makes approximately from his collection.
Image courtesy: Smart Passive Income
FinchSells.com have an interesting blog post. They ran a poll to see all the different earning brackets of affiliates and how much each bracket earns on average. Here are some interesting facts from their article. (Note: all these numbers below are their PROFITS, not just revenues.)
- Low Level Affiliate – Anywhere from $ 0/day up to $ 300/day.
- Intermediate Affiliate – Anywhere from $ 300/day up to $ 3,000/day.
- High Level Affiliate – Anything above $ 3,000/day.
Below is a chart of their poll results to show you how different affiliate income earners stack up typically.
Image courtesy: Finchsells.com
2. Three Strategic Skillsets You’ll Master As An Affiliate (… Handy In Building Your Knowledge Commerce Business Later)
Building the right platform for yourself, from where you can propagate your Affiliate Marketing, is the first step to creating your business foundation. You need a good strategy for your Affiliate Marketing, the knowledge of how to use and analyze data to improve your performance day after day, and the ability to build your own website in a jiffy, without it costing you an arm and a leg.
All of these three skillsets will be invaluable for beefing up your own full-blown Knowledge Commerce business later, so get your teeth into these …
a. Planning Your Marketing Strategy
In the beginning, go with one or two reputed products with very structured affiliate programs and good reputations. Don’t rush to sell as many products as you can. Learn the ropes not by bookish learning but by actual practice.
Plan the methods of marketing you’ll use for promoting these products. Will you use your own blog? Will you use niche forums where you’ll make subtle recommendations? Will you feature write-ups in major review sites or magazines with a good following? How will you use social media? Will you even try to do a webinar on the product and its benefits and usage?
All sellers give affiliates a dashboard view of their earnings. If you look at your affiliate dashboard and your site performance you’ll start seeing patterns in the data that give you insights on how well you really are doing as an affiliate, and you’ll know clearly which methods of marketing strategy are giving you better results.
Your strategy going forward should then be structured based on the data readings. This is a whole different way of doing business than “going by intuition” or “winging your way”. Slowly add products to your affiliate repertoire, and make sure you have the bandwidth for really recommending them well via your blog posts, product reviews, and so on. Again track your performance.
If you learn to follow this discipline in affiliate marketing, it can be invaluable when you do full-blown Knowledge Commerce later.
The datasets in affiliate marketing are much smaller and simpler, and a good starting place to experiment with “data-driven strategy”.
You’ll get some decisions right and some wrong, but there’s far less risk in affiliate marketing than in selling your own products. So go ahead and learn to use analytical insights to tweak and test your marketing strategy.
b. Learning How To Analyze Data
Data analytics is another overwhelming-sounding area that affiliate marketing trains you into. As an affiliate marketer, there are three things you need data for.
One, you need a single place where all your various affiliate programs data can be seen as a dashboard. This is the basic need for any kind of data analytics – a single place where all data pours in. You may start with a product or two that you are an affiliate for, but eventually, the more products you add to your marketable collection, the more earning potential you have.
For affiliate programs, you have great tools like Affjet. This is a dashboard that shows you all the affiliate programs you’ve enrolled in and what you’ve earned so far from each, and when the next payments are due.
Not only should you read data to track earnings, but you need to start relying on data (instead of hunches) on what types of customers you are attracting, when they are visiting your site, and if certain types of content work better than other types.
If you have a self-hosted blog, it can be tracked via Google Analytics (using a plugin called Monster Insights) to see how it is performing on various reader-engagement parameters. A simpler tool I use is a plugin called Hitsteps which tells me who came to my site, what they clicked on, what journey they took through my site, and so on.
If you’re blogging on Medium, traffic and visitor statistics are available for articles you publish there. All statistics in Medium are visualized as charts and graphs, and are therefore easy to understand, even if you a newbie to data analytics.
c. Building Your Own Affiliate Website
A lot of people getting into affiliate marketing wonder what sort of web design they need. They balk at the idea of having to design a website.
Here’s one truth. Website design has become so simple that you could give a child half a day and have a website ready to go. There are so many templates and themes available online. Simply tweak them around a bit and have something that looks professional.
In fact, did you know there are special website theme templates ready-built for affiliate sites? Here are some of the best … ReHub, SteadyIncome, Splash, MoneyFlow, Expert, Goliath …
My favorite, though, is Goliath. It has an in-built review system that lets you professionally review the products you promote.
If you use of one of these ready-built themes, you’ll learn the rigour involved in affiliate marketing … because these themes have all the typical features a good affiliate marketer needs to communicate in his product-promotion articles.
3. Three Marketing Skillsets You’ll Acquire As An Affiliate (… Handy In Selling Your Knowledge Commerce Products Later)
There are three successive skills to the art of selling anything online. One is blogging when you get people to sit up and take notice of what you say and give your words some respect and a following. The second is marketing, when you are able to take your potential customers a little further up the path towards a purchase that earns you money. And finally there’s selling, which is the art of tipping people over the threshold of hesitation into confident buying.
Here’s what you Affiliate Marketing can teach you about all these three skills, so you get into mastery grade before you launch your own knowledge commerce products.