How Affiliate Marketing Works for Monetizing Web Sites
I’d like to say I get asked about affiliate marketing frequently from clients with decent traffic numbers. But, in truth, I don’t get asked anywhere near as much as I should, which tells me that not everyone knows about affiliate marketing, even though it’s fairly basic. Not to fear… I’ll explain it here. :-)
Before diving it, I want to make clear that affiliate marketing is not for everyone. After all, it’s a strategy that, like normal advertising, sends visitors away from your web site. So, if you’re big into ecommerce (e.g., a retailer with your own products), you may find it more profitable to focus on selling your own products rather than someone else’s.
That said, there are certainly tons of reasons to explore this type of marketing. Maybe you’re a blogger, for example. Or, maybe your site is meant as a forum / hub for a niche topic. Or maybe your site is an informational site setup specifically to garner eyeballs for advertising. Whatever the case, before we get into affiliate marketing, let’s take a quick look at the other big money-maker for web sites.
Chances are, if your site has decent traffic numbers, you probably at least have some basic advertising running, if only to make a few extra dollars for the effort. I don’t know many who get enough traffic to live off of advertising revenue. But, I know quite a few who have made hundreds or maybe thousands per month from it — sometimes much more during traffic spikes.
Advertising is relatively simple. At its core, there are two key points:
- The more ads you show, the more money you make. These are “impressions” and they’re not especially valuable.
- The more that visitors click on those ads, the more you make. These are click-throughs or conversions, and they’re significantly more valuable.
The problem is, it can be tough to feel as though you’re in much control over how many people are clicking on the ads. And, in truth, it’s kind of a bittersweet thing for a lot of site owners. After all, when someone clicks an ad, they leave your wonderful site. That’s generally not something to celebrate. On the other hand, you’re getting compensated for it, which usually makes up for any sense of loss felt.
The most common frustration with advertising, however, seems to be the often-disappointing revenues.
With affiliate marketing, it works a bit differently. For this, you can theoretically leverage your visitor demographics in ways Google simply can’t. This is because you should know your visitors better than anyone. As a result, you should know what they may genuinely respond to in terms of products and services.
Let’s say you run a blog about health and wellness. Maybe you’re into the paleo diet or something, for example. One thing you might do is to sign up with one of the larger affiliate marketing networks. Here are a few that I’ve had success with over the years:
- CJ Affiliate (aka Commission Junction)
- There are many others → here’s a good listing.
Once you’re signed up, you can browse deals available. Generally, all provide you with a means of searching out products or services represented. So, you (as a health care blogger) would search around for health-related products and services in each system.
Let’s say you decide that you’d like to advertise vitamins and supplements. When you search around in these directories, you’ll see not only product information, but a complete profile — who makes the product, what commission structure applies for any sales or traffic you send their way, whether cookies will track shoppers during their visit and/or during future visits, etc.
For example, let’s say you really want to sell Vitamin C, and a company called XYZ Supplements is an affiliate advertiser in one of those big marketplaces. Let’s say they have a policy where any traffic sent to them from your site qualifies for a 15% commission on gross sales. Not bad — a$100 order gets you $15, right? So, you sign up for that one.
Another example might be a much more lucrative offer. Maybe you come across some personal trainer in there who sells a complete paleo diet program that costs $400, and the person is willing to give you $200 for each person who buys it via a link from your site. Hmmm… that’s certainly worth taking a look at.
I should note that you definitely want to research each opportunity you find. Naturally, you want to make sure the person or company is reputable. But, there really are some fantastic deals out there. Sometimes they’re a little mind-blowing — things like 90% commissions, for example. And, while that may sound unrealistic and/or fraudulent, keep in mind that some people sell products or services for other reasons than to make direct money on that sale.
Here’s an example: Let’s say you see a deal in there from some guy named Joe Paleo. Joe has a diet eBook that costs $99, and he’s willing to pay you (the affiliate), $95 for each one you sell. What might his motivation be for that? Well, for one, it could be that he has many other more lucrative things or services to sell, and that $95 is basically a loss-leader. In that case, it’s a win-win because you get a high commission and he gets a new customer. New customer acquisition, after all, is hugely valuable.
At any rate, you can usually browse the affiliate marketplaces linked to above not only by product category, but also by commission rate, dollar value (if flat commission) and more. So, take a look around and try to strike a balance between what you think would resonate with your readers and what would make you happy in terms of income.
Once you’re all signed up and have selected the products you want to be an affiliate for, you have two critical steps left. First, you need to get your unique links. These are the URLs you point to their sites, whether via text links, graphical ads on your sidebar, or whatever. Savvy affiliates often provide you with banner ads you can use, text links, sidebar ads, text/copy and other tools to help you sell to your audience.
Once you have your links / graphics / text, the final step is to place it on your site. Give it a try, and feel free to get creative. You may well want to make up your own ads for these things, placing them on your site and linking out to your affiliate links.
If you run a large site powered by a CMS like Joomla or Wordpress, there are additional affiliate marketing tools or possibilities out there. For example, I had a Wordpress site once that had about 900 posts. I knew the site mentioned chocolate quite frequently, so I thought it would be neat to link each word “chocolate” to an affiliate store where chocolate was sold. Sure enough, there was a great plugin available to manage this in an elegant manner. (See here for a list of Wordpress plugins and here for some Joomla extensions to do this. For the Joomla link, you would then search under Affiliate Systems.)
Other Notes About Affiliate Marketing
If you don’t see a company you’d like to represent in one of the major affiliate marketplaces, such as the ones listed above, it’s often worthwhile to take a look at the web site of the company you’d like to sell for. Many companies don’t offer products via large affiliate companies like the ones I mentioned. Instead, they may use another company, or may even have their own internal system.
Second, keep in mind that YOU may also want to make money be being on the other side of this equation — that is, by offering a product or service for sale and building a group of affiliates to go out and market it for you. Let me tell you, it’s a fun and profitable thing, if you have the right product or service. The first time I tried this, we had put together an ebook about how to make edible arrangements out of vegetables. Obviously, we didn’t get rich from the effort, but for a while there it was pretty neat to get checks in the mail each month for basically doing nothing (aside from the initial work of writing and producing the ebook).
I also wanted to mention one of the more famous, early-adopters of affiliate marketing. Amazon.com actually has a program called Amazon Associates, which you can read about here. It’s … well, “okay” I guess. Personally, I never made great money from it. But, it’s a legit, huge program nevertheless. And there are plenty of articles online from bloggers and affiliate marketers offering advice on how to best profit from it.
I hope that covers the basics of affiliate marketing. Please let me know if you have questions — and good luck!
Jim Dee heads up Array Web Development, LLC in Portland, OR. He’s the editor of “Web Designer | Web Developer” magazine and a contributor to many online publications. You can reach him at: Jim [at] ArrayWebDevelopment.com. Photo atop piece is adapted from “Patchwork” by Kate Russell (Flickr, Creative Commons). Please 💚 this article if you liked it (by clicking the heart icon below), as it really helps.