Starting an Online Affiliate Program – Read this First!

Posted on December 21, 2012 by Sophie Evans

If you are tired of the traditional 9 to 5 position, which comes with a long commute, endless impromptu business meetings, and no flexibility, then you might consider a career change…as many people already have, and continue to do.

One of the possibilities is starting an online affiliate program. It not only gives you the flexibility of working from home and enjoying the freedom of working the hours you want, but it’s also a great opportunity to create your niche and livelihood.

Working from home, with an online business has become very popular…for a reason. Many people are now enjoying the fact that they can attend their children’s school events, make doctor’s appointments when they want, and work from the local coffee house for a change of scenery.

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An Informative ‘Cup of Joe’

If you are thinking of starting an affiliate marketing career, then you should listen to the Coffee Talk podcast that I just did. It was very informative, filled with great information for those considering an affiliate marketing career… from some of the field’s leading experts.

James Martell hosts these podcasts, and today’s special guests were two more leaders of the industry, with as much experience and time invested in the field as James. Sarah Bundy and Carolyn Kmet were enthusiastic to share their knowledge, and sat down with James to chat.

Sarah has done quite well in the market and is founder and CEO of All Inclusive Marketing (AIM), and has over a decade of experience and knowledge to share with others. Carolyn has equally as much time and experience in the field and currently sits as Vice President of Performance Marketing at AIM, alongside Sarah.

You can imagine how much information this particular episode provided, and here are some of the highlights that piqued my interest:

The Foundation of Affiliate Marketing

If you aren’t too familiar with online affiliate marketing, the concept is fairly simple. It’s where you have more than one person working on making a sale of a product or service, but are not under the same roof…or business.

The first person will have a product or service they are selling through their website. Sometimes they have multiple items to sell, but the concept remains the same regardless. This person is responsible for ordering, warehousing, and shipping the products to the consumer after a purchase is made. A person in this role of affiliate marketing is known as the merchant.

You might be thinking that this sounds like a normal business. And, you would be right, if that was it. But, a second person enters the picture with affiliate marketing…known as the affiliate. The affiliate also has a website, but no actual merchandise. They promote the merchant’s product(s) by placing a link on their website for the product, which directs the consumer to the merchant’s website. Once they make a purchase through that link, the merchant pays the affiliate a commission.

Let me paint a more specific picture for you…

The merchant (we will call him Joe) is selling bank checks, registers, and other financial items on his website. The affiliate (we will call her Sally) places a link on her website, which her visitors can click on if they are interested in ordering checks online. When the visitor clicks on that link, they will be directed to Joe’s website to view what he has to offer. If the consumer makes a purchase, Joe pays Sally a commission for the sale.

Keep in mind; it wouldn’t make sense to have a link for ordering checks on a site about fishing. Unless you promote checks with a fish design, that is. However, the point is to have your website and the product you are promoting relate somehow.


The Recommended First 3 Steps

When listening to the Coffee Talk podcast, James, Sarah, and Carolyn all agreed to what the first 3 steps should be when starting an affiliate program. Take a look:

  • Create an Affiliate Marketing Strategy – Just as you would for any other business, make a plan before you ever start. A little research on all the players typically involved, available affiliate groups to assist, and what your competitors are doing will help you come up with your own plan.
  • Website Development – Create a quality website that is relative to the products you want to promote. Fill it with informative and valuable information, eye catching photos, and a way to communicate with the consumer (a good way to know what they are looking for).
  • Banner Ads – Develop quality and attention-grabbing banner ads to catch your visitor’s attention. This is where they will initially notice the product, which you can earn a commission on if they click on it to make a purchase.

These are all important steps when starting out as an affiliate. So, make sure to put some time and effort into each area.

Budget for the Cost

Of course, there is always a budget that each new business should be concerned with, including affiliate marketing. Even though you will be saving a lot of money by working from home and not having a lot in overhead costs, you will need some funds.

If you work with an affiliate management company, you can expect to pay out $30,000 up to $90,000 per year. This will depend on which company you choose. You could save some money by doing it yourself, or have in-house management. But, if you don’t have the experience that a management company has, it will show in your growth.

Also, you will have a launch fee with an affiliate network, which typically costs between $650 and $5,000, again…depending on which company you choose. An affiliate network is basically a 3rd party who will track all your transactions to help keep them organized.

Hopefully I have shared enough information to pique your interest in affiliate marketing, so you can pursue a dream of working from home and having the freedom and flexibility so many are already enjoying.

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About Sophie Evans

Sophie Evans is a freelance writer who enjoys working from home and the freedom it allows. She often writes on topics inspired by websites she visits, or experiences in her own life. For example, she was just recently looking at checks on when she decided to write her next series on personal finances. Sophie lives in Balboa Beach, California with her husband Rick and their 2 children. She admits to being addicted to Disneyland and Starbucks.

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