Key Benefits and Pitfalls of Affiliate Marketing for Online Businesses

Affiliate marketing has been around for some time now due to its simplicity as a business model, and its potential for generating considerable amounts of income for the two parties involved – retailer and marketer.

The model is straightforward. A retail organization creates affiliate programs, which are basically hyperlinks to its products, which are offered to marketers or small businesses/sole-traders. The latter places these links in their web platform, and then proceeds to promote these items, on the understanding they’ll receive a commission every time a customer clicks through to make a purchase.

So, for anyone considering getting into affiliate marketing for their online business, what are the key benefits and pitfalls?

Benefits

Simplicity

Perhaps the simplest aspect of this business model is the fact all that is required is a competent web presence and a sound knowledge of the product. The most perceptive marketing campaigns can be built around subjects the marketer is already familiar with. The most successful affiliate programs are not about plugging the hyperlinks themselves, but encouraging customers to alight on the relevant pages by providing them with engaging content about the subjects. The added bonus in all this is that the majority of these programs are free to sign up for.

Flexibility

Because the products lie at the heart of any marketing campaign, the marketer has a degree of flexibility in deciding which ones to actually promote. You can decide to go for proven bestsellers, although there is always the danger this particular marketplace will be fiercely competitive. But, as mentioned, another ideal scenario would be to choose products to promote which you are competent in writing about. Marketers can always chop and change the programs they have signed up for, depending on how successful they have been.

Ready-made customers

If you are already running a website which is attracting a good rate of traffic, then it is up to you how well you engage with these site visitors in order to transform them into potential customers. But if you collaborate with networks such as TopOffers.com, you will gain insight into affiliate programs you can latch onto where you won’t be required to go out of your way to attract any more customers. Many retail organizations offering programs already have large customer bases which you will merely be tapping into.

You always have the option of signing up for multiple affiliate programs. Once you get the hang of these operations, you can begin to spin several different plates at the same time. Ideally, you should be able to set a program in motion and then let it run its course, keeping hands-on management responsibilities to a minimum.

Pitfalls

You’re at the mercy of the retailer.

Exactly how much money you are able to make from your affiliate programs is entirely dependent on the retail organization itself. The commission rates will vary, and if they decide to cease manufacturing a particular product or stop incorporating it into programs, there is nothing you can do about it.

Sporadic income

Very few programs can guarantee a regular income. It is far more likely that the market will fluctuate tremendously. In some months you can make a decent turnover in terms of commission, while there may well be many less fertile periods where the sales rates dip.

E-fraud

Because affiliate programs are reliant on web traffic, you always have to be wary of people with ulterior motives. There have been instances when large retail organizations have fallen foul of the so-called ‘cookie stuffers’ – fraudsters who write software programs pertaining to drive customers to purchase peaches which are little more than glorified cookies.

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