When To Use Affiliate Programs

If you are considering participating in an affiliate program you are looking at it from one of two sides, either as a merchant or a publisher.

Publishers should use an affiliate program when they have low traffic of high quality. Since advertising revenue is usually based on impressions, its hard to charge an advertiser money if they only get 10 impressions or page views. But if you can convert half of those impressions to sales, you can make 10% of whatever they sell. If someone buys jewelry or a watch, you could see a sale well over $1000.00 and netting you over $100.00 in profit.

You could never charge the merchant $100 for placing an ad on your very low traffic website. But it is very easy to make money using an affiliate program. The merchant does not have to pay you up front. Anyone in business likes that idea and knows it is a good one.

If you sell handmade jewelry and you advertise a commercial store, you would not likely cut into your own sales, since the products are so different. But you can advertise anything, not just similar products.

If a publisher has millions of page views, they they likely sell advertising space. If they can get more using affiliate programs, then they will fill the advertising with performance based programs.

The web gives you unique opportunities because you can track where people are coming from. Unlike radio or TV advertising that you really don't have a clue how much it does for you. This makes selling one item at a time possible and making money on every conversion.

We suggest using one of the main affiliate syndicates such as Commission Junction. One of the big reasons is that they are trusted and will pay you your money. If you sign up on some cheap unprofessional website, don't be surprised if they never pay you. Commission Junction gets the money from the merchant up front so you are guaranteed to get paid.

On the opposite side of the fence, you have the merchants. And again, we recommend using a Company such as Commission Junction to handle your program. The take a small percentage about 2%. But they provide thousands of publishers looking to advertise your product.

If you set up your own program, it will be hard to get people to trust you and even harder to market your program to publishers. You will have to manage the program, support the publishers, pay commissions every month and do a whole bunch of work.

Instead, you could use those resources to sell your product. Let the webmasters worry about web traffic and the professionals run your program.

Performance based commissions are good for any merchant that has enough padding in the price to pay it. Many retailers have cut prices so low, they just can not pay anything.

It is often necessary to build a knockoff site with slightly higher prices and disassociated from your regular website. Sort of an outlet store.

The bottom line is, if you can make money from the program, use it.