by: Elena Fawkner

"Where is all the help I'm supposed to get. I have been buying ezine
and classified ad builders and signing up for Echecks and Virtual
credit cards. In the meantime I have no business and no ads set up.
When does all this happen? Let's go here. I spent all day on this.
I'm running out of time."
I kid you not, this is the sum total of an actual email that hit my
inbox this week. Not only did I not know this person from Adam, this
was the first and only email I had ever received from her and to
this day, I have no idea what she's talking about. Presumably, she
signed up for one of the affiliate programs I promote from my site
and was asking, in her own inimitable style, for my help. Although I
am always ready and willing to help anyone I can, this is most
definitely NOT the way to go about asking for it. Needless to say, I
let her know what I thought of her approach in NO uncertain terms.
The attitude displayed in this person's email to me (and she is by
no means an isolated example) exemplifies why so many people fail to
make a success of their online businesses. Leaving aside the utter
rudeness of the approach, notice the impatience, the expectation to
be up and running in a day, the HURRY, the apparent belief that real
world principles such as courtesy and good manners don't apply
online (they do). Think this person is going to last the distance?
What kinds of tactics do you think she is capable of resorting to in
pursuit of the almighty dollar?
So, let's take a realistic look at affiliate programs, what they can
and can't do for your business and how to maximize your chances of
creating a successful, long-term business with them.
WHAT IS AN AFFILIATE PROGRAM?
An affiliate program (also known as a reseller, associate, referral
or partnership program) is essentially a revenue-sharing arrangement
whereby you, the affiliate, receive payment from the owner of a
product or service that you promote on their behalf.
Affiliate programs are an excellent way for the new internet
entrepreneur to start an online business.
TYPES OF AFFILIATE PROGRAMS
There are various types of affiliate programs.
The most simple involves you, the affiliate, placing a banner ad,
graphic or text link at your site which is linked to the site of the
business you are promoting. This link is coded with your unique
affiliate ID so that the site visitor is recorded at the target site
as having originated from your site, thereby allowing you to be
credited with the sale.
Payment is generally a fixed percentage of the sale value
(commission) or "pay per click", where the affiliate is paid a
certain amount for every time a site visitor clicks on the link at
the affiliate's site, whether or not a sale is made.
The more sophisticated affiliate programs are multi-tier and allow
the affiliate to earn commissions not only on the traffic they
directly refer to the target site but also a proportion of sales
generated by their sub-affiliates.
BENEFITS OF AFFILIATE PROGRAMS
The greatest benefit of affiliate programs is that when you are just
starting out in your own online business you don't have to worry
about creating your own product or service. You just promote someone
else's and get a share of the revenue pie for your efforts.
You also don't have to concern yourself with warehousing, transport
or logistics headaches. All of this is handled by the business whose
products/services you are promoting. All you need concentrate on is
driving traffic to that business's website. This means that a high
proportion of your revenue is profit.
The owner of the product/service is also responsible for collecting
payment, customer service and the myriad other details that come up
on a day to day basis in running the business.
DISADVANTAGES OF AFFILIATE PROGRAMS
The main and obvious disadvantage of affiliate programs is that it
is the owner of the product/service who earns the lion's share of
the profit on the sale.
You're working on commission. You will NEVER earn by way of
affiliate program commissions as much as you can earn by way of
profits from producing and selling your own product/service.
As a result, affiliate programs represent a high opportunity cost
when you consider what you could earn if you instead channeled the
time and energy you spend on promoting affiliate programs into
creating and promoting your own product/service.
For this reason, it does not make sound business sense to rely
solely on affiliate program income for the longer term growth of
your business.
Instead, think of them as a way of dipping your toe in the water
when you're first getting started, and a nice little sideline once
you've created your own product/service. Do NOT build your business
around affiliate programs with the intention this will always be the
backbone of your business. You'll be stunting your own growth if you
do.
CHOOSING THE RIGHT AFFILIATE PROGRAMS FOR YOUR BUSINESS
So, keeping in mind what affiliate programs can and can't do for
your business, let's turn to what you should look for when choosing
an affiliate program or programs to promote in your business.
=> Synergistic Products/Services
First off, and this is a cardinal rule, only promote those programs
which will allow you to create synergies with your site. This means
selecting programs that naturally complement the subject matter of
your site and that will therefore be of interest and relevance to
your site visitors. This will ensure your prospects (ie your site
visitors) are pre-qualified which will result in a relatively higher
conversion ratio (the ratio of visitors to purchases) than would be
the case if your traffic is untargeted (which will be the case if
you promote unrelated products and services from your site.)
=> Quality In All Things
Keeping the need for synergy uppermost in mind, look for quality
programs first and foremost. The last thing you want to waste your
time, money and reputation on is a shoddy product or service. There
are just too many quality programs out there to settle for anything
less.
=< Stability of Company
Look for a company that's been around for a while and that's
reputable and stable (both financially and in its management). Any
reputable company will have full contact details readily available
so do your research.
=> References
Look for testimonials and references from other affiliates. If the
company you're interested is not forthcoming when it comes to
putting you in touch with other affiliates, move on.
=> Affiliate Agreement
Look for a professional, considered and detailed affiliate agreement
(contract). This shows that the company is serious about its
business.
Watch out for exclusivity clauses and other restraints. Some
affiliate agreements will require that you not promote competing
businesses' products and services. This is not to say you should
avoid such agreements. As a general rule, it is your interests not
to promote competing programs anyway. Just be aware of what the
agreement says on the subject to avoid getting yourself into hot
water.
Look also for an agreement that treats spammers harshly. This
protects not only the company but other affiliates as well. The last
thing you or any other reputable affiliate needs is to have your
reputation and the reputation of the product/service you are
promoting besmirched by these sorts of tactics.
=> High Commissions
Promoting someone else's affiliate program necessarily requires that
you divert traffic away from your site and towards someone else's.
Make sure you're properly compensated with a high commission
structure. And be sure to set up your link so that when the visitor
clicks on it, a new browser window is opened for the target site.
This at least keeps your site in front of the visitor so they can go
back to your site once they've finished at the site your link has
taken them to.
=> Lifetime Commissions
Look for affiliate programs that will credit you with not only THIS
sale but all other sales the customer may make in the future. Many
programs are set up so that the customer is identified as "yours" so
that when the customer returns to the target site in three months
time, the sale is recorded as having been generated by you.
=> Residual Commissions
Include programs that offer residual commissions in your portfolio.
Good examples are webhosting services, autoresponder services and
the like where customers sign up for a continuous service that
requires periodic, regular payments. You receive periodic, regular
commissions as a result.
=> Tracking of Commissions
Look for programs that allow you real-time access to your stats so
you can keep easy track of your commissions.
=> Reliability of Payment
When checking with affiliate references, find out what the
business's record is on paying out commissions. If they're slow or
there appears to be a pattern of problems, keep looking.
=> Frequency of Payment
Make a note of payment schedules too. Some programs pay weekly, some
monthly, some quarterly. Some only pay once you accumulate
commissions of a certain amount. None of these arrangements are
necessarily good or bad in and of themselves. Just be sure you know
what to expect.
=> Programs that Require Payment Up Front
Two words: MOVE ON!
=> Affiliate Support
Finally, take a look at what support the business offers its
affiliates to make sales. Do they provide resources such as sample
ads, banners, logos and the like? Do they provide useful advice
about maximizing your sales? A good affiliate program provides
affiliates with a LOT of support in these areas.
MAKING MONEY FROM AFFILIATE PROGRAMS
OK, now you know what to look for in an affiliate program. Here's
how to maximize your sales of those products and services and,
therefore, your commissions:
=> Get Your Own Website
No ifs, no buts. DON'T rely on the you-beaut self-replicated job the
company provides all its affiliates. Link to that site from your
main site.
=> Get Your Own Domain Name
This presents a much more professional image. Many people won't give
the time of day to a business that thinks so little of its prospects
that the owner won't shell out 70 bucks for a domain name. So mean
business and look like it.
=> Get Traffic To Your Site (Duh!)
As a rough guide, you will need at least 500 targeted unique
visitors a day to your site to make reasonable money from affiliate
programs.
=> You Must Have A Site That Will Attract Repeat Visitors
If your website is nothing more than a splash page consisting of
little else other than banners for umpteen different affiliate
programs, forget it. Your site must be worthy of your visitor's time
and interest before you can even begin to think about converting
that visitor into a paying customer. So create a real site with real
content that will keep them coming back for more.
=> Personal Testimonials
A personal testimonial will result in more sales than a mere link or
advertisement. So take the time and trouble to write a personal
endorsement of the product or service you are promoting. And, of
course, it goes without saying that in order to write a personal
endorsement, you must know that of which you speak. NEVER promote a
program you haven't first purchased yourself. If you don't think
enough of your program to invest in it, how do you expect to
persuade others to?
=> Promote With Your Sig File
Include a link to your site in the signature of every email you
send.
=> Promote In Your Own Ezine
Finally, if you're not already publishing your own ezine or
newsletter to stay in touch with your site visitors, start. It's a
great way to promote not only your site but also the affiliate
programs you promote from your site.
MAKING SERIOUS MONEY FROM AFFILIATE PROGRAMS
The only way of making SERIOUS money from affiliate programs is by
creating your own product or service and recruiting affiliates to
sell for YOU.
The affiliate program phenomenon is one of the Internet's true
success stories. It provides a toe-hold for the would-be internet
entrepreneur to begin a real, live business of his or her very own.
But the real beauty of affiliate programs lies not in what they can
do for you, as an affiliate, but what they can do for you, as a
recruiter of affiliates for your own program. By all means jump on
the bandwagon and start promoting other people's products to get
your start. But don't wait too long to start developing your own
product line. There is a ready-made salesforce numbering in the
millions ready and waiting to sell it for you.
About The Author

Elena Fawkner is editor of the award-winning A Home-Based Business
Online ... practical home business ideas, resources and strategies
for the work-from-home entrepreneur.

http://www.fawkner.com/subscribe.html