Is affiliate marketing a myth? Is affiliate marketing a scam? What is affiliate marketing?
Is affiliate marketing a myth? Is it true that you can make money from a website? Is it possible for a company to get advertising without having to pay for it unless it results in a sale? That sounds almost too good to be true. In other words, is affiliate marketing a myth?
I heard that question yesterday. No, affiliate marketing is NOT a myth. At first, I thought it was a really funny question. I found the question amusing because affiliate marketing programs are EXTREMELY common. They are one way that companies attempt to attract potential customers to their online stores and websites. For example, Amazon, Walmart and eBay all attempt to attract new customers to their websites using affiliate marketing programs.
What Is Affiliate Marketing?
Basically, affiliate marketing programs are another form of advertising. Everyday most of us are surrounded by various forms of advertising or marketing. Advertisements are on TV and the radio. Newspapers, magazines and newsletters are filled with advertisements. There are advertisements on billboards along the side of the road. Marketing efforts can be a bit more subtle. Company’s sponsor football stadiums, 5K races and Little League teams. They promote that their charitable giving and efforts. They put their names on pens, refrigerator magnets, notepads and baseball caps.
And then there is the world of advertising online on the internet. A customer can not walk down the internet highway and see all of their choices. There are too many choices. So, companies have to find ways to be found online when the customer is ready to make a purchase. Some companies pay outright for advertisements that show up on websites. Other companies encourage people to share positive stories and experiences about their company on social media or on their websites.
Affiliate marketing is another option, or tool, that a company can used to be found on the internet. Participation is an affiliate marketing program is way for a company to encourage people to refer their readers to the company’s website. The best part of an affiliate marketing arrangement is that the company does not have to pay for the advertising unless the visit results in a sale. Most other forms of advertising require upfront payment for the advertising services regardless whether any sales were generated.
From a Consumer’s Standpoint
From a consumer’s standpoint, the purchase price is the same regardless of whether the person came to the online store directly or if he/she was referred to the site by an affiliate. For example, if I want to purchase a book on Amazon. That book will cost the same regardless whether I stumbled across the book on Amazon’s site or if I first read about the book on Ollies Online Great Book Review site and then was directed to the Amazon’s sales page for that book?
Even though I thought the question was funny, my analytical side kicked in. “Is affiliate marketing a myth?” The other version is, “Is affiliate marketing a scam?” These are actually great questions for someone to ask. Below I want to dispel the myths surrounding affiliate marketing. In doing so, I will explain what affiliate marketing is and what it is NOT. I will also share a review of my experience as a member of the Wealthy Affiliate training and website hosting program. (I have been a Wealthy Affiliate member for 12 months and have been applying what I have learned from them to several of my business activities. )
Why the question, “Is Affiliate Marketing a Myth or a Scam” is a great question to be asking.
When affiliate marketing is discussed on the internet, it is typically in the context of “Make Money Online Marketing!”, “Make Money with Your Blog!”, or “Make Money with Your Website.” Owners of online stores may hope that participating in an affiliate marketing program is the “magic pill” that will bring droves of new customers to their online stores while not paying anything unless a website visitor buys something. Most of us are trained to be extremely skeptical of “get-rich-quick schemes” and other promises that allow us to make “easy” money while doing something we enjoy.
There is No Such Thing As Get Rich Quick, Just as Rome was not Built in a Day
Successful Affiliate Marketing Requires Knowledge, Work and Time
However, unless a person loves to waste money, we all need to extremely careful when we purchase training or buy into programs that promise to help us make money. Some programs over promise and under deliver.
Aside from getting an inheritance or maybe winning the lottery, there is NO such thing as a way to get-rich-quick. Even the founders of Amazon, Walmart, Microsoft and Apple did not get rich overnight. Even though each of those companies’ founders had brilliant ideas, they did not get rich overnight or even within 30 days. You won’t either.
Putting money into savings accounts and making smart, prudent long term investments in stocks and bonds will allow you to earn some money while you sleep. However, most other forms of making money are not easy unless you are doing it because you love doing it. So, asking if affiliate marketing is a scam or a myth is a great question that should be part of everyone’s process into deciding whether affiliate marketing is an activity they want to do.
CAUTION: If you are a beginner that does not already have a huge, actively engaged following on your blog or website, do not expect affiliate marketing to replace your full time source of income anytime soon.
People new to affiliate marketing should consider it as a “Side Hustle” or a potential source of part-time income that comes from simply talking about something they love.
If you are starting a website that can be used for affiliate marketing, it takes time to create a website that will develop a large enough following to create a sustainable income that you could live off of.
That said, people build successful affiliate marketing websites all the time. It just doesn’t happen overnight. An affiliate marketing business is like any other business. New businesses take time to grow and to become profitable.
On average, how long will it take a new affiliate marketing business to become profitable?
A common question for people that are interested in affiliate marketing is, “How long before I make money?” Well, it depends. There are too many factors for me to be able to give a definite answer. The same is true with brick and mortar businesses (in real life businesses).
9 Factors That Will Affect How Fast an Affiliate Marketing Business Can Become Profitable:
- Amount of demand for the product or service being marketed.
- How much knowledge and expertise the business owner already has about the product or service being sold.
- The size of affiliate marketer’s existing network that could be a source of potential buyers.
- The frequency that consumers purchase the product or service.
- Whether demand for the product or service is seasonal.
- Amount of profit earned on each sale
- Quality of the customer’s experience with the website.
- The amount of expenses the business is incurring.
- Ability to expand the business efficiently and effectively.
Generally, speaking a new start up business should be profitable within three years if it is going to become profitable. In fact, the Internal Revenue Service (IRS) expects a business to be able to show a profit in 3 out of 5 years. If not, they will start questioning whether the business activity is really a hobby rather than a business. There are a few exceptions to the IRS’s three year rule and they that relate to businesses involved in raising horses.
Good news: There are very few ongoing costs associated with an affiliate marketing business
The good news is that affiliate marketing does not require a lot of ongoing expenses to keep operating during the start up phase like many other businesses do. A person can operate an affiliate marketing business from the comfort of their home or sitting at a computer in public library. However, other types of business require a lot of ongoing costs whether it be inventory, salaries & wages, or feed for animals. For example, I have a ranch that sells eggs and meat birds. I have to buy baby chicks and wait for them to grow. My chickens consume hundreds of dollars of feed every week even if they are too young to lay eggs or too young to be sold.
On the other hand, I had could have an affiliate marketing website that is focused on chickens and I only have $13 of direct costs related to renewing the domain name.
That said, if you are still interested in learning about starting an affiliate marketing business, monetizing your website or blog, or driving traffic to your online store, I highly recommend you participate in some sort of affiliate marketing training program.
According to the IRS, if you want to claim your website as a business endeavor, then either you, or your advisers, should have the knowledge need to conduct the business profitably.
Affiliate Marketing Training for Beginners
If you are interested in creating an affiliate marketing business or monetizing your website, I recommend participating in a training program to shorten the learning curve. The shorter that your learning curve is, the sooner the website could generate some revenue.
Overall, I consider myself to be a fairly intelligent person. I have a degree in business administration. I was licensed as a Certified Public Accountant (CPA) and a real estate broker. Plus, I have had experience blogging on a real estate network. Yet, I don’t think that I could have learned enough about affiliate marketing without following an organized affiliate marketing training program.
Technology and internet programs are constantly changing and evolving. There are simply too many things to implement, ideas to consider and distractions from bright shiny objects. I needed a step by step training program. I have also benefited from having lessons that could be repeated as many times as necessary. (Sometimes it is easy to skip over something when you don’t fully realize the significance of it.) The training program that I followed made building a website or blog seem easy.
How to Find an Affiliate Marketing Training Program
I got lucky when I stumbled upon a good affiliate training program. Granted, I still conducted my due diligence before handing over my credit card information.
Early in my career as a Certified Public Accountant, I used to investigate fraud. To this day, I still tend to trust yet verify. Around this time last year, I was googling an internet marketing training company that a friend of mine was using. He was paying them about $300 a month. I thought that was a ridiculous amount of money to be spending. I was concerned that my friend was getting scammed by the training company.
Anyway, I saw the company he was paying was indeed a legitimate internet training company. They simply charged more than I would be willing to pay. However, as I was researching that company, I stumbled upon a company called Wealthy Affiliate.
To make a long story short, I became intrigued with the idea of affiliate marketing. I signed up for the Wealthy Affiliate programs free introductory training. After a day of going through the free training, I realized that I would need to join their regular program. Otherwise, I would not have adequate time to learn everything that I wanted to learn about affiliate marketing. So, I signed up as a monthly member so that I could cancel the membership when I was ready. A year later, I’m waiting for Wealthy Affiliates’ annual Black Friday special so that I upgrade to a yearly membership. (The Black Friday Special is for $299 for the year versus the regular $359).
Things to Look for in an Affiliate Training Program
There are a number of successful bloggers that are offering affiliate training guides or programs. I have not tried them because the Wealthy Affiliate (WA) program has worked for me. I”m still learning from WA and benefiting from my membership. For example, the membership includes my ability to operate up to 25 websites on the Wealthy affiliate server. If I leave, I have to move my websites to another host otherwise I would lose access to them.
The important thing is that you find an affordable program that you are comfortable with.
11 Things to look for when comparing affiliate marketing training programs.
1. Is it affordable?
2. Are you able to try out the training program before you have to buy it?
3. How long will you be able to access the training? One day, one week, one month or as long as you remain a member
4. What kind of format does the training come in? Is it all online webcasts, recorded videos, files that you can read, or a combination? Does it match your style of learning?
5. How frequently is the training updated? The way that Google presents search results changes frequently. So does many other things in the affiliate marketing industry. Training needs to be updated in order to be relevant.
6. How frequently is new training added?
7. Does the training program offer ways that you can practice your skills? For example, in the WA program, there are blogs, chat groups, reviewing other people’s websites, opportunities to create training. In each of these cases, the “student” is practicing and using skills that are needed to be a successful affiliate marketer.
8. Does the program start at a basic enough of a level? For example, WA first helps its members select a niche. Then a domain name. Next, the training lessons walk members through the process of their own website.
9. Would you build an affiliate marketing website as you progress through the training or are you just learning how it is done?
10. Are people available to answer questions?
What other perks are available to members?
- Are you able to build a free website on their platform? If so, how many.
- Would you be able to build a website using your own domain name? If so, , how many?
- Would the domain name have to be purchased through the training company?
- To simplify things, would you have the option of purchasing the domain name through the training company?
- Can you move the entire website to another website hosting provider if you want? This is extremely important.
- What kind of tools are available to facilitate keyword research and writing content for website pages or blog posts?
Note to Small Business Owners Looking to Increase Sales Using Affiliate Marketing
Business owners are on the other side of the affiliate marketing equation. If you are a small business owner, you will be competing for the attention of affiliate marketers. As with everything else you face in your business; well-established companies have an inherent advantage. Affiliate marketers tend to promote companies and products that they know and trust.
This does not mean that small business owners can not benefit from learning affiliate marketing principles. You can apply affiliate marketing strategies to any website to help generate traffic.
Small businesses can also sell in online marketplaces such as Amazon, EBay & Etsy. All three of these market places utilize affiliate programs to attract ready and wiling buyers. Their fee structures already incorporate affiliate marketing. As result, there is no additional cos .
Of the three, Etsy’s pays the smallest percent of commission to affiliate marketers. At the same time, they charge sellers the smallest fees.
Affiliate marketing is not a myth. Nor is affiliate marketing a scam. Instead, affiliate marketing is one of many possible advertising & marketing “tools” that a company can utilize to attract customers to their online stores or websites. Do you want to monetize your website or blog? Have you thought about starting an affiliate marketing business? If so, , there are plenty of opportunities to do so.
Every type of product sold represents a potential affiliate marketing opportunity. As result, people that are passionate about the subject they are discussing, may find affiliate marketing highly rewarding. At the same time, affiliate marketing is NOT a get-rich-quick sort of opportunity. A good affiliate marketing training program should help you get your business up and running.