What is affiliate marketing anyway?

Considering the current financial crisis and rising unemployment, many have looked into ways of earning some cash online to supplement their income. Those looking for online money-making possibilities have inevitably come across the concept of affiliate marketing. This is essentially the idea of promoting an online business and receiving payments for every referral you manage to send to the business.

The method of compensation varies among companies, but the basic idea is to promote a product or service online and when you succeed in getting others to visit the company’s website, you receive a small cash payment for your efforts. For the company this amounts to outsourcing online advertising and promotion to affiliate marketers who work as independent contractors

Does affiliate marketing work for businesses?

Whether affiliate marketing is effective or not depends on perspective. For many businesses, the idea is excellent because it operates on a “pay for performance” model; meaning that the business pays only when an affiliate successfully generates tangible results. A number of major online businesses, such as Amazon.com, did very well with affiliate marketing in their early years.

Similarly, since the online business can develop its ownaffiliate programs that operate under its own terms and conditions, many online businesses have chosen to set them up. That said, affiliate marketers get few benefits from businesses that are local or have products that are mostly off line. Further, failure to properly restrict the activity of affiliates or to monitor for abuses also leads to many unscrupulous affiliate marketers giving the business they are promoting a bad name or negative associations.

Does affiliate marketing acutally benefit the affiliates?

It is undeniable that at least some people have built successful careers from affiliate marketing, but at the same time, it appears that the overwhelming majority of affiliate marketers make very little money, if any at all. Since affiliate marketers provide an independent service, the industry is more or less unregulated, meaning it is impossible to get exact numbers on how successful the venture is for some.

Another difficulty in assessing the effectiveness of affiliate marketing is that one of its primary niches is the selling of information about how to become an effective affiliate marketer. There is, therefore, a lot of misleading information online, and promoters typically have a veseted interest in getting people to buy “how to” materials. Since affiliate marketing is an online enterprise, people can basically say whatever they want you to believe, and it’s not like there are reliable sources you can verify. Just because one affiliate marketer claims to have made $ 60,000 a month doesn’t mean it’s true, and there’s no way to find out if it’s true, which it likely isn’t.

Who’s been successful with affiliate marketing?

Like any industry, there are occasional flukes where people succeed by sheer luck as opposed to skill or talent; but as always, these are the exceptions. In general, most of the confirmed successful affiliate marketers are people who already had a strong background in advertising and marketing before they took up affiliate marketing. Also, many proven successes are people who were there since the beginning in the late 1990s.

There are very few success stories about people who jump into the industry and become immediately successful, and the stories that do exist are impossible to verify. The few who have succeeded quickly usually had access to some new innovation, like a new niche, technology, or marketing strategy before many others caught on. Despite claims to the contrary, there is virtually no verifiable evidence that most affiliate marketers ever make significant amounts of money.

Getting Rich Quick? Not very likely.

Since so many affiliate marketers are making their money by selling instructional affiliate marketing materials, there are many claims that affiliate marketing offers the opportunity to get rich quick. These claims tend to resonate loudly in the current economic climate where so many desperate people are looking for ways to make livings or supplement incomes. However, as with most “get rich quick” schemes, most often it’s a scam. Even if you have an innovative concept that might open a new niche or market and even if you have a strong background in advertising or marketing, the odds are that it will take years to turn these ideas into enough money to live on.

While creating the online infrastructure for affiliate marketing can take a couple of months, actually making money can take a lot longer. Most of the confirmed successful affiliate marketers freely admit that it took them anywhere from one to five years before they were making enough to even consider dropping their day jobs.

Is affiliate marketing right for you?

If you already have a solid background in advertising or marketing or you have some brilliant new idea, you may be able to make a fortune with affiliate marketing. But in this case, don’t expect it to do so overnight, or be able to without investing time and energy. If you have no experience in the field, and you’re looking for a quick, easy way to make a little cash on the side, affiliate marketing can be a good way to make it happen.