Affiliate Programs... A Not THAT Easy Start To Your Own Online Business

"Where is all the help Im 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 Lets go here. I spent all day on this. Im 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 shes 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 persons 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 dont 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, lets take a realistic look at affiliate programs, what they can and cant 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 affiliates 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 dont have to worry about creating your own product or service. You just promote someone elses and get a share of the revenue pie for your efforts.

You also dont 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 businesss 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 lions share of the profit on the sale.

Youre 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 youre first getting started, and a nice little sideline once youve 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. Youll 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 cant do for your business, lets 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 thats been around for a while and thats 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 youre 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 elses affiliate program necessarily requires that you divert traffic away from your site and towards someone elses. Make sure youre properly compensated with a high commission structure. And be sure to set up your link so that when the visitor cl