If you are planning to set up an online business and do not have a product to sell or if you are a webmaster in need of extra income, you may be interested in affiliate marketing as a solution. You will not have to worry about having products to sell, with affiliate marketing. All you really need is a website with relevant and sufficient content of the products of an online affiliate marketing merchant. You can begin to increase your income by a certain amount when you become a member of an affiliate program.
Affiliate marketing is a business relationship between a merchant and his affiliate. An affiliate marketer agrees to direct traffic to the website of a merchant. When that traffic is converted into some type of action, such as purchasing a product or a visitor becoming a lead for the company on the website of the merchant, the affiliate will be compensated. The application of the affiliate on a merchants affiliate program, will predetermine the type of compensation, whether it takes the form of being a fixed fee or a percentage of sales commission.
Affiliate marketing has become one of the most popular methods of online marketing, promising benefits for both the merchants and the affiliates. Fact is almost every retailer and merchant site will offer an affiliate program you can join. Most people are enticed into becoming members of their affiliate program by the promises of benefits, such as lifetime commissions, large commissions, click through incomes and several other benefits. However, are all these affiliate programs offering the same benefits?
Many affiliate programs pay their affiliates a one time commission for each lead or sale directed to the website of the merchant. This type of affiliate program generally offers large commissions, anywhere from fifteen to sixty percent. Other affiliate programs pay a fixed free per click onto their website, although these types are more likely to pay smaller fees, generally no more that fifty cents per click, sometimes less. However, no sale is required for you to make money when a visitor clicks on the link.
Then you have the residual income affiliate program, which generally pays a small percentage of sales commission for every sale you direct to the merchants website. This type of commission is generally paid in the range of ten to twenty percent sales commission. Residual affiliate programs are sometimes overlooked, because people may opt for the one time high paying commission affiliate program. Is this a mistake or the right decision.
Although, it is hard to tell if it is a mistake to choose a high paying one time commission affiliate program, it is a mistake to ignore the residual affiliate programs. Indeed they may pay a lower rate, however the merchant is offering to these programs would more than likely pay you regular ongoing commissions for a single affiliate directed sale. What this means is for the same efforts of promoting a particular affiliate program, you get paid once in a one time commission program, while the commission of a residual program is regular and ongoing.
Do you understand the benefits of promoting residual affiliate programs? This example, should clear things up.
Let us suppose that there are two merchants online, both offering web hosting services on their websites. Merchant A offers a one time commission type affiliate program, paying $80 for each individual affiliate driven sale. Merchant B also offers an affiliate program, only this time with a residual affiliate program that pays only $10 for each individual affiliate driven sale. Of course it is natural to be drawn to merchant A, since $80 is much more than $10. However, before taking either of them on, you must be able to see that merchant B is offering more of an opportunity to earn a larger amount of money in the end.
Now, let us suppose that you have driven traffic to the merchant and it converts into a sale, with Merchant A, you only get paid once. But with Merchant B, you get paid monthly as long as the consumer you referred to the merchant continues to do business with them. This means that the very same effort of convincing a consumer to use the service of a merchant pays you monthly with a residual affiliate program, while the one time commission type affiliate programs pay you, one time only.
Are residual affiliate programs worth promoting? Yes, because in the end, you make more money with these types of affiliate programs. Will residual affiliate programs work well for you? Sometimes yes, sometimes no. Since it really depends on your own efforts. However, the benefits of residual affiliate marketing make it worthwhile and it is not wise to ignore such great programs.
43 Comments
Sandra
November 24, 2008HI
It is wonderful to read your blog, you explain everything so well and now I am better prepared to do my job with better understanding.
Thank you.
Sandra
Rich Sears
November 24, 2008Reed,
Again, you inlightened me with your knowledge.
To your readers,never over look the”small money” that is where it begins.
To All of our Success,
Rich Sears
Mike
November 24, 2008A really smart way to go is to find a niche affiliate program that you have some interest and expertise in. That way you can use your knowledge to build up a website and drive traffic to a related continuity program.
tmobil8
November 24, 2008Greetings Read , Thomas Richmond here, sorry i havent posted lately, but affiliate programs are a newbies dream of getting started on marketing online the right way, find a niche, make it your own by looking at the same offeres others are selling like at clickbank, easy to find a nich, google search it, type: marketing (subject niche) and find it, then start building a list to market to. Simple. Till next time my friend. Enjoy your Thanksgiving week! 🙂
Alex C
November 24, 2008Overall, I used to prefer the GPT (Get Paid Today) affiliate deals because of the larger commissions paid right now…if you’re doing anything outside of Clickbank or CJ there’s always the risk you won’t get paid, the marketer will fail or give up, or just disappear before you’ve made any significant money. Better to get paid well once than poorly once or twice.
I agree now though that the right deals, where you earn lower percentages on multiple back-end products or subscription over time is better- if the deal is right and the partner is trustworthy. Done right, this can make mid- to long-term income much more predictable.
So I believe you’re right- Go for the big upfront single commissions while always keeping your eyes open for good residual income deals.
normz2
November 24, 2008Good post again. I have both types of merchants for affiliates. As I am fairly new in I.M. I am still finding my way as to which one is better. I am intending to start promoting by using an article then using part of the article in a blog using lead capturing techniques to get leads. Then following up with an autoresponder. I am advised that this is the most economical way to go. Once, I get started I hope to put out one blog a week for one merchant at a time.
EJ
November 24, 2008Reed, I couldn’t agree more. If you can keep generating income off your efforts without having to continue to duplicate them, why wouldn’t you opt for that?
Working hard always pays off, but working SMART always pays MORE! 😉
EJ
Ari Lestariono
November 24, 2008Residual income in my opinion still worth to work for, and it becomes a passive income when you just want to relax a little bit, with certain level you don’t need to promote, it’s your downline that do all the A-Z things as we have just done at beginning stage.That’s all
Ari Lestarionos last blog post..Home Remedies for Acne Treatment
Amy Stephani
November 24, 2008that is awesome blog there Reed okay keep it up my friend okay nice blog and i like your blogs you send out like that.
thank you,
Amy
Jim
November 24, 2008Reed,
This is an excellent question that has really got me thinking lately. I am working with a couple of new programs and was concerned that we would not get some of the top affiliates because the owners want to pay a recurring commission which is always smaller.
In your opinion what is the minimum per month you wouldn’t go below for a monthly commission?
Thanks,
Jim
michael
November 24, 2008Forgive me if I don’t offer a real comment, but I think you pretty much have summed it up. I would just add, you should try to re-purpose your efforts as much as possible.
michaels last blog post..Beware The Eyes Of March
David
November 24, 2008Residual income is the key to long term income and especially when you are first starting those “little” checks are much appreciated!
David
Misato
November 24, 2008Hello Reed,
I agree about the residual income, and that it is indeed good if you can earn an income on a residual basis, but, there is something that seems to be overlooed when others start praising the benefits of residual income opportunities.
That is, that there aren’t that many products or services that people will pay for on a regular basis that many people will pay for over the internet.
Case in point. Internet service providers. This is a good example of residual income, because internet access is usually paid for on a monthly basis, however…
This ISP’s aren’t that sought after in cyberspace, for the simple fact that anyone who surfs the net already has internet access, so this would be in very little demand over the internet.
Things that I can think of that pay a residual income are things like:
Autoresponder service
Magazine subscriptions
Maybe a subscription to some kind of membership website
Cable or satelite service
and, well, not too many residual pay products or services.
So maybe the reason why some people opt for the high commission instead, isn’t because the temptation of a bigger commission, but simply because there is not much to be had in the residual income area.
Well, that’s my 2 cents worth. I know that’s probably about what it’s worth, but there it is. ;D
Misato
Paul Livingston
November 24, 2008I agree. Given a choice, I’d go for residual every time…as long as I’m sure the merchant’s going to be around a while 😉
Paul Livingstons last blog post..The Internet Marketing Success Formula…can it work?
Anatoly Silkin
November 24, 2008Dear the Sponsor! On my Card a zero!!! Your first aid SOS is necessary to me!!!!! As rolling!!!???? Sincerely A.S.
Geoff Dodd
November 24, 2008Reed, so long as the Quality is high and people want to stay working with it, such as Ken Evoy’s SiteSell, or Host4Profit, then I’d strongly suggest the Residual, recurring, continuity Lifetime Value Model. Witness how all the big names are currently putting out monthly magazines and trainings, like Stompernet and Mike Filsaime and Frank Kern and others – all want the Continuity or residual model working for them. They’ve seen the light simultaneously about keeping the lifetime customer.
I was initiated as an Affiliate Marketer in the ‘online investigation’ niche which is a one time wonder and I believe it’ll die a slow death by not focusing on continuity and recurring income.
Geoff D
Australia
The beast
November 24, 2008Ok Thanks Reed ! Wheen i read feels like heard some of it many times.iam forrenger and newbi for almost 2year,And its along time and still I dont know ,What is he talking about ? I have hear it many times .So I must be dum or retarded? I dont think so or I hope iam not.For eweryone if you dont understand dont stay for 2yers and try to find out.Because its only a few who knows ,So I have made up my mind and its so simple.Do something you like to do ,because then you become good at it and when you are good at something Internet is the best place to be Because Folks dare to tell what they think .and when you here other say wow thanks you open my mind ,you feel love and joy and also Thanks Internet you get so many new ways new doors opend and Monney they come from ewery where for what ,You show what you where good at .Thanks Internet!! east the beast(thanks reed)
Lena Khalid
November 24, 2008HI Reed – good posting. I’ll go for Passive and Residual income, no doubt … but what I am afraid sometimes .. will the merchant last that long??!?!
Lena Khalid
Earning Online – My Way
Surf and Work from HOME – The Portal
Lena Khalids last blog post..You need a blog !!
John Counsel
November 24, 2008There’s no question, from a merchant’s viewpoint, that BOTH types work — one-time commissions and residuals.
At The Profit Clinic we offer both, PLUS GPT-type programs for certain products under our Viral Explosion system.
Our residual programs pay 35% up-front and monthly residual commissions on services like our IM automation system (integrated autoresponders, shopping cart, affiliate system, ad tracking, real-time reporting, etc) that costs from US$29.95 – $49.95 per month.
John Counsel
CEO, The Profit Clinic
arllan
November 24, 2008Reed,
Once again good information i guess either way you’ll make money i guess just a matter of advertising choice , i like to mix it up a bit but more of a 70/30 70% programs with commission right away and 30% residual but most likely again researching on the residual. Very good post.
PV Reymond
November 24, 2008Hi Reed,
Yes, it is worth it to promote residual affiliate programs because you can make more money and you don’t have to put much extra effort into it.
Also, you don’t have to spend extra money promoting the program. There are many advantages but the most important one is that at the end of the day you make more money.
Thanks,
^PV Reymond
http://www.startup-internetbusiness.com
PV Reymonds last blog post..Internet Marketing For Newbies… The First Step
Anna Kindler
November 24, 2008Hey Reed, Another good article. Like I said yesterday in my post. I keep on reading and putting to use your article info. Little by little I will be getting this affiliate marketing business working for me. Thank you for helping a newbie granne like me learn a lot of good information that will work. Don’t eat too much turkey. Anna
Jussi Koiranen
November 24, 2008Recurring sales are diamond. I know I’m very brand loyal once I’ve found a supplier that works. I work in Network Marketing as an active Marketer and promote my program and it’s benefits and customer solutions on my website.
As an internet marketer I am also affiliated with few sites that pay me for traffic delivered, mainly Adsense, AC and Weblo. But what is making me some bucks is that I’m affiliated with an professional speaker who publishes Network Marketing books and CDs. He sells his own products and other peoples products thru his site. He publishes an Ezine so that people visiting his site can opt-in and get great quality tips and info and return to the site. I as an affiliate get to keep all the money referrals I get there. Only time I lose a referral is when they use someone elses link to get to the site. If some of the people I refer there are nearly as good as customer as I am over time this will provide even more money.
Laurence Parr
November 24, 2008Yes , dynomite info, residual income will keep
on going and going , just like that
battery powered bunny rabbit.
Wayne Bell
November 24, 2008Reed,you are right on with this one. Sometimes we don’t think far enough ahead. This is just as true in life as it is in business. Long term planning is always the better apprroach.
Regards – Wayne
Terence
November 24, 2008With all the membership sites springing up now you can get a nice residual income if you can sign up people to them as an affiliate.
I have seen evidence of one residual income program recently which has fetched in $10,000 on autopilot. Who wouldn’t want this kind of payout for doing nothing? It’s a no-brainer.
Terences last blog post..Join The IM Dream Team And Help Improve Childrens Lives.
Jussi Koiranen
November 24, 2008@ Terence that would be cool! But it doesn’t come “for nothing” you have to actually promote the program and bring in someone who actually feels like it is worth the money month after month.
Aloko
November 24, 2008Yes/No,it is more profitable when you are commited. And no if you are not
Aloko
November 24, 2008Yes/No,it is more profitable when you are commited in promoting affiliat programe.You actually need to educate people about it. And not if you are not commited to programe.
Jerry Goodwin
November 24, 2008Hi Reed,
Excellent Post, great advice. I really liketh concept of residual marketing, and recieving payments over and over for doing the work once.
victor
November 24, 2008Hi Reed , for the last three months i have been searching for info on internet marketing leading me to receive alot of hype in my inbox.Reading your blogs has made me realise very valuable info which has gone along way to demystify the subject.This has sobered me up from the confusion and now i know where to start.Thank you Reed and God bless.victor virugu(kenya)
Slavica
November 24, 2008I am just interested in, what affiliate programs Reed Floren recommends to us,which run a Residual Income?
Best ones?
Slavicas last blog post..Long Live Witches
Pat Gunning
November 24, 2008You got it Reed! Residual income is the answer to every bad economic situation and the answer to a lost retirement fund.
This is the secret to long term income. This is how you make a one time sale pay endless benefits. It is the reason that some people earn high monthly incomes in network marketing programs.
Luca
November 24, 2008When promoting affiliate programs it’s always a good idea to look at how you will get paid. As you say Reed a recurring payment is better than a one time payment even though at first glance the one time payment looks like more.
Bruno Auger
November 24, 2008I like doing the combination of both myself. Sure ulimately you want to recurring income to come in because it will be monthly without having to promote it alot.
Ernie Carroll
November 25, 2008Great info Reed! I think the reason most new affiliates skip the “residual income affiliate programs” is because they have a sense of urgency to make a lot of money as quick as they can. I use the residual programs on the back end. Works pretty well for me.
Ernie Carrolls last blog post..Blogging to the Bank 3.0 – Honest Review
Ari Lestariono
November 25, 2008Hi Alex,
GPT, that’s interesting, anyway how old are they in this fields?
thx for sharing the info
Ari Lestarionos last blog post..Home Remedies for Acne Treatment
bet
November 25, 2008I’m just getting started at this internet marketing. I now am an Amazon affiliate. I want to take it slow and easy and let all this knowledge soak in. Thanks. bet
Geoff Dodd
November 25, 2008Hey Bet.. if you are working Amazon’s affiliate program you will have to do big volume sales because the commission percentage is relatively low. You’d need a book club type of site with a lot of members flooding in to read reviews or similar. BIG volume.
Geoff D.
Dora Kok
November 28, 2008It’s true and I always prefer long term payment even if it’s only a fraction of Merchant A.
admin
November 30, 2008@Sandra you’re welcome
@Rich agreed if you can make $1 online that’s probably more than anyone else in your family or your neighborhood has
@Mike agreed
@Thomas it can be very nice
@Alex That irks me a lot when an merchant won’t pay
@normz2 keep us posted
@EJ working smart is great
@Ari it’s definitely worth it
@Amy you’re welcome
@Jim That really depends on what it is if it’s a physical product or a service a lower figure is expected somewhere between 10-50% if it’s just digital 50%+
@Michael repurposing your content is fantastic
@David I love getting checks or paypal payments for things I don’t remember promoting that’s what residual income can do for you
@Misato I agree there are a lot less products and services out there currently that are attached to a recurring income model but I think we are seeing a major shift and a lot of products in 2009 and beyond will have some sort of membership angle.
@Paul that can be really nice
@Anatoly what?
@Geoff I think a lot of us will be having membership sites soon
@the beast you need to do something you’re passionate about
@Lena you may want to stick with businesses that have been out for a long time if you focus on promoting residual income products
@John agreed they both work
@arllan interesting. thanks
@PV agreed
@Anna you’re welcome
@Jussi nice
@Laurence thanks
@Wayne agreed
@Terence sounds bit too good to be true but if it works awesome
@Jussi agreed
@Aloko agreed
@Jerry yes it’s very nice
@Victor you’re welcome
@Slavica there are a lot of nice ones on ClickBank
@Pat exactly. Also let’s say that hypothetically your lifestyle requires you to have $5,000 a month to live on. All you need to do is get multiple residual income things going that make more than that so you can be “retired”
@Luca yep
@Bruno agreed I do both a lot as well
@Ernie yeah they are a nice supplement
@bet you’re welcome
@Geoff you bring up a good point either a list or the ability to send a lot of traffic so you can make anything with amazon
@Dora great
All natural skin care arbonne
December 15, 2008Thank you for the information, keep up the great work!
delords
January 31, 2009Residual Affiliate Program is a read affiliate deal, as one keeps earning from the same source over and over again, without sending additional sales,
that’s best for me who likes taking some time off for myself.
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