1. How They Work.
Basically Associate Programs
reward website owners for referring customers to their business. Website
owners are rewarded for sending customers to another website (of which you
belong to an Associate Program for that website), and for any business
(sales) which is generated from the customer who linked through your site
to the other website.
These "Pay-Per-Sale"
programs are usually really easy to join. Just make sure you pay attention
and read the terms and conditions, because they can vary from program to
program.
As an associate for that
website, you are assigned a special URL which tracks all the visitors you
send to the website and all sales generated. You basically post a banner
ad, or a small graphic or a text link to the Associate Program's site and
you earn a referral fee from every sale that is made from that site.
You can also recommend the
Associate Program site (or the product or service) in newsletters, private
emails to your customer base or lead list, newsgroups, ezines or any other
way of marketing which you want to undertake.
Once you join a program and put
up the graphic or text link, whenever someone follows that link from your
site (or your newsletter, or your ezine advertisement, or your private
email to your customer, etc.) to the Associate Program owner's site and
buys a product or service from them, you receive a commission (or referral
fee as it is sometimes called).
Basically, that's how it works!
There are a number of Associate
Programs that don't actually "pay-per-sale" but actually
"pay-per-lead" or "per-click". In a pay-per-lead
program, you are paid every time your customer fills out a survey, asks for
more information, or gets a quote on a product (in other words your are
paid for giving the company a "lead"). It may be the kind of
situation where you get paid every time your customer downloads a trial or
demo software.
Pay-Per-Click is very similar. Basically, you get paid
for every time someone "clicks" through the link from your site
the Associate Program owner's website (whether it be a text link or graphic
link).
2. How You Get Paid.
There are different ways
companies will pay you.
Some pay you in credit toward
merchandise or services they offer (but not many). The rest usually pay in cash
(or more specifically, a check written to you each month).
Many companies have a minimum
"pay-out" balance. For example you would have to accumulate $100
in commissions (or whatever amount they choose) before they issue you a
check. Other companies will pay you no matter how little is owed to you…
they'll cut you a check even for a dollar or two. So be careful to read the
agreement when you become an associate… you don't want to be dealing with a
company who has some really high pay out where you have to accumulate
hundreds of dollars in sales before they will issue your first check.
Just so you know, the reason
they do this is to lower their costs so that they are not writing out
checks for $1.00 or $5.00 or low amounts like that all month long. They want
to wait until your commission accumulates to $50.00 or $100.00 or more
before they write you a check (so they write fewer checks every month and
have less bookkeeping to do).
On that note, make sure you do
business with a reputable company. I know many people (and I even speak
from personal experience) where you promote a company and you don't get
paid your referral fees, or you have to wait for months to get them because
they are just not set up for it. In other words, they are not taking their
Associate Program seriously enough and haven't bought the proper software
to keep things automated (they are doing too many things tediously by
hand).
3. Who Should Join an Associate Program... and What to Look For.
If you want to become a part of
an Associate Program you need lots of traffic. If you have a busy site or a
large newsletter you can start earning money right away!
But if you are a new site, a low
traffic site, or are starting from scratch, you have a long road ahead of
you… so be aware of that. If you are starting from scratch you may be
better off developing your own product or service and selling it. Remember,
when you sell your own product, you keep all the profit… when you sell
someone else's product, you only keep a portion of the profits.
That is not to say that if you
are starting off, you should not join an Associate Program... just realize
it may take a while to generate some income as you have to promote it and
build traffic just like you would if you had a website with your own
product or service. On that note, an Associate Program may be a great
option if you don't have a good product or service to sell online and need
one. Just find an Associate Program for a product or service you love and
would feel proud to.
The beauty of Associate Programs
is that they are "no-brainers". What I mean by that is if you
have a lot of traffic to your site, all you have to do is post a banner or
text link to another site (because you are part of their Associate Program)
and earn a referral fee for every sale which is generated. There is no
customer service, no credit cards to charge, no shipping of orders, no
inventory, no administrative problems, no employees, and no headaches. The
company takes care of all that for you… you just refer people to them, then
they take care of all the rest and cut you a check every month.
4. A Couple Of
"Rules" You Need To Consider When Joining An Associate Program.
Making money with an Associate
Program is a numbers game!
Basically what you are dealing
with here is that out of the people who visit your site or out of the
people who subscribe to your newsletter you may get a 1% to 20%
click-through ratio (this range is so wide because it depends on the
product interest, how you link to them and the power of their slogans or
banners). In other words, 1% to 20% of the people will actually click
though the banner or text link you have provided and visit the Associate
Program site you are recommending.
Of the people who click through,
only 1% to 5% of those will actually buy. So you're working on a numbers
game here. To generate good income from an Associate Program, it's all
about having a large number of visitors to your site or a large number of
subscribers to your newsletter.
Let's look at an example. Let's
say you are getting 1000 visitors to your site a month and you post a
banner ad (which generally has a low click through) or you post a text
link. Just for the heck of it, let's say you get a 5% click through (which
is high by the way). That means out of your 1000 visitors, 50 of them go to
the Associate Program site by clicking through on the banner ad or text
link, which you posted.
So now you have 50 people going
to your Associate Program site. Out of these 50 people probably only one
will buy, IF THAT!
If you get a commission of
$10.00, $20.00 or even $30.00, depending on what kind of commission and pay
out they have, you are getting paid $10.00 or $20.00 or $30.00 per 1000
impressions you make of that banner or text link.
In other words, for every 1000
visitors you get to your site you make $10.00 or $20.00 or $30.00!
That's it! That's the reality
and you have to look at it from that angle. Don't think that because you
are getting 1000 visitors to your site, (that is to your site, not to the
Associate Program you are recommending), that you are going to get $500.00
a month from your Associate Program. You won't!
Here is a little tip… a good
company with a good Associate Program will have about a 0.5% to 1% visitor
to sale ratio. It is sometimes better than that (and many time worse, if
you hook up with a poor company), but that is the average. So for every 100
to 200 visitors you sent them, one will purchase.
If you are finding that you have
to send 500+ visitors to a site to get a sale, then re-think your
participation in that Associate Program. Let me go into a little more
detail. If you were getting paid a $100 referral fee per sale (so for every
500 visitors you send them you get $100 on average), that wouldn't be so
bad. But if you are getting paid $10 referral fee per sale, you want to
re-think your participation in that program, as mention above.
Before you join any program, ask
the questions listed below and check out the various programs, which are
available for you to join.
Get
answers to the following questions before you join:
·
How
long has this Associate Program been in place?
·
What
form of compensation is offered? In other words, are you getting cash, are
you getting credits for your product, are you getting free AirMiles - what
are you actually getting?
·
Is
there a set up fee? If so, how much?
·
What
kind of associate tracking software is being used?
·
How
are referrals tracked? Do you get credit for every single sale you refer to
them?
·
Is
there third party auditing? If not, has the company you are dealing with been
in business long and are they reputable?
·
Does
their tracking software use cookies? CGI? Is it hidden in form fields? Is
it a database?
·
Do
associates get credit for the sale after a visitor comes to the site and
doesn't buy, then leaves and comes back to buy at a later date. How long is
this in effect for?
·
Can
you stop the agreement at any point? Do you have to take special steps to
get out of the agreement?
·
Does
the legal agreement bind you to any other responsibilities?
·
Did
you read the fine print of the affiliate agreement?
·
Under
what circumstances can the Program remove you as an associate?
These
are things you want to look for in an Associate Program:
·
An
Associate Program that is successful at what they do.
·
An
Associate Program which offers great value, a great product or service, and
more importantly, great customer service!
·
Make
sure the Associate Program has a great tracking mechanism so that you get
credit for every sale.
·
Look
for a Program, which tracks every sale in real time so you can see your
results instantly.
·
Make
sure the Associate Program has a good-looking website, which pleases
customers, is easy to navigate, and offers great information to the
visitor.
·
The
Associate Site must be able to turn visitors into sales, because you can
send them all the visitors in the world, but if they don't convert visitors
into sales you have just wasted all your time (as you are not going to make
many referral fees).
Click here to see how we select the Associate Programs
presented in this site
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