One of the first things that became apparent to me when beginning my affiliate ventures was that tracking is the most important aspect in this industry. In the beginning of the journey you track the source that your website visitors have arrived from, all the way to relying on the program you promote to track the sales that those very same visitors have later partaken in.

I’ve been diagnosed as having stat OCD by my colleagues, so it was no surprise when I quickly noticed a flaw in most affiliate systems. Despite being able to see the clicks you’ve sent programs, you can’t see which source those clicks originated from; therefore struggle to be able to optimise your traffic sources effectively. You may know that you send a particular program 500 clicks per month, but if you know where the visitors that make these clicks come from then you’ll be able to target them more aggressively.

We’ll talk more about the benefits of tracking these clicks later, for now however I’m going to show you how you can begin tracking outbound affiliate clicks through Google Analytics as a goal.

How to add tracking:

1. To start simply enter into the site profile which you want to track and click on the settings section in the top-right corner.

I have always been a more active affiliate marketer than “true” business entrepreneur. I appreciate the anonymity that affiliate marketing provides me. If a customer does not like the service or product sold through one of my affiliate websites, they do not complain to me! Instead they direct their complaint to the company providing the “true” service or product.

But on the other hand as an affiliate you are very reliant on your merchants, you also forego that extra potential profit that you could make distributing your own products or providing your own service. In short although I have always concentrated on affiliate marketing I believe offering your own service is not only a more stable business model but also allows easier exponential growth.

The three levels of online business.

There are a number of online business levels that can be considered; by this I mean you can freely choose your participation level in your business. Each have their advantages but for the most part these advantages have a “yang” negative.

Affiliate

By trading as an affiliate you are in effect marketing another companies product or service in return for a predetermined commission on a per lead, per sale or percentage basis.

Advantages

• Core business is marketing.
• Easy & cost effective market testing (can change market focus quickly & without substantial investment).
• Little if any investment in technology (payment processors, stock control systems, etc)
• No Investment in stock, labour, or premises required.
• No customer contact required.
• No servicing requirements.
• The ability to sell services or products from already recognised corporate brands, rather than an offer from an unknown entity (often helps make the sale)

Disadvantages

• A reduced profit margin from what would usually be expected if you were providing the service or product directly.
• A much reduced opportunity for repeat business (if at all).
• Increased difficulty in obtaining acceptance from the Google search engine to take part in PPC advertising.
• Difficult to create a brand when not marketing your own product or service.

Outsourcing

The term outsourcing is perhaps misleading, although probably factually correct. What I refer to is those businesses that either outsource the service that they claim to provide for profit or alternatively dropship goods. This term would probably also fit well with many white label solutions. These businesses all “mark up” the product or service that they in reality purchase from someone else as part of an ongoing agreement.

Advantages

• Core business is marketing & Customer service.
• Easy & Cost effective market testing (can change market focus quickly & without substantial investment).
• No Investment in stock, labour, or premises required.
• The ability to build a brand & benefit from repeat customers.
• The ability to easily get acceptance from Google to run a PPC campaign.
• You choose your own “mark up” & profit margins.

Disadvantages

• A reduced profit margin from what would usually be expected if you were providing the service or product directly.
• Inability to control product or service quality, and risk potential loss of custom as a result.
• Time spent dealing with pre-sales questions, and support
• Inability to compete on price level due to the increased outsourcing costs (when compared to providing the service yourself).
• The need for a business address & contact telephone number (that must be covered during business hours).

Full Service

This service is as close to a brick and mortar business as any online business can be. In many cases this set-up will require an office and the necessary skills to provide the service offered. The profit margins will be highest, and should be large enough to enable the company to offer an affiliate program of their own, or have dedicated resellers.

Advantages

• Core business is marketing, customer service & service delivery.
• The ability to have complete control over your brand, and service quality.
• The ability to setup and run an affiliate program for your service.
• The ability to recruit resellers.
• Benefits of repeat customers.
• The ability to build a brand & benefit from repeat customers.
• The ability to easily get acceptance from Google to run a PPC campaign.
• You choose your own “mark up” & profit margins.
• The ability to compete with well established companies & brands.

Disadvantages

• Time spent dealing with pre-sales questions and support
• Time spent processing orders & maintaining your service.
• The need for a business address & contact telephone number (that must be covered during business hours).
• Possible required staffing costs.
• High advertising costs to maintain business & cover higher expenses (Premises & Staff).
• The need to ensure that your offering is both competitive and full-filled by skilled diligent staff.

The above guide is by no means complete and is only meant to provide some food for thought, and help you decide what form your new online venture should take. Remember that just because you start as an affiliate, reseller, or full service business does mean that this is how you will have to continue for the longer term. Although it is probably much easier starting as an affiliate and working your way up than the other way round.

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The promise of this article is that if you avoid making the 3 common mistakes listed below then you will dramatically reduce your learning curve in affiliate marketing, and are much more likely to see results — sales — sooner rather than later.  You will also save your time, energy and money by not flogging a horse that was never alive in the first place.  Most importantly you will reduce the likelihood that you will be like so many other beginners and give up before you even get started.

1. Don’t choose the “make-money” niche…

This a very common mistake made by complete beginners. They see all the get-rich-quick ebooks and courses, see how much they are selling and claiming to make in profits, and so assume this must be where the money is. If you choose this niche you are almost guaranteed to fail because you are literally relying on fraud to make money, and unless you have a proven career as a fraudster you won’t be able to compete at this late stage.

There are perhaps some ethical considerations here too?! Beginners who try this route often rationalize their behaviour with the belief “I’ll learn how to make money online by teaching others how to do it”, which is of course nothing but a subtle pyramid scheme, reliant on a constant supply of new suckers to keep money flowing to the scammers at the top. In any case, even if you have the best of intentions and genuinely want to help people you simply cannot learn how to make money online by teaching others – you have to learn how to make money online for yourself FIRST! Otherwise you are a fraud just like the rest of them.

When I see these make-money scams I am always reminded of those adverts you used to see in the classified sections of newspapers, the ones that say things like “learn how to make £2k in 1 week, just send £5 and a stamp addressed envelope to the following address…” And then the person would receive a letter In reply telling them to “run an advert in the newspaper saying ‘learn how to make £2k in 1 week, just send £5 to the following address” and on and on it goes, waiting for the next batch of suckers to keep the system moving. And guess what those guys are doing these days? Selling get rich quick schemes online, of course.

One possible exception to avoiding this niche is if you already have proven success at making money online and you think you would enjoy teaching others how you did it. However, in this case what you are actually doing is creating knowledge and systems that others can use to build a REAL online business, not simply showing them how to “make money online” using the latest sneaky trick, with a cash-grab mentality.

DO NOT TRY TO SELL “MAKE MONEY ONLINE” PRODUCTS IF YOU ARE NOT MAKING MONEY ONLINE!

2. Don’t jump on the bandwagon of what is popular right now; avoid “me-too” sites…

Many beginners are tempted to choose their first niche based on what is popular and doing well right now. Examples of these are voucher code sites, cheap flight tickets, huge comparison sites and weight loss. You see the massive amounts of traffic they get, you hear rumours about how much profit they are making and think “gee, that looks like where the money is, I think I’ll start one of those websites.” Then the typical newbie goes on to replicate the exact style of website used by the top few sites in that niche, then copies their marketing and copy, and sits back expecting traffic and sales to come rolling in. And when they inevitably don’t then they give up affiliate marketing and go buy the latest “magic bullet” info-product and probably go on to make the exact same mistakes all over again.

Jumping on the bandwagon and copying one of these successful large affiliate sites is a flawed strategy for a number of reasons. First, they have a massive lead on you as the top sites in every niche will be several years old. By the time you could get to their level of content and links guess what? They’ve spent the last few years growing and expanding and you are still miles behind them in the rankings!

Second, related to this is the fact that what is fashionable today might not be fashionable and popular in a few years time. Something similar happens in the Hollywood film industry. When a certain genre of film becomes popular and does well at the box office, then the studios are inundated with copycat screenplays trying to jump on the bandwagon. However, the time from script to release is usually several years so by the time the movie is in the cinemas the fashion will have changed completely. Writers who go for “me too” ideas invariable are of less quality because they are not following their passion and true interests. The exact same thing is true in affiliate marketing – how passionate are you really about flight tickets or voucher codes?! Dream about them every night do you? Always wanted to be a voucher salesperson when you grew up?

Third, there is simply too much competition! No one has a hope of becoming the authority site in any of these mega-niches unless they have a HUGE amount of money to spend and are happy to wait for several years, or have the capital to buy an existing website and improve it. Most of these big affiliate websites will have a team of people working on creating content and making deals with merchants, and another team of people building links and doing search engine optimization, not to mention huge budgets to spend on things like Google Adwords.

Fourth, the customers in these niches are pretty well served by these websites, many of them are excellent at what they do, so there is very little space for someone new to add value to the industry. In order to make money online with affiliate marketing you need to create value for other people. This means a useful website with useful information, a site that solves their problem. Now unless there is a major problem unresolved in these industries why would internet users not just use one of these long established and proven websites that appear in the top search engine results? And why would other website want to link to you if you are just a “me-too” site with no added value for THEIR visitors.

DO NOT CHOOSE A NICHE JUST BECAUSE IT IS FASHIONABLE AND LOOKS LIKE A MONEY SPINNER!

3. Don’t choose a topic you have no interest in or knowledge of…

The only exception to this is if you are prepared to pay other people to create content and build backlinks for you right from the start.  I will assume that this doesn’t apply to 99% of beginners who are looking to make some money before spending a fortune on outsourcing and hiring staff. If you choose a niche that you have no passion for, no interest in, or no knowledge of then you are likely to give up quite early, long before you start seeing some decent results.

With most affiliate sites, especially content based sites, you are going to have to write massive amounts of unique content on a regular basis (often daily), and you will also need to roam the internet finding similar websites to get links from. In other words you will have to immerse yourself in this topic for months and years. If you pick something you are bored by just because you think it is where the money is, then you will of course bore yourself on a daily basis!

There are VERY few people with the consistent self-discipline to make themselves work on something they have no interest in over the long term. Usually you will hit a plateua, sooner than you think by the way, and if you have no passion for the topic then you will simply give up and do something else. It is a much better idea to choose something you have a genuine interest in, if possible, and try to find the sweet spot between following your PASSION and a niche that could actually MAKE MONEY. Choosing a niche that has these 2 features is an art not a science and with many people it might take a couple of attempts to get it right.

Now, I am not saying that it is impossible to make money in a niche you have no interest in – I do this successfully in the finance niche – but it makes it a hell of a lot more difficult than it needs to be. My website in the finance niche was given up on and left for dead for over a year because I got bored of the topic. It has only been profitable since we started spending money on paying others to build links and write content for us. And even then we only risked spending money on it because we knew from an (expensive) Adwords campaign that it had potential to be profitable in the organic search results.

Some of the most successful affiliate sites are run by people who are passionate about their topic. Many bloggers make money online by promoting affiliate products in their posts and articles. For example, if you have a passion for mixed martial arts then how much easier to write about it every day and make some money on the side by linking to online shops in your adverts, or to specific gear in your product reviews.  You don’t need self-discipline in this case, you will WANT to write about it anyway!

DO NOT CHOOSE A NICHE YOU DON’T GIVE A SHIT ABOUT!

Conclusion

For your first affiliate niche it is vital that you can get some results early on – i.e. get some sales and make some money! – so that you are motivated to continue and don’t give up at the first few problems. There is no bigger incentive than some money in the bank no matter how small and no matter the niche – most beginners have a nagging doubt somewhere in the back of their mind that it might actually all be a load of bollocks and it’s impossible to make money online.  Immediate results are the key to motivation, not complicated systems of time management or ebooks promising the “hidden secrets the gurus don‘t want you to know.”

QUESTION: what is your biggest problem or frustration when choosing a niche?  Please leave a comment below and we’ll see if we can help…

It is not a “how-to” style article (we have plenty of those on the way!) but is just intended to get you thinking about ways to improve your business and make more money.  If you are an affiliate marketing beginner then hopefully I can help reduce your learning curve.

I’d love to hear from people about their own biggest mistakes and what they learned from them, so if you’ve got a good story then please leave a comment at the bottom of the article.  Ok then, on to our first sin…

1. Pride

There are two types of pride and for the sake of argument let’s just call them true pride and false pride.  True pride is having high self esteem, thinking well of your own work and accomplishments, and engaging in healthy competition with other people.  I’m all for this and think that it is vital if you are to make a go of building your own online business: proud people have big goals and actually want to achieve them rather than just talk about them.  False pride on the other hand is negative and comes from a place of weakness rather than strength.  Here are some examples of false pride that might afflict the online business man or woman.

Example 1: Thinking that you know best and not testing things.

These days it is fashionable to pay lip service to the power of testing, and with the rise of online tools that automatically track clicks and conversions it seems that everyone is measuring and testing everything all the time.  In reality not many people make purely data driven decisions, and often we just go with hunches and make assumptions about what the results will be.  Let me give you an (expensive) example from my own business…

We have an affiliate marketing website in the finance niche which is doing pretty well.  The site is basically just a comparison of several UK companies offering the same product and we get paid a commission for every lead that we send each of them.  There are only a few companies offering this financial product, and in fact it is really a niche within a niche.

Important note: narrow the niche, keep niching down until it “seems” too narrow then TEST it – I think you’ll be surprised at how narrow you can go and still make money – we thought this niche had too little traffic but within a year we are position 2 in Google in the VERY competitive finance niche (which NO ONE teaching affiliate marketing recommends you should enter…) and we’re now making a living from this site alone.

We had been trying for ages to add a new merchant to the comparison table but they were dragging their heels over running their affiliate program – they prefer to pay per conversion than per lead and have had bad experiences with affiliates in the past.  However we  can’t track the leads we send them without an affiliate program (as we don’t take customer data) so we just gave up, assuming it was impossible to work with them, and left it a few months.

Eventually a very likable guy from this finance company called me up seeing if we could work together and we agreed a compromise where we get a nominal fee per lead through an affiliate program but with the bulk of our commission coming at the end of the month according to conversion.  Perfect.  A little bit of lateral thinking and we could have had this up an running 6 months previously – but no,we knew best, it was impossible to work with this particular merchant.  So at this point we are delighted we got a great deal together and now we will have a truly comprehensive comparison website.

Then the guy sends us the affiliate landing page: yuk!  It is hideous and cheap and reeks of dodgy internet scam in our opinion, so we refuse to add it to the site and tell him we need a new one, a prettier one, one that we know will convert unlike this disgusting amateur mess.  He drags his heels, another month passes and then he suggests just trying it for a month to see what happens.  We don’t want to use it but have no choice and throw it up on the site in our very best converting position (which is not number 1 by the way!) with the intention of proving to him how rubbish it is so he will be forced to get a new landing page designed.

BANG!  We start getting massive amounts of leads for this merchant.  We can’t believe it, but soon start convincing ourselves that there might be plenty leads but they won’t convert so we won’t actually make any money from this.  BANG!  At the end of the month we get our commission through from the new merchant and it DOUBLES the site’s monthly profit and adds at least £20k to the value of the site.

The lesson?  We thought we knew best, we made assumptions about what would and wouldn’t convert, about what our visitors – people we have never met – would like or dislike.  We could have tested this in a non-emotional way and started earning this extra money months ago.  Stop assuming you know best and start making data driven decisions.  And this means testing things that seem counter intuitive or “certain” to fail because you simply don’t know until you run a test and look at the numbers.  Sorry if this dents your human ego and need to be right all the time but you have been wrong in the past and you are probably losing money right now from an untested assumption guiding your online business.

Example 2: Constantly checking your stats and commissions to make yourself feel good and/or boasting about your profits to feel superior

Photo of a guy holding a big cheque anyone?!  Man draped over a sports car perhaps?!  You see these guys boasting about their earnings all the time and they might induce awe in a couple of people but most of us just think either “that’s not his car” or less sympathetically “what a twat”.  Now, I’m sure lots of these guys really are making a lot of money but in the same way a truly hard man doesn’t get into any fights, a truly wealthy person doesn’t go on about their money – they don’t give a toss about impressing the rest of us, they have nothing to prove.  All this showing off is just low self esteem and revenge seeking, perhaps they were bullied at school?!

It IS legitimate to show proof to people if you are taking their money claiming you can teach them how to do something.  I prefer to absorb someones free materials first while researching their connections online – you can get a pretty good understanding of someone by the friends they keep, and the internet makes this very easy to find out.

A less extreme version of the above mistake is the person who constantly checks their stats in order to make themselves feel good, they enjoy the little squirt of emotion, but apart from the essential measurement of business activities they should really be spending this time building their business.  I have gone through periods of this and it’s difficult to differentiate between checking the health of your business regularly (essential) and procrastinating by flicking through the numbers every time you can’t be bothered doing something that requires focus and energy (mental masturbation.)  Learn how to stop checking your stats and become more productive.

2. Lust

Example 1: Always chasing the next big thing, the latest fad.

Any man (or his girlfriend) knows that when walking down the street his eyes have a mind of their own…. well it’s the same on the internet, in fact it’s even worse, because you can always get what you want online!  We are bombarded with articles, ideas, images, products, adverts all throughout the day on every website we visit, no wonder people these days find it so hard to focus.

In the internet marketing industry there is some new “magic bullet system” every single week it seems, and their is massive temptation to stop what you are doing and chase the next Great Idea.  It’s pretty obvious that if you do this on a regular basis it wil be impossible to accomplish anything and months and years will fly past with nothing to show for them -  trust me, I’ve been there and it held my progress back by at least a year.

The solution is just to ignore new product launches (unsubscribe to all those “guru” newsletters!) and focus on what you’re testing first and only if it fails move on to something else.  And don’t try and persuade yourself that you need to “keep up with industry news”, nothing major is likely to happen during your test period.

Example 2: Starting too many projects at once, replicating your existing sites too quickly and not consolidating/optimising what you have first.

Another “sin” I have been a genius at… the fact of the matter is, there is not a single business/website in the whole world that could not be optimised and made to make more money.  If you have a money making website then there are definitely things you can do to improve it, there is no need to go starting something new all the time in order to make more money.

In my case, I had a website making around £1,000 net profit per month at which point I thought it hit a glass ceiling and would never make more with this site.  So I spent the next few months trying new websites so I could increase my monthly earnings.  After a while of building new affiliate sites that of course didn’t make any money I went back to the first site and tried to make it better.

After a couple months of FOCUS on this site (and investment) it is now making more than triple that figure, and opportunities with new merchants are arising all the time.  I have also realised a way we could take it to the next level and build a great backend income source from the front end affiliate site (hint: we could become an affiliate for our own product!)  Without focus I wouldn’t have allowed my brain to work away on a single topic and come up with creative ideas.  A good rule of thimb is: think deep and narrow rather than broad and shallow.

Lesson: It is infinitely easier to improve something that you KNOW works than it is to start something new and HOPE it works.  Look at you biggest money making website exclusively for the next week… how can you make it better?  How can you add traffic, increase conversions, improve content, upsell, cross-sell or add backend offers?

3. Gluttony

Image Credit: Al Barrelli

Example 1: Reading too many blogs and how-to articles, paralysis by analysis.

If you eat too much food you become fat, bloated and find it difficult to run in a straight line.  If you take in too much information you become confused, unfocused and find it difficult to think straight.  One of the best things about the internet is how easy it is to find how-to style information for free on almost any topic you can think of.  The flip-side of this is information overload from reading too many blogs and articles, or doing so much “research” that you never actually get started on anything at all.  Related to this is paralysis by analysis, where you spend so much time analysing data and trying to figure out the best thing to do in advance of actually testing it in the real world.

Every single technique for making money online has its detractors and opponents online, you can find them on any forum – negative people are the flies of the world wide web…  My solution was to choose ONE how-to style teacher (e.g. a blogger) and copy their strategy until it worked or proved itself a failure.  And ignore all the others for now… they’ll still be there when you come back in a few months.

Example 2: Buying lots of  information products, consuming rather than creating

A big problem for many people starting affiliate marketing is that of buying every new information product that comes out.  If you do this two things are sure to happen.  1. you will become poor. and 2. you will accomplish nothing.  A great model for looking at what you should be doing in your online business is that of create, connect and consume.  You need to create a new website if you want to make money affiliate marketing of course.  If you want to get high quality backlinks you need to connect with other people in your niche.  And if you want to learn new information to help your business then you may need to consume information from experts.

There should be a balance between all 3 tasks, so look at your daily activities, it is likely that there is a heavy emphasis on consume to the detriment of create and connect.  Unless you are a professional book reviewer it is likely that consuming very rarely actually makes you any money.  Set up your work day or work week so that you do some of all 3 activities every day in order to grow your affiliate marketing business.

4. Greed

Example 1: Falling for every get rich quick scheme

Everyone in the world wants to make more money, a few lying hippies notwithstanding.  This is perfectly natural but unfortunately it appears to be human nature to want a quick fix and only be able to think short term – we want money NOW!  But as every successful business person says in some way or another, you have to be in it for the long haul, you need to think about long term rewards rather than short term highs.  Methods for making money exist on a sliding scale of integrity.

There has been a proliferation of get rich quick schemes since the internet was invented, as the online world makes it veryeasy to trick people and take advantage in an anonymous way.  Getting someone to click a button is lot easier than getting them to write a cheque and take it to the post office like is required of traditional junkmail.

New pyramid schemes…  Remember those old classified ads that went something like: “Send a self addressed envelope with £5 to this address and I’ll teach you the secret to making £10,000 in 2 weeks”?  And when you get the letter back in the mail it explains “run an ad in the newspaper saying send a self addressed envelope with £5 to….” etc.

Well this rotten format works perfectly on the internet as it’s all done with links, clicks an online payments rather than snail mail and cash.  The most common are ebooks explaining “the secret” to making cash online.  An the secret is… sell lots of ebooks to people claiming to know the secret to making money online!  These are simply pyramid schemes with no substance or value behind the product, they just rely on the next batch of suckers to keep the money flowing upwards

Example 2: Always focussing on “making money” rather than on creating value for others.

No one spends money on things unless they feel that it will add value to their life in some specific way.  No one buys your stuff or clicks on your affiliate links because YOU want to make some money.   So the logical conclusion would be to try and create something of value to other people FIRST then work out how to make money from it afterwards.

For example, a useful content based website that gives lots of free stuff up front to attract people and ADD VALUE to their browsing experience in the hope that if they like what they find then they might go on to purchase some of the products and services that you recommend.  Think of the opposite approach: the blog with no traffic, rubbish content, but covered in ads…. it is obvious this owner of this site wants to make money and nothing else.  The result?  You click away, never come back, and wouldn’t buy something they recommended if your life depended on it.

At every stage of niche selection, website design, and marketing, you should ask yourself “what does my customer want, what would be useful to them, what aren’t they getting from anywhere else and then build that for them.

For example, we found a range of products in the footwear niche that had very little information about who sold them online and where to get them from.  So we built an affiliate marketing based comparison website that showed them the online stores selling them, and listed the prices of each on our site so they could quickly and easily find the cheapest prices.  We thought “if I had decided to buy a pair of these shoes then I would hunt for the best online price.. it would be valuable for me to be able to compare all the prices in one place.”

Thinking like a customer causes you to make money. Trying to make money directly causes you to create low value websites that customers don’t want to use.  Everybody wants something.  The trick is to give enough people what they want first and eventually you’ll get what you want.

5. Envy

Image Credit: Morbandit

Example 1: Plagiarising other people’s websites and/or copying their niche

One of the biggest mistakes newbies make is to copy a successful website, often word for word, and expect it to do as well as the original.  They look at the success of someone else, see how much money they are making and decide to get a piece of the action.  This will almost never succeed unless you create value for people and in most cases they are so far ahead of you in the rankings that you quit long before you get anywhere near success.

A related mistake is to go into niches where all the big money is made e.g. flights, hotels, voucher codes, and expect to compete with the main players.  I very much doubt that any affiliate has a genuine sustaining interest in any of these topics so they will likely just quit and become disillusioned very quickly.

A much better strategy is to pick a very narrow niche, even if it doesn’t seem like it will make massive amounts of money, and work on it so you can see results quickly to motivate you and keep you working on it after the initial excitement dies down.  It is even better if you have a passion for the niche as this will keep working out of interest rather than requiring strong discipline on a topic that bores you.  However, this is not essential, my main money making sites are in niches I have ZERO interest in (finance and fashion.)

Example 2: Constantly comparing your own business to others and changing things

Related to the above mistake is the habit of changing what ou are doing every time one of your competitors does something new.  You have no idea if what they are doing is getting results, just because something looks pretty doesn’t mean you should copy it.  I think you should always be testing new ideas and trying to improve your websites, but any changes should be on your own terms, at your own pace, and as part of a specific test.  Feel free to take inspiration from other sites but don’t be reactive and fiddle with what is working just because you see others doing it.

6. Wrath

Image credit: Bobaloo Rox

Example 1: Getting angry at lack of success and quitting too early

Despite the claims of many internet marketing “gurus” in their sale letters, building a real online business takes time.  Affiliate marketing in particular, if you go down the SEO organic traffic route, can take months or even years to start making money depending on your niche.

It is extremely common for people to give up far too soon with a website and move on to the next one.  And then quit again in a never ending cycle of frustration and exasperation.  Anger is a useful emotion for motivating you to take action, for example my anger and frustration at being unable to go traveling was the spur that drove me to start an online business in the first place.

The trick is to expect periods of anger and low motivation during the initial stages of building your affiliate marketing websites, this is normal.  There are no hard and fast rules about at what stage you should consider a website a failure and move on to something new.

I gave up with my finance website for over a year thinking that it was a failure.  Then I decided to try SEO rather than PPC and I started to see results fairly quickly (from adding lots of new content) so this motivated me to keep going with this site.  I think only experience with a few failed websites will teach you to intuitively know when to give up and when to plough through…

Example 2: Wasting time arguing with merchants/networks/bloggers etc

The internet is the perfect place for moaners and negative, boring people.  Don’t get sucked into this world and start ranting in the comments sections of blogs just because someone disagrees with you.  All this mindless opinion-mongering will just waste your time and energy, and it’s like politics: you can’t do anything about it in reality, and all these opinions are in-actionable anyway, so just focus on improving your own life and business instead.  Sometimes merchants can be idiots and not know what is in their own best interests.  Don’t waste time arguing with them, just move on and work with someone else, ideally a company that nurtures their affiliates.  You’d be better directing the anger into creative tasks such as writing new content for your site or finding another niche to test…. success is the greatest revenge.

7. Sloth

Example 1: Not organising your time and resources properly

An interesting person once told me: Only mediocrities fail to organise their time and resources.  I have experimented with various time management systems and each have their advantages, but your personality type makes a huge difference to which one will work for you.  In my case I hate all those highly organised productivity systems that have you planning everything in minute detail, writing massive to-do lists every day etc.

Some basic strategies I find useful at the moment are: doing work in cafes rather than at home (a BIG one for me), focusing on one website per day, and thinking in terms of tasks and results rather than hours worked.  I’ll post more on these issues at a later date, but for now I recommend finding a physically separate place to do your affiliate marketing work, whether part of your house, a cafe or even an office if you can afford one.

Example 2: Not getting started in the first place!

I’m all for doing research before starting a new project but with the wealth of information (mostly bad) available online it is easy to suffer from “paralysis by analysis”.  It is not possible to think up a fool-proof plan that is certain to be a success with no risk of failure, there are simply too many variables and uncertainties.  At some point you just need to take the plunge and try something.

My method is to have some basic criteria and draw up a niche shortlist, then just pick the one that FEELS right and see what happens.

Example 3: Sitting at the computer 16 hours a day and not doing any exercise

Richard Branson of the Virgin empire was once asked “how do you become more productive?”  His answer: “work out”.  He says that this gives him an extra 4 hours of productive time every day.  This might seem counter-intuitive but exercise actually INCREASES your energy levels and helps you to focus.  Stop slouching over the keyboard and go do something physical, you’ll feel happier and more alive.  I often get my best ideas for affiliate sites while exercising.

So, it’s confession time…

This was just a little bit of fun to get you thinking about ways you can improve your online business.   Please don’t write in to debate the finer points of theology with me, I have no interest in how many affiliates can dance on the head of a pin….

However I would love to hear from you about mistakes you have made in the past and what you learned from them.  So, what have been some of YOUR most deadly “sins” when it comes to affiliate marketing?   Feel free to leave a comment below.

Happy hunting, KMac

1. You don’t need your own product or service to sell

You might be thinking “Eh? How can I have a home business without my own product or service to sell, why would someone give me money for nothing, this must be some sort of scam or pyramid scheme…” Well it’s not, don’t worry. Affiliate marketing is where you sell someone else’s product or service for them in return for a % commission. The most common methods are by having a link on your website or by sending out a link to your email list. Therefore, in theory, you could promote anything you want, any product or service, even if you don’t know the first thing about it!

For example, I run some profitable websites in the finance niche and, I assure you, I know absolutely nothing about finance, I just know how to get a website listed towards the top of the search engine rankings. Several finance companies then pay me a commission for every lead my website sends them. These are customers they wouldn’t have had otherwise, and they don’t cost them a penny in advertising costs, so they are happy to pay me a relatively large fee per lead.

So with affiliate marketing you don’t need to create your own product, which is time consuming, difficult and often expensive, especially for a beginner. Once the customer has purchased the product or service (which they found via your affiliate link) they are now entirely the responsibility of the product owner or service provider. This means that you do not have to carry an inventory of goods in a warehouse somewhere and then arrange shipping to each and every customer as the orders come in, also meaning there are no suppliers and timeframes to deal with and worry over.

Another benefit is that you don’t have to worry about providing customer support and dealing with complaints and questions about deliveries. There is no need to hire staff to run a call centre, take orders, deal with returns and all the other enquiries you are sure to get. By skipping this whole process an affiliate marketer can keep his or her costs down to an absolute minimum – they simply don’t have to get involved with paying for all these annoying and risky overheads.

2. Your business is not restricted to a single geographical location

With a traditional bricks and mortar business you are often restricted to a specific geographical region. For logistical reasons you might only be able to provide services or deliver goods in one part of the world. With affiliate marketing you can promote products and services that are sold and delivered in any part of the world, after all it’s called the world wide web for a reason, and you are in the business of delivering clicks to websites, not packages to houses.

For example, you might have expertise in a specific topic or industry that is concentrated in a single part of the world and want to build a business around your passion. Or if you are from a small country and you wish to tackle a bigger economy then affiliate marketing is one of the easiest ways to do this. For example, you may be interested in promoting products or services that have a big market in the USA but very little in your own country. There is nothing stopping you from targeting US consumers for a US company, getting them new customers, and they will pay you your commission just like anybody else.

Also depending on the nature of your website you may actually be able to target an international market all from the comfort of your bedroom. Or perhaps you’d like to see a bit more of the world than your wardrobe, in which case you might like point three….

3. YOU are not restricted to a single location

This, for me, is the very best thing about affiliate marketing. You can work from anywhere in the world as long as there is an internet connection and you have access to a computer. All the business activities take place online so there is NO reason why you need an office or shop in a specific town in a specific country, like you do if you are a hairdresser or a law firm. Online technology automates most of your operations so you can log in and run things from anywhere in the world.  For example, the affiliate networks will take care of all the commission payments so you won’t need to stay in your home country and chase up money on the phone!

In fact, I started my online business from my bedroom in Scotland and am currently writing this from New Zealand where I am visiting relatives en route to Thailand. If it wasn’t for the fact that I earn my money online I would not be able to travel – I might have money from a job but I’d have no mobility. In fact you can also be strategic about where you promote products versus where you live.

For example, I earn the majority of my money in UK pounds but by living in Thailand with the favourable currency exchange rate I can have a much higher standard of living for the exact same money. Everyone likes going on holiday to a poorer country with their Western currency which makes everything seem extremely cheap, but imagine being in this situation ALL the time. Affiliate marketing is the best online business for world travellers, so if you fancy yourself as a perpetual nomad then give it a go.

4. You have no boss and can choose your own working hours

Image credit: Bald Eagle by Chris Boyle

I’ve always hated 9-5 and have never been able to work productively during those hours. I am a night owl by nature, often getting my best ideas, and getting the most work done, in the middle of the night. Obviously tapping away on your keyboard until 4am isn’t really practical if you have to get up at 7am and commute to work for 9am on the dot or else. Affiliate marketing let’s you do all of your work at any time of the day you like. It’s all done online and via email, you don’t have to be in an office taking calls at a certain time, and it is not a customer facing role that requires your physical presence during a certain timeframe.

There might be the very odd occasion that you want to speak to a merchant on the phone about increasing your commission, but I’m sure we can squeeze a 20 minute phone call in somewhere between the hours of 9-5! The flexible working hours mean that you are in control of your life and no longer at the mercy of a boss or corporate system that seems to think all people have the same energy cycles throughout the day and take the exact same amount of time to get things done.

Working your own hours also means that if you want you can work intensively one week and then take the next week completely off and have a holiday. Your sites will keep working by themselves during this time, they needn’t require daily tasks if you plan your time properly. The old business cliché about “making money while you sleep” really is true with affiliate marketing – once you set things in motion they keep working for you, your site just sits there online making money (I’ve yet to have a call from my web hosting company to ask why I never checked in at 9am this morning).

The majority of the work can be done up front so you are able to take a few days off whenever you want. Indeed some people have such a great system in place that they barely work at all, hiring others to do the work for them. Everyone knows the stereotypical businessperson who spends 12 hours a day, 7 days a week on their business and doesn’t have any time or energy for anything else. Affiliate marketing let’s you escape the prison of working crazy hours in a business (even if it’s your own) and allows you to experience the beautiful world of owning a business instead. It is a great form of passive income.

5. You don’t need much money to get started and become successful

Image credit: Without Money by Toban Black

With a bricks and mortar business you have to spend thousands before you even start trading – premises, insurance, staff, equipment, stock etc. And after all this time, energy and money there are still no guarantees that your business idea will actually work and make enough money to cover your expenses and keep you in business, let alone make a nice profit. The amount of time and effort it takes to find and train staff is huge.

The big benefit of affiliate marketing is that you can start your business with very little money. For as little as the price of monthly web hosting you can build a site, write content and start getting traffic and potential customers. Obviously with extra money you can often make things happen more quickly by outsourcing such things as link building and article writing, and by buying advertising, but these things are not essential to get started. Not only are there very few barriers to entry, it is also easy to use this fact to test new business ideas regularly without bankrupting yourself or wasting all your savings on an unproven idea.

You can also start an affiliate marketing business “on the side” and keep working in your current job. This takes away the risk of throwing all your money into a new unproven venture and losing the lot which many, many people do every day. Apparently 40% of businesses fail in the first year, rising to 80% over the first 5 years, which means that a lot of people are losing an awful lot of money, often wiping out their friends and family in the process.

Many affiliate marketers started their career as a part time business for extra money on the side, similar to the way many people rent out a flat they own to make a little extra money. They work on their websites in the evenings and often into the early hours of the morning because they figure that building a business is probably a better use of their spare time than watching rubbish on television. And then once they are earning enough they quit their day job and do affiliate marketing full time. This path has the added bonus of meaning that you might have extra money from your job that you can invest in the business without worrying about paying your domestic bills at the end of the month. All of which removes stress from your life and frees your brain to think of great new websites for the future.

So, what is YOUR favourite thing about affiliate marketing? Or maybe you prefer a different online business model? Leave a comment and tell me what you think…