What is Affiliate Marketing?
Every product/service wants to reach and hopefully sell to more customers, so they need to advertise to as many people as possible. Part of their advertising budget is an affiliate program. As an affiliate marketer, content is created to promote products/services and when someone makes a purchase the affiliate marketer is paid a commission.
Affiliate marketing is one of the most popular ways to make money online. However, not all affiliate programs are created equal. Choosing the right program is crucial for achieving success and creating a steady stream of passive income. There are three general categories – physical, digital, and software and services.
Physical Products
Physical products are the most traditional form of products to promote and how most affiliates start. Physical products work well for niche markets — for example, health enthusiasts interested in using natural supplements or content creators interested in cameras or electronics. Amazon is the most popular affiliate program, but commissions on physical products are usually low – between 1 to 10%. If promoting physical products, look for higher-priced items like cameras, electronics, or furniture. When promoting physical products an affiliate marketer relies on a high volume of sales.
Digital Products
Digital products are anything downloadable, like eBooks, music, videos, or software tools. Some digital products have monthly subscriptions, which pay commissions for years. Digital products also offer upsells with high conversion rates. Digital products also allow affiliates to create products they can promote – owning the whole process. The commission rate is typically 25 – 50%. Between the higher commission rate and potential to pay commissions for years, digital products offer a passive income stream compared to physical products.
Software Products
Software products can be downloaded or accessed over the internet. Examples include productivity tools, graphic design software, and even smartphone apps. They have a high-probable customer retention rate because software companies frequently release updates, new versions, and have complementary products. By promoting software products, affiliates earn a commission through both initial purchases and recurring monthly subscriptions.
TOP TIP: Look for products/services that have the combination of high commission rate (more than 25%) and is a subscription.
Service Products
Service products like consulting, coaching, or web development services are delivered remotely. Service products are beneficial for niche markets with a demand for customized services, have a high conversion rate, and offer upsells. Service products have attractive commission rates, as high as 50%. This commission rate is one of the reasons why I recommend promoting high-ticket affiliate marketing products like Jonathan Montoya’s 72-hour challenge.
In Closing
Affiliates should also promote products they have experience with or can verify their quality. Two places to look for reviews are Amazon and Trust Pilot. Promoting a product an affiliate has used increases the type of content that can be created to promote that product – review, how-to, and comparison posts. As an affiliate’s business grows it becomes a mix of one-time and recurring commissions, also known as passive income. By selecting the right products to promote affiliates can establish themselves as a subject matter expert in an industry, earn trust from potential customers, and quickly build an online presence. With more experience, affiliates create their own products to promote owning the process and thereby increase their passive income.
When selecting a product/service to promote, affiliates need to consider the commission rate, if upsell or complementary products are available, or if there is a recurring monthly subscription. By choosing the right products to promote and focusing on their audience’s needs, affiliates establish a lucrative long-term career in affiliate marketing.
