"I don't have a product. I don't even have a product IDEA!"
This is one of the most common concerns I hear from people
interested in starting a business on the Internet. It's obvious
that you need to sell either a product or a service in order to
make money.
That's where affiliate programs come in. Many beginners start
online by joining affiliate programs; you sell another company's
product or service for a commission. Affiliate programs are
available in practically every market you can think of. If you
want to see what I mean, visit
http://www.associate-it.com/ to
view an extensive list of affiliate programs.
Affiliate programs are a convenient way for people to get a
'jump-start' online without the time, effort, and money
necessary to create a product of their own. However, they're not
a 'perfect' solution. Here's a list of the positives and
negatives to building an affiliate business...
Negatives to affiliate programs:
- You have to share the profits. You earn a commission, which
typically ranges from a measly 5% to a generous 50%. The rest of
the money goes into the company's pockets.
- You pay all marketing costs. The company is providing you
with a product or service to sell; it's your job to actually
make the sales. This is no easy task, unless you're a
natural-born marketer! You can choose to use only free methods
of advertising... but these methods aren't necessarily the most
effective. Marketing can get expensive -- and you pay for your
own marketing, regardless of whether or not it results in any
sales.
- You can get 'sidelined.' Building an affiliate business is
hard work; if you intend to eventually market a product of your
own, you may find that the affiliate program is taking up too
much of your time.
- You're at the mercy of the company. You rely on them to pay
you on time - or at all. If they decide to change commission
rates (usually to lower them!), you typically have no say,
except to cancel your affiliate contract. And finally, if the
affiliate program decides to close shop - well, you're simply
out of luck.
Positives to affiliate programs:
+ You're free to concentrate on just one thing: marketing. The
affiliate company handles everything else - billing, inventory,
delivery, customer service, and all the other stuff that goes
with the territory. This is one reason why affiliate programs
are so popular; they give you the opportunity learn how to
market online without being overwhelmed by everything else.
+ Startup costs are lower than if you had your own product.
There are numerous costs associated with the research,
development, and delivery of your own product. When you run an
affiliate business, the only thing you're responsible for is
marketing - and you have the option of using free methods only.
+ You get a 'head-start' while researching product ideas.
Affiliate programs allow you to sell a product or service while
you're still trying to come up with a product of your own.
That's not to say that they're an 'easy' way to riches - they're
not - but you can learn how to market while earning an income.
+ Multiple streams of income. A bunch of 'smaller' pay cheques
can really add up! It's even better if you already have your own
product or service and just want to use affiliate programs to
add another stream of income.
Many people from all walks of life make hundreds or even
thousands of dollars every month through affiliate programs
alone. Affiliate programs aren't perfect, but they provide a
great option for those who are willing and able to put in the
necessary time and effort.
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