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The Pros and Cons of Earning Money With
Affiliate Programs
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"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 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, 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. Best thing
to do is to find a free affiliate program and find out more about the
company. Discussion Boards are great to find out more.
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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