Affiliate Marketing – the next best thing to a passive income
If you like the thought of making passive income without doing too much work, you need to know about affiliate marketing.
There are two ways to approach this technique:
- if you have a list of subscribers, you can sell someone else’s product and make a commission;
- you can offer one of your own products to others who have databases of subscribers who might want what you have to offer.
It’s a win-win for both parties, but generally the one with the list calls the shots. It’s important to mention too that you must only align with products that match your brand and reflect your values. Your customers will just assume you endorse this product so take care and do your due diligence when choosing your affiliate partners.
How it works
Here’s a quick example of how it works:
Sally is a naturopath who consults to women who are gluten-intolerant, and has 10,000 clients on her list, while Paul is the author of the ebook ‘Australia’s Top 100 Gluten-free Restaurants’.
Sally’s customers would almost certainly love to hear about restaurants catering to people with gluten intolerance, and Paul would definitely like to sell his ebook to Sally’s clients.
So Paul approaches Sally and tell her, ‘I have an ebook that usually sells for $30. If you send out an email to your database promoting my book and your customers buy it, I’ll give you 50% of the recommended retail price – that’s $15 a book just for sending out an email. And to make it easier, I’ll write the email text for you and give a link for people to visit if they want to find out more about the book. That way we can track who bought it.’
‘Affiliate Marketing is a brilliant way to make money without actually doing much work. Compared to how hard it can be to make passive income, it is a pretty good model.’
For Sally, it’s a no-brainer. All she need do is send out the email with Paul’s link in it (tracking the sales), then Paul pays her for whatever sales result.
Sally could have approached Paul with the same offer. It doesn’t matter who starts the conversation. What is important is that everyone agrees on the commission split.
If the product is a digital download, then the cost of delivering it is close to zero, so it is easy for Paul to offer Sally 50% because his margins are so good.
It won’t cost you
If you don’t have a database but need one, try using affiliate marketing as a way to grow it. It won’t cost you, it gets your name out to a whole range of new people and it helps your partners make money. What’s not to like about that?
Alternatively, if you have a big list of engaged subscribers who trust you, look for a complementary product they would buy so you can refer it to them.
Affiliate Marketing is a brilliant way to make money without actually doing much work. Is it passive income? No, but compared to how hard it can be to make passive income, it is a pretty good model.
3 top tips:
- It has to be fair to both, or it won’t work
- Pay commissions when the program is finished, not before
- Choose your partners wisely – you have to believe in their product as much as your own
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