When I started blogging four years ago, I ventured into affiliate marketing without knowing what it was truly about. I saw blogs with ads and read how bloggers were making money and I thought I want to do that too, so I did.
The problem with that was I started backwards and that was a big mistake. By that I mean I was focused on placing ads and promoting products before building my community and getting to know who came by my blog and what they needed.
After a year and a half of wasted ad space and time, I finally got the hang of affiliate marketing and now I want to share what I’ve learned so far with you.
I’ll be writing a series of posts about affiliate marketing. I’m not claiming to be a guru in this subject but I know the hard lessons and experience I’ve had will surely help you avoid the mistakes I made.
Understanding How Affiliates Get Paid
Back in March I shared four important questions to ask yourself when choosing an affiliate network. Today’s post is going to help you understand how affiliates get paid.
I know of three and they are pay-per-lead, pay-per-sale, and click-through-rate. Here’s a quick breakdown of what they mean.
In this program, affiliates are paid, provided the action is within the guidelines of the affiliate agreement, when a customer completes a certain action like completing a sign-up form for a newsletter, for a product trial offer or other action chosen by the advertiser.
In a pay-per-sale program, the affiliate is paid when a customer follows an affiliate link and makes a purchase. Although there is a potential to earn a high commission, this program usually has the lowest conversion rate.
Perhaps the easiest way to earn money as an affiliate is when you’re paid by CTR or click-through rate.
Dictionary.com defines click-through rate as the following:
- a percentage used to measure the effectiveness of an advertisement or other link on a Web page, obtained by dividing the number of clicks on the link by the number of times the link was viewed:
a successful ad with a click-through of one percent.
The click-through rate is calculated by taking the number of clicks on any link or banner placed on your website divided by the total number of page views on your site, multiplied by 100.
For example: You had 500 clicks from a banner ad, your total page views was 15,000. It would look like this: 500/15000 = 0.033 x 100 = 3.333. Your estimated earnings would be $3.34. Still, be sure to read the terms and conditions of the affiliate network you sign up with for their pay conditions.
While that doesn’t sound like a lot, if you approach affiliate marketing the right way, you can make money over time, not overnight, like some folks out there are preaching.
What It Comes Down To Is This
To rake in some serious money your site has to have some serious traffic and to do that your content should be consistent, fresh and original. More importantly and the first thing to focus on is building your community and engage with your visitors.
You don’t want to place ads or promote products on your site before getting to know your visitors and them not knowing who you are and what you’re all about. Just imagine the salesperson at your door bugging to you buy something you don’t need.
You have to make sure the ads you place and products you promote are relevant to your readers and to your niche. It’s tempting to fill your pages with all kinds of ads. I can definitely understand, after all, your goal is to make money. But a couple things can happen with that.
- Your readers can become overwhelmed with the ads and blog post for products they don’t have a need for, so they leave, and never return. For example, if you have a fashion blog and you have ads placed for computer software the chances of your visitor clicking on that ad are low.
- Depending on the type of ad (video or moving graphics), it can slow down your site’s load time and as you know that’s a hot topic right now.
Learn From The Experts
I didn’t learn about affiliate marketing on my own. I followed great bloggers who took the time to share their experiences and showed their readers the ins and outs of affiliate marketing.
You might remember I interviewed Donna Merrill this year and she shared some great blogging advice with us. She recently launched Donna Merrill Buzz offering great interviews with top bloggers who share their secrets to success.
If you’re ready to get into affiliate blogging, check out this interview with Leslie Federici co-founder of Power Affiliate Club. This is a great resource for anyone who is new to affiliate marketing.
I hope this post helped clarify any questions you had about how affiliates get paid. If you have any other questions about affiliate marketing or would like me to write about something in particular regarding this topic, feel free to leave them in the comments section below.
[tweetthis]Are you new to #affiliatemarketing? Understand how #affiliates get paid >[/tweetthis]