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Internet ROI |
How to make Profit and get Return - on - Investment from the Internet |
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Explanation and Overview
Rather than struggle with the overheads of owning and running a store, an easier route is becoming an affiliate, where a web store is the appearance but the orders are dispatched from elsewhere. Thus the actual store takes the pain of stock control, delivery, returns, staff, etc. whilst the affiliate just directs people to the store and collects a commission for each sale. The commission rates can be suprisingly generous. With good site traffic to your site, having affiliations is an effective way of achieving ROI and profiting from the web. Most of the email we get which has embedded pictures of clothing, jewellry, Electronics and more are from affiliations (this level is called super affiliates).Once investigations are made into the world of affiliations, stories abound about fortunes being made through variations of this scheme. As with all web activities, there are incredible successes but as the web has matured this gets more and more difficult. However, a consequence of the web growing is that expanding and new stores need sales. Website owners of offline counterparts are often inexperienced with site design and optimization, so have little traffic, even for good products or services. For web developers who are adept at skills in cyberspace there are indeed profitable opportunities to be ethically exploited.
Affiliates can be found by simply visiting sites and searching for an affiliate scheme on the site. If it can't be found fairly easily, move on to the next site - the site needs to be committed to the idea and has to have thought about attracting external affiliations.
There are also agencies established which match (or broker) companies and affiliates, and ensure that click-throughs are acurately tracked. Examples of these are: AffiliatesDirectory.com, CJ.com (cj = CommissionJunction) and many others.
What to look for
For the scheme to work the retailer must have a means of effectively tracking clicks that come through to their site. They should have an organized affiliation system in place, which many do indeed have. If a site has poor photography of products and a generally poor appearance,leave it and look for another affiliation. You are the salesperson. Bringing people to the doors of the store is a waste of time if they cannot then convert the sale becasue of a shoddy site. Further, if the effort of bringing the visitor the the actual store results only in a brochure request, your commission is, in most cases, lost. This is usually true where the product is fairly expensive and the site photography is poor, not giving a good idea of the quality and value. The effective affiliations are those that need no human interaction to result in a sale.
Look for the more generous commission schemes. Many competing sites vary greatly in commission structure - one offers 5%, another offers 20% for similar products.
When analyzing opportunities of this nature and looking over the material below, ask yourself: Would I buy this product or service when the 'need' or 'want' arose? Would I buy it from this retailer?
Scheme Types
Affiliate schemes come in several flavors as described below. The most common is for visitors to your site being directed through some hyperlink to another site. The receiving site tracks the means through which the visit arrived, and if the visitor buys something, you get commission.Commission, Click-throughs, Bounty
Commission: For everything bought by a visitor, the affiliate gets commission. Most retailers allow a period for the visitor to return to the site and will still grant commission. If they don't, move on to another. It's rare that a buyer buys when first seeing the product - they'll think about it and return later. Retailers achieve this by setting a cookie on the visitors machine which has a time on it. Some retailers even allow this grace period for life. If ever the visitor buys something, you'll get commission if the original click-through was from your site. This bites both ways of course. If a prior visit was from another site, the other site gets priority.
Click-Through: Some schemes are for any click-throughs from your site whether the visitor actually buys anything or not - the most prominent example of which is 'Google Ad Words'. Every time a visitor clicks on a text advert, you get 5c or so (depending on the price for that classification of ad by Google).
Bounty: Similar to commission - the site gets a lump sum if a visitor from your site signs up for something, a subscription, a service, etc. This is often the case with mortgages and credit cards. If the site has good traffic and is similarly themed, this is often an excellent source of profit. Automatic Affiliation SChemes
The most efficient schemes in affiliation are with those companies that have an automated tracking scheme set up. This means that clicks are efficiently tracked and recorded, with analytics for you to view and analyze. At any time you canlog in and see how many visitors came through your site and howmany converted to sales. The feeling of confidence in these schemes is strong - there is little chance of missed revenue potential through missed click-throughs.
Drop Shiping
This is for when the retailer has no schemes set up as above but wishes to have affiliates. There wold usually be some good reason why an organized system is not established, or it could be in process. Therefore you provide everything about the product, all photography (usually from the retailer site) and actually receive the order. Then the order is provided to the retailer and the commission paid on clearance of funds. This type is really only feasible for larger value items, a call will often be required and some order tracking, etc. Automatic Product Feeds
When a retailer comes to depend on sales from external affiliates, they start to build their business around it, which further serves for profitability for both parties. Since product pricing, stock, specification, etc. changes continually, if the affiliate website can just have products that are dynamicaly created from script, then the pricing will always be correct and availability will be accurate. The scripts could even list special offers and sales for the retailer. This is exactly the case with a growing amount of retailers depending on external affiliations for their revenue. The prime example: Amazon. With many thousands of affiliates, an array of scripts are available which dynamically display products on affiliate sites. This is an excellent way to get return on investment for sites, especially sites with good traffic. Also, if the company has taken the pain to create scripts for their external affiliates, they will also have a sophisticated system in place to track visitors and from which site they have come, therefore which affiliates have earned the commission.
The downsides of this type of program is that there are clearly many people doing the same thing, so visitors have a huge array of possibilities to choose from in purchasing the products which are dynamic to your site. A further downside is that there is normally some requirement for slight web development skills to implement the dynamic script.
Summary
Affiliations offer some of the best opportunities for profit and return-on-investment available. The opportunities only increase as the web sprawls, since e-Companies need sales. For web developers who know how to optimize sites for good search engine retrievals and are skilled in getting traffic to their sites, affiliations are probably already a part of their arsenal for ROI. Optimization skills can be cultivated, many books are available about the subject along with much web resource at ones disposal.Look for companies that are generous with commission in comparison with their competitors. LOok for companies that have an automated affiliate scheme in place - usually using third party software to gather the click-through data from external sites. Consider organized affiliate brokers who manage relationships between company and affiliate. Look for products and services that represents purchases which you yourself would make if the 'need' or 'want' arose. Then choose retailers whose sites give some confidence for visitors who you direct to in your efforts to gain ethical profit.
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