Affiliate Marketing – Advantages and Disadvantages

Last Updated
July 20, 2010

What Types of Advert Does Affiliate Marketing Cover

Banner Ads (Images) – Standard banner adverts are used by most affiliates; they are usually provided by the company in a range of sizes to help you promote them. Larger companies sometimes produce a range of images to help you find one that attracts your audience.

Text Ads – This is simply a piece of advertising text that links to the company; this could be positioned in an ad space or as part of your content.

Shopping Links – These are links (usually a combination of text and images) that show prices of particular objects on a site. These are usually used by ‘price comparison’ sites such as Kelkoo, much of Amazon’s affiliate links are done in a similar way; with the image of a book, and its title and price in text.

How Can Affiliate Marketing Benefit Your Business?

Simplicity – Running affiliate ads allows you to get advertising income much more easily than by running traditional advertising; where you would have to spend a huge amount of effort sourcing advertisers (with a budget!), convincing them to advertise (not easy), and then organising the campaigns.

Less Time Consuming – Although running a good affiliate campaign can take up time, it certainly takes a lot less time than you would need to organise and run a traditional advertising campaign. Although payment can take time for both traditional advertising and affiliate campaigns; both direct and network affiliates are likely to pay you more promptly as they want you to keep promoting their company!

Direct Affiliates – Helps Build a Working Relationship – If you are working directly with your affiliate, it is a good first step to building a working relationship. Over time this could help you get increased commissions, and could lead to them wanting more traditional ads (which will be more profitable for you) to ensure visibility on your site.

Network Affiliates – No Need to Actively Source Companies – The big advantage of network affiliates is that the process of signing up is very simple. Rather than needing to source each affiliate yourself and make an agreement with them; once you are registered with the network you can apply to register with each affiliate company that works with them in just a few minutes.

Network Affiliates – Big Names – By going through an affiliate network you are more likely to be accepted into the affiliate campaigns of big companies; this means your visitors will see recognised brands that they are more likely to click on. Selling normal ad space to big companies would be extremely difficult for a site run by a small business.

What are the Downsides to Affiliate Marketing ?

Uncertainty – As affiliate ads pay out on results, you do not have any guarantees that you will make m oney. You may have to try a number of different affiliates to find those that your visitors respond to. Remember th at you should h ave a good idea of the profile of people that visit your site to ensure you target them appropriately. Waiting for Payment – The time from putting the ad up to getting your payment can be several months depending on the affiliate scheme or network you register with. It may take a month to get a few sales in; payment then usually follows within 60 days of the end of the month; although all schemes will vary. However, getting paid with normal site advertising can take just as long! Profitability – Affiliate marketing can be very rewarding if it works well; but it is rarely as profitable as running normal advertising space. However, it is important to remember that affiliate income is much easier (both in terms of time and effort) to get than advertising income; and sites without thousands of visits a day will struggle to sell advertising to well known companies unless extremely well targeted. Direct Affiliates – Can be Time Consuming – The process of arranging direct affiliate campaigns can take a lot of time and effort. Many schemes are designed to be as easy as possible; but you still have to go and source them and arrange them individually. Requires Traffic – As you are paid on results, you need to have a steady stream of visitors to make any significant money from affiliate schemes. If your site is only visited by a few customers a day, you are unlikely to achieve many sales.

Alternatives to Affiliate Marketing

There are several alternatives to affiliate marketing, the suitability of which will depend on the type of site you run and the number of visitors you get.
Search Engine Links (e.g. Google AdSense) – These are How Can Your Business Benefit from Search Engine Advertising? boxes that you place on your site; you get paid a percentage of the cost that the advertiser pays the search engine company per click made.
The results that are displayed are usually based on the content of your site (e.g. If your site is about sports then the boxes will display sports ads).The amount each click makes will depend on what the search term is (Costs vary from a few pence to well over £10 per click). Text Linking – This works on a similar basis to the search engine links, except that instead of an ad box links are added to text in your pages. e.g. The most popular sport in the country is football. With some text linking companies, highlighting the links will bring up an overlaid box which details the site the link will go to.

Article Index

  1. How Can You Take Advantage of Affiliate Marketing?
  2. Affiliate Marketing – Advantages and Disadvantages
  3. How to Get Started - Making Money With Affiliate Marketing
  4. Promoting Your Business With Affiliate Marketing
  5. Promoting With Affiliate Marketing - Advantages and Disadvantages
  6. How to Get Started - Promoting With Affiliate Marketing
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