The ups and downs of affiliate marketing

Wednesday, May 6th, 2009 at 8:23 am

A lot of people ask a question what exactly “Down Side” to Affiliate Programs is?

Actually there are couple of “down side” points to make about affiliate marketing. The first thing to be mention about is that payments for credited referral sales (earned commissions) are usually not paid right away and there are some positive reasons for this practice by those running affiliate programs.

You might know that when a sale is made at a website, the purchaser usually has a money-back guarantee period of time (usually 30 days) to use and evaluate the product and to make sure the chosen product meets the user’s needs.

In the case that the buyer requests a refund of the purchase, then the affiliate also loses their commission for the sale. Here it should be added that payments to the affiliate are usually delayed until after the refund period has expired, it simply means the product owner is not “left holding the bag” for already paying a commission on a sale that has now been refunded.

Usually commissions are paid on a regular payment cycle, normally monthly. What you earn in one payment cycle is usually not paid until the next payment cycle for that reason in this way all commission payments can be done at one time and, as you understand it is not a full time job that must be paid daily, weekly or monthly.

You should know that the main “down side” to affiliate marketing is that most affiliate programs set a minimum dollar amount you must reach in commissions before they will cut you a payment. Usually, this ranges from $20 – $50.

For your better understanding let’s have an example. Imagine you sign up for an affiliate program that has a $30 minimum payout level and the product sells for $49 with a 50% commission.

You do all of your work and generate a sale from your affiliate link. So, you have made a $24.50 commission and then you get that paid to you on the next payment cycle, right? Actually, not exactly. This is because your commission does not reach the $30 minimum payout the program sets before they will incur the expense of cutting you a payment.That is why you have to wait until you make another sale in order to get you over the minimum before you get your commission on the first sale.

As concerning the minimum payout level it applies to each individual product for which you are an affiliate. It means that different people own different products and the earned commissions for all products don’t accumulate to get you over any minimum payout level. As a matter of fact, there is no need to worry about it for that reason that minimum payout level problem is solved when using affiliate sites instead of individual affiliate programs.

You can be sure that each sale you make with the help of the affiliate site is accumulated into one qualifying pool that means that you only have to make cumulative commissions in order to meet the minimum payout level to get paid.The other question concerning affiliate marketing that is often asked is how to get your affiliate link online.

The most pleasant thing about affiliate marketing is that you are not trying to convince anyone of anything, so, you are not like a salesman in the real world. You just register a domain and put up a product review minisite, a one page website that describes and promotes all the features and benefits of the product being promoted.

Although a product review site is recommended in order to achieve the better results, it does require that you do have some web space on the Internet. Just a few dollars a month and you will get your hosting accounts. There can be a lot of review sites on one hosting account

There are also alternatives if you do not want to create product review sites. The point is that there are such affiliate sites that offer you pre-made products and websites and if you join their affiliate program you can use them for free.

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