How I Started Making $20,000/month (A True Story)
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What's with the big words?
Somebody forgot what account they were logged in with.
My first online failure started off with an adult toy site purchased off ebay for $200 and ended with threatening emails from the russian mob operating out of london.
Made a grand total of -$245 on that venture.
True story.
Want the ebook?
success on affiliate market is not the same, for each of us it is different
all you need only – to work harder
all you need only – to work harder
me thinks he's the dropshipper...
regardless, there's one important difference between affiliate marketing and e-commerce. Namely, CUSTOMER SERVICE.
The instant you take a credit card number from a customer, you have to provide status updates, tracking info, handle returns, issue credits, charge cards... you see where I'm going here.
Affiliate marketers don't have to do any of the above. So, remember, unless you enjoy talking to people on the phone about their defective fleshlight, stick with AM.
regardless, there's one important difference between affiliate marketing and e-commerce. Namely, CUSTOMER SERVICE.
The instant you take a credit card number from a customer, you have to provide status updates, tracking info, handle returns, issue credits, charge cards... you see where I'm going here.
Affiliate marketers don't have to do any of the above. So, remember, unless you enjoy talking to people on the phone about their defective fleshlight, stick with AM.
What Jeff said is one of the biggest reasons people stick to affiliate marketing, misconceptions about the amount of work required to run an e-commerce business. It is true that there are additional things you need to do with e-commerce that you don't with affiliate products. But its worth it. Find a good dropshipper, and no i'm not the dropshipper, nor am I saying that the one I use is the only good one. Just find a dropshipper that is reliable, that handles customer service for you, and you won't find yourself spending any significant amount of time dealing with the bullshit. I spend a few hours a week dealing with customer related issues, 90% of my time is spent marketing and improving my business.
I'm not saying abandon affiliate marketing, it can be very lucrative if you are good at it, what I am saying is there are distinct advantages to e-commerce. Like the following, (and these apply to any e-commerce store, not just adult toys )
1. The ability to adjust your own pricing. WIth affiliate programs, you sell the product at a set price, your margins are determined by how much you spend on advertising.
2. The margins on e-commerce are usually much better. Affiliate commissions have a huge range, but for the most part pay-per-sale affiliate programs range from 5% at the low end to 30% at the higher end. With e-commerce, you set your prices. I mark up everything 100% at least, some products much much more. So e-commerce margins are almost entirely under your control, you determine how much you sell your products for, and how much you spend marketing them.
3. Competition in affiliate marketing is huge. Sure there is a lot of competition in e-commerce as well, but not to the degree you see with AM. Think about it, Jeff5311's sentiment is exactly why this is the case. AM has an incredibly low barrier to entry, which is why there are so many people doing it, and increasingly more newcomers. Most have the misconception that starting and running an e-commerce business is somehow too hard, or too much work, or not worth the extra effort, thus there are fewer people who try it.
4. Ecommerce is a better long term strategy. Even if you have a wildly successful affiliate promotion going, sooner or later its probably going to die. It has happened so many times before. People will make good money for a while, then it becomes saturated by other affiliate marketers, or the demand drops out, or their special trick stops working, and poof, there goes the money. You can see great success with AM, but its a fight to stay on top, and in the end, you usually dont have an inherently valuable product or web property. While this is not entirely true for all Affilliate marketers (there are some who build sustainale web properties that sell affiliate products) , i'd venture to say many are not doing this. With e-commerce, the entire idea is about building a business, a long term business, one that you can eventually sell.
5. Restrictions. Owning your own e-commerce site gives you complete control. You do not have to abide by affiliate guidlines, you are free to market the site in any way you see fit, including blackhat methods if that suits you, without fear of being kicked out of a lucrative program.
6. With an e-commerce store, you could actually start your own affiliate program. Who do you think makes more money, the affiliate, or the company who started the affiliate program? If you own an e-commerce store, set up an affiliate program and offer higher margins than most others in your niche. You have very little to lose, at the very least your affiliate marketers will build links and publicity for you, and if they make some sales.. more money for you.
7. Owning an e-commerce store does not exlude you from still using affiliate marketing to your advantage. its not as if one precludes the other. It's just one more way to make money. You can even offer affiate products alonside your own products, using i affiliate products as a way to expand your offering.
8. Risk. I'd be interested to see in a poll how many people have not recieved affiliate commissions they deserved, and how much over the years they would estimate they have lost. How many programs have you made $40, but never got that last $10 so they would actually send you a check... With E-commerce, when a customer buys a product, the money goes into your account, you dont have to wait weeks, and you dont have to wonder if you will ever see your money.
I realize this post was centered towards e-commerce over AM, so if you have experience with both, I'd love to hear others take on it. I hope people don't think I'm somehow bashing affiliate marketing. It is a great way to make money online. I've always done some AM, and I'll continue to. The point of this was that writing off E-commerce because of a lack of knowledge about its pro's and con's is a mistake.
I'm not saying abandon affiliate marketing, it can be very lucrative if you are good at it, what I am saying is there are distinct advantages to e-commerce. Like the following, (and these apply to any e-commerce store, not just adult toys )
1. The ability to adjust your own pricing. WIth affiliate programs, you sell the product at a set price, your margins are determined by how much you spend on advertising.
2. The margins on e-commerce are usually much better. Affiliate commissions have a huge range, but for the most part pay-per-sale affiliate programs range from 5% at the low end to 30% at the higher end. With e-commerce, you set your prices. I mark up everything 100% at least, some products much much more. So e-commerce margins are almost entirely under your control, you determine how much you sell your products for, and how much you spend marketing them.
3. Competition in affiliate marketing is huge. Sure there is a lot of competition in e-commerce as well, but not to the degree you see with AM. Think about it, Jeff5311's sentiment is exactly why this is the case. AM has an incredibly low barrier to entry, which is why there are so many people doing it, and increasingly more newcomers. Most have the misconception that starting and running an e-commerce business is somehow too hard, or too much work, or not worth the extra effort, thus there are fewer people who try it.
4. Ecommerce is a better long term strategy. Even if you have a wildly successful affiliate promotion going, sooner or later its probably going to die. It has happened so many times before. People will make good money for a while, then it becomes saturated by other affiliate marketers, or the demand drops out, or their special trick stops working, and poof, there goes the money. You can see great success with AM, but its a fight to stay on top, and in the end, you usually dont have an inherently valuable product or web property. While this is not entirely true for all Affilliate marketers (there are some who build sustainale web properties that sell affiliate products) , i'd venture to say many are not doing this. With e-commerce, the entire idea is about building a business, a long term business, one that you can eventually sell.
5. Restrictions. Owning your own e-commerce site gives you complete control. You do not have to abide by affiliate guidlines, you are free to market the site in any way you see fit, including blackhat methods if that suits you, without fear of being kicked out of a lucrative program.
6. With an e-commerce store, you could actually start your own affiliate program. Who do you think makes more money, the affiliate, or the company who started the affiliate program? If you own an e-commerce store, set up an affiliate program and offer higher margins than most others in your niche. You have very little to lose, at the very least your affiliate marketers will build links and publicity for you, and if they make some sales.. more money for you.
7. Owning an e-commerce store does not exlude you from still using affiliate marketing to your advantage. its not as if one precludes the other. It's just one more way to make money. You can even offer affiate products alonside your own products, using i affiliate products as a way to expand your offering.
8. Risk. I'd be interested to see in a poll how many people have not recieved affiliate commissions they deserved, and how much over the years they would estimate they have lost. How many programs have you made $40, but never got that last $10 so they would actually send you a check... With E-commerce, when a customer buys a product, the money goes into your account, you dont have to wait weeks, and you dont have to wonder if you will ever see your money.
I realize this post was centered towards e-commerce over AM, so if you have experience with both, I'd love to hear others take on it. I hope people don't think I'm somehow bashing affiliate marketing. It is a great way to make money online. I've always done some AM, and I'll continue to. The point of this was that writing off E-commerce because of a lack of knowledge about its pro's and con's is a mistake.
volt... couldn't read all of your post -- too long.
i'm not knocking e-commerce (i have 2 e-comm stores in the same niche). i just wanted affiliate marketers to be aware of the additional hurdles when starting.
how in the world would your drop-shippers handle returns, refunds, etc... for you? the process is as follows.
1) customer wants to return something and contacts you
2) you tell the drop shipper to issue call tag / RMA for the return
3) customer then receives return labels
4) once the return is received by the drop shipper, they notify you of the credit
5) you issue a credit back to the customer's card.
ok... this is not a biggie, and pretty easy to follow... BUT, if you're doing volume (let's say 100 fleshlights a day), and you have a 2% return rate, there's a decent amount of customer service involved -- just for returns.
let's not even begin to talk about chargebacks.
i'm not knocking e-commerce (i have 2 e-comm stores in the same niche). i just wanted affiliate marketers to be aware of the additional hurdles when starting.
how in the world would your drop-shippers handle returns, refunds, etc... for you? the process is as follows.
1) customer wants to return something and contacts you
2) you tell the drop shipper to issue call tag / RMA for the return
3) customer then receives return labels
4) once the return is received by the drop shipper, they notify you of the credit
5) you issue a credit back to the customer's card.
ok... this is not a biggie, and pretty easy to follow... BUT, if you're doing volume (let's say 100 fleshlights a day), and you have a 2% return rate, there's a decent amount of customer service involved -- just for returns.
let's not even begin to talk about chargebacks.
It was a well-written post, worth reading by my estimation. His arguments make sense.
Drop-shipping as a business is something that I've been putting serious thought into for a few months and many of the points that voltier makes echo the very reasons why I've been considering it so much.
If you read Diorex' blog (and you should) you may remember a post that he made a few months back where he addressed drop-shipping as possibly a much more viable alternative to "traditional" affiliate marketing.
Diorex Blog Archive The best Niche to be in…
That being said, I do believe that voltier came here with the intention of profiting off of making that post in one way or another (most likely how everyone has already suspected) but that shouldn't take away from the idea as a whole.
If you read Diorex' blog (and you should) you may remember a post that he made a few months back where he addressed drop-shipping as possibly a much more viable alternative to "traditional" affiliate marketing.
Diorex Blog Archive The best Niche to be in…
That being said, I do believe that voltier came here with the intention of profiting off of making that post in one way or another (most likely how everyone has already suspected) but that shouldn't take away from the idea as a whole.
The thing is based upon what your priorities or values are in life morals can have different connotation.
sure... you can outsource customer service, or hire. same with data entry of new products, accounting, and all rote / rudimentary tasks.
e-comm is viable and there are many niches untapped. it's also a bit more defensible once SEO kicks in.
however, in e-comm you can't generate 10,000 sales a day in without a team behind you. just look at the staff of any large ecomm. / dropship operation (amazon, buy.com -- yes, both dropshippers).
they have more margin, hence their affiliate programs. but IMHO the business model doesn't scale as easily as traditional affiliate marketing. just my $0.02.
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