Can Affiliate Media Buying Be A Sustainable Business Model? (14)
Hello good people,
I've had some success with a few different business models online. Nothing major yet.
I've realized my favorite thing is promoting affiliate offers through paid ads.
So now I am here. To learn, get involved, and help others if I can.
I want to open up with a question for you more seasoned online earners out there:
Can solely promoting offers through paid ads be a sustainable business model?
Is anyone solely just doing this for long periods of time? I would love to have this be my focus, but I am concerned about not building assets like an authority site, email list, products, brand, etc. And there is no backend, which I know is the prime profit center for many businesses. There is a lot of power in being able to lose money upfront because you will make it back on the backend. But this business model wouldn't allow for that. Are people creating a long term business just from frontend profits? Or do most move their profits into their own product or agency down the line?
I would love to hear what you think on this...
-Kyle
In the first 3 years or so I even only worked with free traffic before I started with paid traffic in 2008.
It really depends on whether you want to have an asset to sell in the end. And if you do, there are ways.
1)For example you can put together a team of people to run paid traffic campaigns on a bigger scale. This can become an asset you'll be able to sell, especially if you have detailed processes in place that are documented. Stuff such as hiring specs (qualifications / requirements for each position), detailed training materials for each position, a complete system on how to decide which offers to run and how to set up campaigns and how to optimize campaigns...etc. etc.
If you have proven methodologies built into your system and company processes, that will allow your team to pump out profits consistently like a well-maintained engine, then you can definitely sell that off as an asset later on. Your company's relationships with various affiliate and traffic networks will be a valuable part of the asset as well. (Think: Higher payouts, dedicated account manager, exclusive offers and traffic, etc.)
2)And/or, you can also be an ad agency that helps run other people's campaigns. Once you have that clientele you'll understand their other online needs, so you may expand your range of services to serve them better. This is where you can build your mailing lists (of past / current / potential clients) and backend (i.e. those other services you can expand to include such as website creation and content creation and SEO etc.)
3)And of course you can provide a service that is different from the ad agency model. In fact it could be any service that can be marketed online, not necessarily marketing or advertising related.
4)Selling physical and/or digital products would be yet another option, and these don't necessarily even be products you've created or own yourself. You can do dropshipping or run affiliate offers WHILE building a list and selling related products and services on the backend - as long as you have a TARGETED audience. So you'll need to think about audience targeting and decide which types of traffic to run that will give you that.
Hope I've provided some food for thought!
Amy
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Wow awesome replies thanks! I owe you both some beers. I hope to help other noobs one day like you do.
I love this stuff - finding offers, developing creatives, writing headlines and copy, testing and optimizing, learning new platforms and offers - good to know theres options to make this more sustainable.
I really appreciate how you broke everything down too Amy - definitely gives me direction. Cheers!
Originally Posted by kweston
As for helping other newbies - I'm sure you have you can start doing that even now!
No matter your level of experience, there'll always be something you know that certain other people don't.Something else I'd like to point out, is that no matter what business you choose to run in the future, learning online marketing will almost always be a good idea.
So you're definitely already on the right track by running campaigns! It's just a matter of fine-tuning your goals and direction.
Amy
Been running paid ads as my main business since 2013, I think. Prior to that, I used to run websites and focus on organic traffic.
There are pros and cons to either model. With organic traffic and an actual websites or an app, you are actually building something that can last for a long time, the problem is that you're relying on sources like google to show you some love with their organic traffic. When working with paid traffic, you can buy whatever traffic you want, whenever you want. On the other hand, the traffic comes at a price and you have to optimize your operation closely, in order to turn profit. Paid traffic also works MUCH faster than organic, so I kinda decided to stick with it for the time being.
The best setup, IMO, would be to build some kind of a product/service that you would own and kickstart it with paid traffic. So basically killing two birds with one stone
Vortex gave you some great ideas in her first reply already as well. Affiliate marketing is pretty diverse, there are so many paths you can take
Originally Posted by matuloo
The best setup, IMO, would be to build some kind of a product/service that you would own and kickstart it with paid traffic. So basically killing two birds with one stone
Vortex gave you some great ideas in her first reply already as well. Affiliate marketing is pretty diverse, there are so many paths you can take When your LTV isn't one and done, it also really opens up what you can do with paid traffic. No longer do you have to be profitable on the first transaction. In some ways, @jaybot is doing this with Pops and Push subscriptions.
Originally Posted by iwanttofly
I personally think the ultimate goal is to sell diet pills.
I’ll get around to it someday.
So as I see it the pros of owning my own product are:
-focused on one product line
-ability to optimize product itself
-own the customer (increased LTV)
-backend sales (which gives the ability to create loss leaders)
However, the pros can also be the cons for me as I'm stuck with one product, don't have the ability to jump around as much, and managing other aspects of the business I don't like as much.
With affiliate media buying I get:
-work is focused on frontend funnel (which I prefer)
-ability to move to different products and verticals as I choose
-don't have to deal with product management or customer service
But I also don't like leaving the other benefits on the table. I understand the power of owning the whole customer journey and LTV.
I can easily put my efforts into my own product--the question is do I want to?
Originally Posted by kweston
Running simple affiliate marketing campaigns is definitely the more simple approach, at least when it comes to the setup side of things. In very simplified words, you just need some ads, LPs and then drive traffic to them. in reality there much more to it, of course, but you get the idea.
As a product owner, you have to build it first, which can get complicated and there are no guarantees it will work in the first place. Then there is the billing and support part, all the backend monetization processes and whatnot. This is definitely harder to put together, compared to a simple campaign for some offer.
On the other hand, every affiliate campaign dies one day and you have to start again. You can literally go down from making $1000 on one day to making $0 on the next one. Obviously, you can secure yourself by running multiple offers in multiple GEOs, for example... but I'm sure you understand what I'm trying to illustrate.
To put it simple, a great product that you actually own can be much more stable and bigger business asset than simple affiliate campaigns. But it requires more work on you part and it also requires more time and funds. At least in the beginning.
We are all different, so you gotta choose what suits you better
Originally Posted by matuloo
Do I want to be the star quarterback (or even just a player) or do I want to own the whole team?
As far as numbers though, I'm not sure its so cut and dry. I see affiliates making more than product owners all the time...
Originally Posted by kweston
In case of people who own some very specific niche offer, then yes, they likely make less than a seasoned affiliate who knows how to buy traffic in large volumes and promotes multiple offers in huge GEOs. It's really a case by case type of situation, really hard to generalize.
Originally Posted by kweston
You absolutely can do both!
The trick is you need to niche down and define a target audience first.
While promoting affiliate offers, capture the visitor's email to build a mailing list, and/or ask them to join your FB group to build an audience there. I mentioned how to do both here:
https://stmforum.com/forum/showthrea...l=1#post409495
That way, you can sell different affiliate offers/products to the same audience. The first offer you promote doesn't even need to make you profits necessarily - you may break even or even lose money on acquiring that customer - as long as you turn a profit by pushing subsequent offers later on.
Example: Over the years I've joined some mailing lists where ALL the owner does is review online marketing products and services. They pick the best products/services and write enticing emails to tempt me into buying through them - over and over and over again.
(You may be wondering: Why wouldn't I sign up to become an affiliate to get a discount on these products? Truth is it's usually more trouble than the savings are worth. And often there's a minimum payment threshold you need to reach in order to get paid.)
Pick a niche where the audience is always looking for new solutions / more solutions / more "shiny objects", and you're golden.
That way, you can focus on the frontend, not be tied down by any one product, not bother with customer service, AND STILL own your customer and be able to sell on the backend.
You can have your cake and eat it too.
Amy
@vortex I'm pretty sure this is Charles Ngo's business model at this time.
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