I’ve been doing a little affiliate marketing and my first campaign with eBay is doing great so far. I would like to share what I’ve come to learn to save you all the time and money in starting out in affiliate marketing.

Find A Merchant

As for example, eBay, they have an in-house affiliate system that lets you earn money per sale of item. A percent of the price of the item is given to you as a commission.

You may come and apply as eBay’s affiliate by signing up, its free, but you’ll need a website to apply. Payment are sent by Paypal with minimum of $5 per month. Payments are sent every 25th of the month.

Not all merchants have their inhouse affiliate system. This is what Ad Networks do. They have the system, the tracking and the merchants, all they need are internet marketers or affiliates to help them promote the merchant’s product.

Money are made differently with these type of networks and will vary from merchant to merchant. An example is a Mortgage Company, they will pay you if you get a visitor to sign up and fill up a valid form. This is called Pay Per Lead. If the merchant offers CPA, they want sales, and they will pay you for every sale, its called CPA, Cost Per Action. The thing I’m doing with eBay is CPA.

An example of an Ad Network is PepperJam Network, I’ve been using them and eBay is also advertising on PepperJam. There are tons of ad network around like Commission Junction, Azoogleads, but personally, I say that PepperJam Network is the easiest to get into. CJ needs legal papers that you have to fax them and Azoogle doesn’t accept applicants from the Philippines.

Get An Affiliate Site Up

Buy a hosting and a domain this is by far the best way to start in affiliate marketing. So when you mess up a site and its reputation, you won’t mess up your main site. But if you have your own way to promote products or give a review on your personal blog, that’s your choice.

After you found a merchant. you can go talk to your affiliate manager on how to go about promoting the merchant’s product. But you can also go on ahead and build a site around it without telling them. If you are going to make a site around the merchant’s product, keep in mind that you should have the 3 important pages that Google wants in a site. It is, Privacy Policy, Terms of Service and the Contact Page. An affiliate website should contain this pages so not to regard you as a spam site when visual inspection happens.

Some affiliate call this a landing page. But years have changed that google doesn’t allow landing pages anymore. Landing pages today is a mixture of a 1 page with sales pitch and a blog or a review of the product. Making the site as legit as possible in the eyes of Google.

Promoting Your Affiliate Site

There are 2 ways to promote affiliate products.

• Organic SEO Traffic - Traditional link building and optimizing of pages for organic search engine results. Most people prefer this one because its free. The only drawback with this kind of internet promotion is that it takes a while before you see results.
• PPC, Paid Search - Most of the big time affiliates invest in PPC or Paid Search internet marketing. The benefits of this is that you can see results instantly. The only drawback is that it costs money to promote. And sometimes will cost you even more when you messed up. I suggest not to mess with PPC or Paid Search unless you know what you’re doing.

Other Way

• Social Media Promotion - I think to best describe this is an A list blog. When an A list blog make a review of a product, you know that a percent of his readers will buy that product. There are no drawbacks and the promotion is free.

Tracking Your Sales

PepperJam Network has their own tracking system. You can track the # of clicks and the amount of money you earn. And by using other programs like Tracking202 to track the clicks and the keyword they used to arrive at your site, the percent of conversion, you can easily scale your campaign to a larger profit.

Scaling Your Affiliate Earnings

Scaling is the last part of affiliate marketing and is the make it or break it part in this industry. For example, if you can earn $400 this month, be sure to scale what you’re process of obtaining that $400 per month and SCALE it to make it to possible $500 per month. Know what makes your earnings and scale. An example scenario is that an affiliate marketer has been promoting in MSN. Earning $500 per month. He decided to scale his campaign, went to Yahoo Paid Search then in Google Adwords, he netted from 500 to $5000 per month.

Affiliate Marketing has a huge potential and many people are silently earning millions of dollars per month at home.

Ok my post about the “No Money on Pinay Scandal Keyword” I kind of feel obligated to educate people on how adsense goes and how to UP your earnings.

Let me give you a little drawing, tell me, if you are Google, what will be your decision?

Most likely if you’re in the right mind, you’ll pick HIGH CTR to put Mr. Gates’ Ad to get the best ROI for him. Then if you’re google, you’ll reward the HIGH CTR site with high paying clicks. And if HP or Dell decided to join the bandwagon, you already know what site to pick. Because Google knows your visitors are golden converting machine.

Then, you’ll put Poor Advertiser on the LOW CTR site. This is not necessarily Smartpricing just yet. If Google sees your CTR is just crap, even for the Poor Advertiser will be hurting, Google will change the price of Poor Advertiser’s clicks to 0.01 to 0.20 which is called Smartpricing.

Demystifying CTR and Conversion Rate

CTR or click through rate is the rate of successful clicks per impression. How many chances does your ads are getting clicks. Example. Pedro is looking for the programming software that mr gates is selling. He saw HIGH CTR’s ads. Clicked on it. Well what do you know, successful click. Click. On to the advertiser’s site we go.

Conversion Rate. On the Advertisers site, Pedro did not purchase the product. He changed his mind. Conversion rate goes down.

That’s how it is. Conversion rate is not related to CTR. CTR Only gives you the chance to get the high paying advertisers and gives you the candidacy for Smartpricing.

edit: If you have HIGH CTR and Low Conversion most likely its click fraud. If you have LOW CTR and High Conversion, it doesn’t matter, your clicks are cheap anyway + you might get smart priced.

The big question : Does CTR affect my cost per click (EARNINGS)? YES. Is smartpricing real? Hell yes.

The thing is, if you’re confused about google’s tos about adsense and CTR? Don’t go quote it if you don’t know it yourself. CTR is there to let google know what kind of site you are. Conversion rate is for the merchant side. If the CTR and conversion rate has too much difference, you’ll get flagged as click fraud.

Hell, to make it simple, if you want to earn big bucks in adsense, aim for high ctr. Dump the conversion shit. You have no way of knowing anyway.

But hey, who am I? I have no 4 years of experience in blogging.

Last night, before going to sleep, I was watching a video from the previous affiliate summit in Las Vegas. One part of the summit, affiliate marketers get the chance to talk and answer some questions on how to go about the affiliate marketing industry. Right after that talk, there were A list bloggers get the chance to speak and go about how they earn money in blogging.

I just noticed, John Chow, wasn’t with the bloggers that earns money, he was a speaker with the affiliate marketers. lol. Just proves what he really is about. Making tons of money not by blogging buy by affiliate marketing.

Now on to the topic, there was a question from the audience that brought my attention… You see, the Social Bloggers are promoting social interaction with people with other blogs, building relationship and says that building relationship takes time (and reputation). I agree with that… Now, what really hit the spot is the question “Don’t you think its kind of time consuming to build a relationship with people, answering blog comments, posting blog comments, posting to twitter, promoting your blog and still you get that $30 adsense check per month?” The panels said, “Well yes, its time consuming… But if you want to really build the relationship and trust with people, you’ll do this things.”

I am amazed, and I realized how much these people spend time with their blog. For me actually, this is kind of the extreme… Twitter is extreme. Its a micro blog that let’s you tweet a one liner post and let the whole world know. It is the extreme because it kills the “REAL” social interaction. Phone calls, dinner, going out. And most importantly, they starve! $30 adsense check (coming from an A list blogger!)… This really proved that you won’t earn a lot of money with adsense on a blog (a personal, blog about anything blog). But with affiliate sales and direct advertisements.

Now on to affiliate marketing, this is my favorite part of the whole summit. Super affiliates earning 5 digit ($) a day sharing their secrets and tips. What I noticed is that these people are off high intelligence (geek as they say) but with a business sense. One speaker, Amit (forgot his surname), a Ph.d in Physics, an affiliate marketer, using his knowledge in physics to get that tons of dollar a day. What I like about affiliate marketing is that they focus on methods, efficiency and most importantly, time.

Comparing social blogging and affiliate marketing in few words:

Social Blogging

The How :

• Build trust, socialize. Hence, social blogger.
• Transparent.
• People know you as a person, what’s your business, how you make money.
• Doing things for the passion of it. Money is secondary.

The Money : Direct advertising, Contextual ads, Affiliate sales

The Bad : Too much time needed! Too much!!!

The Good : Very rewarding, fame and popularity. Lots of money from direct advertisements.

Affiliate Marketing

The How :

• Build sites that caters to the needs of consumers.
• Most of the time, anonymous.
• You don’t want people to know who owns this site or how you make money.
• Money and time is the primary goal.

The Money : Pure affiliate sales

The Bad :

• Too much competition.
• Sites being ripped off.
• Needs to have programming, copywriting, designing and marketing knowledge.
• Lots of loop holes.
• Will cost you money if you fail (lots of it).
• People don’t know you.
• Will cost you time and not sure of the profitability (high risk).

The Good : Tons of money to be made, I mean tons. People don’t know you.

I think the fact that if you want to make money online goes for everybody in what they want to be like. If you’re passionate about writing, socializing or just blogging, you can make decent amount of money by being a social blogger. But if you focus on the business, efficiency and lots of money and want to take risks, go for affiliate marketing. There are also some ways to earn money online but these two are pretty popular so far.

In terms of making money online, what will you choose?

As all of you would know, I’m a web designer by heart. And I dedicate most of my time joining contests and doing freelance web design and development work for clients. But I am also an entrepreneur in nature, and whenever I get the chance to slack off from my web design work, I do some affiliate marketing on the side. I just got accepted to eBay US’s affiliate program where I go and promote products from eBay US. My first month was a disaster as I only made $22 (11 GBP).

But for last month (month of May 2008) is a good one. I made over $400 in commission.

Noticed I have GBP, to convert that into dollar its usually around x 2. So I managed to get $446 for this month. Around 18,000 Pesos. It’s not that big, its not small either. From $22 to $446. Not bad for a birthday present.

For those who don’t know, affiliate marketing is where you “market” a product of a merchant and you’ll serve as a middle man. Each referral you bring and converts into a sale, you get an affiliate commission.

It works best if you have a review blog of products (say high tech gadgets) with a large traffic / reader base.

With this kind of tactic, its easy to break the $1k in 3 months.

Everybody loves eBay!