Complete Transcript – Episode 2

Why Choose Affiliate Marketing?
– Understanding the Basics, Pros and Cons

Hello and Welcome to the Smart Affiliate Marketing Podcast!
My Name’s Paul – and in this episode, we’ll be looking at the pros and the cons of affiliate marketing.

So let’s take a brief look at what affiliate marketing actually is and how it works.
There are three basic affiliate marketing models.
The first one is “Pay per Click”, where you basically earn a commission every time someone clicks your affiliate link, regardless of whether they buy anything or not. So you basically make a commission for getting people to the store or website.

The next is “Pay per lead”, where you basically get paid if somebody shows an interest, like filling out a form with their email – after clicking your link. So you’re basically getting a commission for getting somebody’s contact details for another company.

And then there’s “Pay per Sale”, which is the classic affiliate marketing model. You only earn a commission when somebody clicks your link and actually makes a purchase. So you’re basically making a commission for an actual sale that you bring in.
This last one is the most prevalent and popular method of affiliate marketing, and therefore is the one we will usually be referring to throughout these podcasts. This is how most super affiliates make their income due to the higher commissions.

Now let’s look at the pros of affiliate marketing
– or the positive points of being an affiliate marketer.

The first pro is that there is a low barrier to entry, so the start up costs to become an Internet marketer or affiliate marketer are very low compared to starting a traditional bricks and mortar business.

You can invest money to help you in your journey to help speed up success, but you can get started for basically peanuts or next to nothing in the online space.

The good thing about the workload is that it’s very flexible. You can basically dip in and dip out of this whenever and wherever you like, so you can work any time of the day when it suits you. You can work from whatever location you like, as long as you have a device and Internet access, and it gives you so much freedom compared to a job – you don’t have to commute. You don’t have to clock in and out. You just work whenever and wherever you like.

The next pro is scalability. Once you’ve got an income stream up and running, you can then scale that. You can either scale that particular income stream, or you can apply what you’ve learned in developing that stream and develop another one, so the income is potentially unlimited.
It’s only limited by how much work can you do to develop these multiple streams of affiliate income.

The next pro is the passive income potential. So whilst at the beginning you’ll have a lot of work to do in getting things set up and bringing in that first stream, the ultimate goal is that eventually you will have some passive income, meaning that the work’s already done in the past, but the income is being produced regardless of any additional work you do. And for me, that is a nice place to be, because that gives you so much freedom of time to follow other pursuits and interests.
The next pro is, there are a huge variety of niches where you can become successful and make money. Again, this is literally unlimited, and we’re going to help you find a niche in future episodes.

And the Final Pro is that you are your own boss. You don’t answer to anyone. Whilst you are an affiliate for various companies and you may have some rules to follow, you are essentially your own boss, meaning you can work whenever you like, you can slack off whenever you like, and you are in control of your destiny. Nobody can make you redundant. Nobody can outsource your job. Nobody can tell you you’re not good enough, and you don’t have to put up with people telling you what to do all of the time.

You don’t have other people enforcing deadlines on you, and you don’t have to follow corporate guidelines.

OK, let’s move on to the cons of affiliate marketing or the potential downsides.

The first one I want to talk about is that income is not guaranteed. You can – and indeed you already may have put in an exceptional amount of work but not made any realistic income.
So the thing to understand with affiliate marketing is, it is like any other business. You have to invest initially in terms of time and or money, but the income doesn’t follow straight away. It’s not like having a job where you go to work for a week or a month, and you get paid at the end of the week or that month.

With affiliate marketing, you could put in a few months work without getting any return on your time or money investment, and this is where a lot of people fail. They believe that the income is going to happen overnight. They do some affiliate marketing, and this magic tap turns on this stream of income that comes flooding into their PayPal or stripe account.
But in reality, it doesn’t work out that way, and this is why so many people give up. So this is all about having the right expectations in that the work needs to be done at the outset during the initial time and then added to later. But the income follows behind with some sort of delay.

Quite often as well, when you sell affiliate products, there can be a period where they don’t pay the commission out for 30 days, for example, in case that person returns the product or cancels, which means that you have to wait that 30 days out until you can receive your commission. So that is the first drawback. The income is not guaranteed, and there can be a big time lag between when you start doing the work and when you actually get paid.

The next drawback is that you can be subject to external factors, such as platforms or businesses going bust or changing the rules or imposing new restrictions on how you can promote things.

So to position yourself in such a way that you’re not likely to fall foul of these, I suggest any affiliate offer you are promoting make sure you learn the rules, find out what you are and are not allowed to do in terms of promotion. Also, check out the company. Do they have a good track record? Have they been around for a while? What are the chances of that business surviving into the future to make sure that you get paid?

The next con of affiliate marketing is time commitment. Now, if this is starting out as a side hustle around a full time job, finding the time to learn, take action and implement can be difficult. In a later episode, we are going to come on to “time management”, but essentially you should be blocking off chunks of time to work on your business to develop your affiliate income streams. This is a drawback, but if you don’t have a job and you are doing this full time, then time commitment is not a problem. But you still do need to remain focused and make sure you use your time effectively.

And the last con of affiliate marketing and perhaps the biggest con of affiliate marketing is “Shiny objects”. There are so many people out there selling snake oil and get rich quick overnight products and software that will turn on the tap, the money will come flooding into your account overnight, how AI can basically make you a millionaire within the next three weeks. And honestly, a lot of these products are not worth your time, your money or your effort.

My philosophy is you learn how to do things from the people who know how to do these things. You don’t need to learn everything. You don’t need to do a course on video, on audio, on podcasts, on marketing on article marketing on WordPress websites. You don’t need every software under the sun for all these different things. You just learn one thing at a time and implement one thing at a time and keep on the path to success remaining focused at all times.

We’ve all been through the cycle of buying shiny objects. You start using it and then you see another advert on Facebook for another shiny object. And you think, Oh, yeah, because I’m not making money with what I’m currently doing, let’s move on! This one looks really good. Yeah, I’m gonna buy this one and get stuck in, and you just end up in this vicious cycle of buying courses, getting part way through, giving up, buying another course, ad infinitum, ad infinitum and constantly spinning your wheels and getting nowhere.
So this is the big con of affiliate marketing is chasing shiny objects and not focusing on one thing until you become successful.

So in summary, the pros of affiliate marketing are a low barrier to entry flexibility of working whenever and wherever you like scalability, the passive income potential, huge variety of niches available and being your own boss. Those are the pros.

The cons of affiliate marketing are that your income is not guaranteed and there can be a time lag between when you do the work and when you get paid, you can be subject to external factors of various platforms. There is the time commitment which you have to manage, and the biggest con is shiny object syndrome, leading to a lack of focus.

OK, if you’re liking the information I’m giving you, feel free to subscribe or follow this podcast, there’s no charge. Just click the button on your screen.

And in the next episode I’ll be imparting some key information to help you decide if affiliate marketing is the right business model for you.

OK, I’ll see you next time on the Smart Affiliate Marketing Podcast.
Goodbye for now.