What does it take to build a successful digital business from scratch? While many people will believe this is far from their reach, this isn’t so. With a business model known as affiliate marketing, it can be relatively straight forward to build a successful digital business from scratch, even without any products of your own or any previous experience.
With affiliate marketing, the “affiliate” joins a program and refers customers to products through their unique affiliate link. The affiliate link is simply an identifying link through which to sell other people’s products. When a sale is made through your link, it gets tracked. Any sales you generate are automatically credited to your account. You get paid a percentage of the sale price, according to the terms of the affiliate program.
Amazon, for example, has an affiliate program. Anyone can join Amazon’s “partner program” and make money by selling items from the site. Since there’s thousands of products to choose from on Amazon, it’s a relatively simple way to monetise a website. If you already have a website, which sells golf supplies for instance, simply link to golf related products from your site. Each sale you generate is recorded by Amazon and you’ll get paid a commission based on what you sell.
Hey presto, you have a digital business! But what if you don’t already have a functioning website, and a tonne of traffic? Well that’s something you can learn and there’s programs which will teach you how to generate sales online. (Sign up on this website to access one).
Successful Digital Business – Commissions
But before you rush off and join Amazon’s affiliate program, there’s something pretty important you should know. Amazon’s commission rates are the lowest in the affiliate marketing industry. They pay between 1% and 10% commission on most of their product referrals. That’s not much. If you were to sell a $100 product and get the largest possible commission, it would still only be $10! So you’ll need to sell a lot of products in order to make this kind of business profitable.
But there’s other products you can sell instead. Digital products for example pay much more than Amazon will. Most digital products will pay between 30% and 40% commissions if you refer a sale.
That’s a huge uptick from what most physical products pay. Some digital products pay recurring commissions too. These are software type products or memberships. These can be very lucrative once you learn how to make a sale. There’s also high ticket products which pay much larger amounts per sale. The most profitable digital products pay both high ticket commission and recurring commissions for subscriptions/memberships.
No Sales = No Commission
No sales equals no commissions with the affiliate marketing business model. That’s why so many people drop out. They don’t get any traction because they get stuck with the sales part of the business. Affiliate marketing is performance based business model which means there’s no limit to what you earn earn. The downside is that if you don’t learn a strategy which lets you make sales, you’ll struggle to get traction. This is why it’s worth getting help and support with an affiliate marketing business.
There’s several different online marketing strategies you can use to make sales with affiliate marketing:
- PPC – pay per click is one of the most popular methods of marketing online
- Organic – organic marketing methods such as blogging and video blogging allow you to get traffic for free
- Social media platforms can be used to marketing too
- Email marketing can be used in conjunction with other marketing methods
- SEO – Search Engine Optimisation lets marketers rank their content on Google and the other search engines
Ideally choose a strategy which you can stick with over the longer term. If you jump from one strategy to another, you’re less likely to success in any.
Investment
To give yourself the best success with a digital business, you need to invest in both your skills and in marketing your business. If you’re going to focus on organic marketing, it can take much longer to build a digital business. With paid marketing methods, it is both fast and scalable. This means once you have a profitable marketing campaign, you can simply turn up your budget to make more sales. With organic marketing methods such as blogging, this is much more difficult to do.
Paid marketing can get expensive too, which means you’re better off with a business model which offers multiple products and includes both high ticket and subscription commission opportunities. Learn more here. With lower value products, you’ll need to use organic and free marketing methods. Free traffic is much more difficult to obtain than paid traffic. See also affiliate marketing business models.