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Affiliate Marketing Overview: is this another fad or a good way to make passive income?

What is Affiliate Marketing?

Affiliate Marketing is where a company signs up people, or other companies, to sell their product.  

Wow! We now have a definition, but does this really explain what affiliate marketing is? Let’s see if we can break it down a little.

How does Affiliate Marketing really work?

Companies produce and/or sell products.

The products sold may be actual physical items like tennis shoes, golf clubs, or even candy bars. The products may also be informational in nature like e-books, audio books, musical downloads, etc?

When a company decides to sell a product they may also decide to pay other people a commission to help sell the products. The person who helps a company sell their product is an affiliate of the company. Therefore affiliate marketing is where an affiliate helps a company bring their product to a specific market and sell it.

What is Niche Marketing?

Okay, we’ve defined affiliate marketing but there’s another phrase I keep hearing around the Internet – ‘Niche Marketing’. What does this ‘Niche Marketing’ mean?

Niche Marketing is the selling of products within a subset of a market.

Huh? What was that?

A Niche Market is really a small segment of a market. Let’s use shoes as an example. A broad market would be shoes. You can break that market down into tennis shoes, dress shoes, boots, high heels, flats, and many other categories. If we take tennis shoes we can break that down even further into Converse, Diadora, Keds, Saucony, etc. Now let’s take the Saucony and break that down into running, minimalist running, trail running, race, walking, and originals.

Notice that as we break a market further apart less people are looking for that product. This is how you find a Niche Market.

How does Affiliate Marketing relate to Niche Marketing?

We already know that affiliate marketing is where a person or company helps another company to market and sell a product. Niche marketing is where affiliates help companies that compete in a smaller portion of the market to sell their product.
So why would affiliates help sell products within a niche market?

Here is the real rub. Why would an affiliate help a company sell their product in a really small market? This really is the mother of all questions. Why sell a product that very few people are looking for?

When you compare the number of people looking for a product in a niche market compared to the broad market it does appear to be a small number of people.

What if you look at a niche market just based on the number of people who are looking for that market? Let’s say you are looking at ‘Saucony Running Shoes’ as your niche market. There are exactly 3,600 people who are looking for Saucony Running Shows every month! If you were able to get 3600 people every month to look at Saucony Running Shoes how many shoe sales do you think you’d make?

one percent of 3600 people is 36. So, if you can convince one percent of the 3600 people to buy shoes, how much do you think you’d make? If one pair of shoes sells for $29.98 then you’d end up helping the company make $1079.28. If the commission for an affiliate is six percent you would earn $65.00. Now, if you can convince the 36 people to buy a shoe worth $145.00 you’d help the company make $5,220.00, and your commission would be worth $313.20.

If you have setup a website to assist you in selling the company’s product and you have the 3600 people visiting, then you can basically forget about the website. Well, you might have to go change the shoe you are helping to sell every now and then, but you would not have to do something to it every day to keep the traffic coming in.

This is the basis of affiliate niche marketing. Setting up websites that will continue bringing people in who are looking for the product you are helping to sell. Once the site is up you can forget about it and it will continue to generate revenue for you for a long time.

Now someone of you will be saying, I see what you’re driving at, but those numbers? where did you get those numbers and is this really realistic or is this some type of pipe dream? Can I really setup 15 or 20 sites that bring in $50.00 to $100.00 a piece, and do it where I don’t have to mess with anything? Can I really generate passive income from niche marketing?

Let’s look at an overview of how to do this!

Let’s look at a blueprint of how to do niche marketing first

1. Find a niche
2. Discover useful keywords
3. Find and register a domain name
4. Develop content
5. Drive traffic to the website

Finding a Niche:

What’s the easiest way to find a niche? Well, I guess it depends on what you want to sell. Are you looking to sell a physical product or do you want to sell an informational product? For physical products you would go to Amazon and look at the products that are selling well. For informational products you can go to places like clickbank and browse the products there. Make sure the company selling the product does have an affiliate program. Register with the company so you can get affiliate links to post to your website.

The affiliate link will be unique to you and will relate back to an account where the commissions will go when people click on your link and purchase the product. The affiliate program can be different from company to company so make sure to read the sign up information at each company site.

Once you find the product you want to sell you then have to find the keywords.

Discover useful keywords:

There are many tools available, both paid and free, that can help you find useful keywords. Most of them actually use Google’s keyword tool behind the scenes.

So go to Google’s Keyword Tool. You can sign up for an account or use the tool without signing up. The tool will return up to 800 keywords if you sign in, but will only return 100 keywords if you don’t.

Enter the market for the product that you have chosen to help sell for in the word or phrase box. Make sure to check the ‘Only show ideas closely related to my search terms’ and then press the search button.

This will return the search term you entered followed by all keywords that have had a search performed on them in Google. If you look to the left of the screen you should see a ‘Match Type’ section. Check the [Exact] match box to see how many searches were performed with that exact keyword combination.
 
Next you should take that phrase and type it into a Google search box to see how many websites exist with that phrase. If the number of websites is low and there is a decent enough exact keyword searches then you have found a decent niche to work in. What numbers are good numbers? Well, you don’t want a million websites with that phrase on it and you want more than 10 people searching each month for that exact phrase.

Find and register a domain:

You want to find a domain that relates to your keyword search in some manner. If your search phrase is Siamese cats you might try siamesecats.com or siamesecats.net. Register the domain and setup domain hosting somewhere.

Unfortunately the register and setup process is beyond an overview of affiliate marketing, however, you can find how to register a domain at Namecheap and setup hosting at HostGator.

Develop content:

Once your domain has been registered and hosting has been setup you will need to start writing content. You need to write articles about the product you will be helping to sell. You need to write good articles about the products you want to sell. Basically you want people know that you understand what you are talking about. Don’t lie about it. If you don’t own the product don’t say you do. If you have never read or touched the product don’t claim you have. Don’t plagiarize. If someone has written about the product and you think it’s an excellent description, do not copy and paste it on your own site.

You are attempting to write relevant content for Google to see and index. If you take something someone else has written, Google will see this as duplicate content and you won’t get indexed or you won’t get a high index for the article. Not only that, most unique content is copyrighted. Taking somethat that is copyrighted is illegal. But, more importantly, it’s just plain wrong to steal work someone else has done and claim it as your own.

Make sure what you write is relevant to the product and that you don’t copy what someone else has written. If you do this your articles will rank with Google.

Drive traffic to your website:

The final thing you need to do is get the traffic moving to your website. In order to do this you HAVE to get the address of your website recognized and indexed on Google and Yahoo. So how do you do that? You write a couple more articles and post them to Article Directories. Places like GoArticles and HubPages. You also add your site to web directory listings. You can find these directory listings from places like DirectoryCritic. So post a couple articles to the article directories and in the author bio box you link back to your website.

Posting the articles and listing with web directory listings will start getting your site recognized by Google and Yahoo. Once your site shows up on the first page of google for your keywords you’re good. At that point you should be researching more niche markets, finding keywords, registering domains, writing content, and driving traffic.

Once you have 20 to 30 sites that are bringing in $50.00 to $100.00 a month you then need to decide how many websites you need.

So, affiliate marketing is not a fad but it’s not an overnight get rich quick scheme. You can find many ‘programs’ on the Internet that claim to teach you how to do this and that you can make millions overnight. Again niche marketing and affiliate marketing are not overnight get rich quick schemes, but you can generate as much passive income as you are willing to work for!

 

 

About the Author

This has been a brief overview of Affiliate Marketing and the relationship with Niche Marketing. You might take a look at Niche Profit Classroom Site to learn more about how Affiliate and Niche Marketing work.

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