For some reason, affiliate marketing seems to be gaining in popularity, even though there are so many fatal flaws with the overall design. Sure, it may sound great on paper or on a webpage somewhere – get in on a good product and start sending a boatload of prospects over to a landing page somewhere and hope they buy the product so you can earn a commission.So where’s the problem? There are actually five that I see right off the bat.
All affiliate programs are hideously inflexible
The terms are so rigid – you get their product, branded however they set it up, under the seller’s pricing scheme using their marketing materials and are subject to their sales page. Your income is a fixed commission percentage setup at the whim of the seller. You have no control over customer service, the download, that payment, nothing. And you’ll have to compete with thousands of other marketers using the same keywords and who make the same commission as you? Honestly, you’ll be lucky if you get your customer’s name on their way out your front door to visit the seller’s landing page. Is that smart marketing? No…
They are not as profitable as you might think
Without the ability to control your own pricing, you are at the mercy of someone else’s whims. Once that customer is passed off from you, the affiliate, to the seller, you lose control over the customer’s experience. If they wind up buying, then great – you get a percentage. But if they return the product, you’re going to get dinged. And think of this – you’re competing with hundreds, possibly thousands of other affiliates who are selling the same product – at the same price! If only you could offer a sale price and control your own pricing…good luck. It doesn’t exist with an affiliate program.
Affiliate programs offer you little marketing control
As an affiliate, your job is to do one thing – drive the prospect to the sales page and hope the marketing message is good enough. What if it isn’t? You can’t change the sales page. You could be an incredible affiliate and send 60% of your visitors to the sales page and have your commission stink because the sales page stinks. What do you do? Drop the seller and move your marketing efforts elsewhere? What if the product is great? But that’s not all you can’t control in affiliate programs…
They make customers jump through too many hoops
Okay, as an experienced marketer you know one of the holy grails of marketing is to get the customer to leave their email address so you can continue to market to them, right? So they give you their info, then go off to the sales page where they….may have to give their info again, and if they buy…they have to give their info yet again! In order for everyone in the affiliate chain to be satisfied and keep marketing to prospects, they need this vital information. But its the customers that suffer, because they’re the ones who are being inconvenienced and marketed to every step along the way. And you know how much customers LOATHE being marketed to overtly. That brings me to the final point:
These programs sacrificing customer service, and you lose the option to “wow” the customer and make them a repeat buyer
When marketing is done correctly, and you combine it with customer service thats above and beyond, the customer becomes a customer for a very long time, and will give you repeat business. As a marketer, this is money in the bank, so to speak. The inherent flaw in affiliate marketing is you can’t do that as an affiliate. The only person who can really “wow” the customer is the seller with their service! And repeat sales are theirs – not yours as the affiliate. Do you really want to lose that opportunity?
The reason a lot of marketers are drawn to affiliate programs in the first place is because they offer a product. Marketers don’t come up with a product – they come up with marketing campaigns to sell a product. And affiliate programs fill that need by offloading a lot for the marketer – at a cost. And the cost is actually very great when you consider the control you give up in exchange for the product being packaged in a nice virtual bow using someone else’s wrapping paper.Look, there is a better, more profitable way to make money online.Reseller programs are actually much more profitable than affiliate programs and they actually address affiliate program’s shortcomings. With a good reseller program, the terms are incredibly flexible, as you buy a license to resell material. The license typically allows you to set your own price, and more tightly control the product and marketing around it. The ability to control your own price means you control your own profit margin as well.That said, you become the main point of contact for your customers. You talk right to them, directly. You collect their information, you market to them, and you sell to them. You own the customer experience. The whole customer experience.Detractors of reseller programs will say that affiliate marketing is easier. Yes, it may be easier. But its at a cost. You pay dearly for the convenience of not having to worry about anything. And consider that the most profitable and successful affiliate marketers would make even more money in a reseller program. Don’t believe me? Do that math!If a product sells for $50 in an affiliate program and offers you 75% commission, which is about the highest commission there is, you earn $37.50 per sale. You’re a successful marketer, you know what you’re doing, all the right buttons to push. You get 30 sales per month credited to you, that’s 1 per day. As an affiliate marketer you earned $1125 for the month. Not bad.Now let’s turn it around. Let say the same product is offered in a reseller program. Let’s say the same product is offered in a reseller opportunity for a license cost of $250 per month. Sound like a lot? Do the math. If you charged $50 for the product, and still made 30 sales that month, guess what your new profit is? $1250. You just made more money.But the fun doesn’t stop there. The reseller program lets you change the price. So, to get a jump on the competition, let’s say you lowered your price to $40 and got 10 more sales. Your new profit? $1350. Since you control the marketing and sales page, you can tweak your campaigns, landing pages, sales message, direct messaging, etc to increase your conversion. Any pro knows this is all vital to success. And you can’t get any of that with an affiliate program.The truth is, affiliate programs are great for some people. They’re great for starters. But if you’re really serious about making serious money, reseller programs are the way to go.