In an earlier post, I described in brief 5 popular business models for an online business. In this post, I want to review 2 of the most popular, Affiliate Marketing and Product Creation.
When I listen to the successful marketers, I hear two strong points of view on this subject. Many say “Product creation is the only way to succeed online” while many others say “Start with affiliate marketing, it is the easiest”.
Keep in mind that doing one does not negate the other, but when you are just starting out, pick ONE.
Product Creation Pros and Cons
If you are a blogger, you should definitely consider having your own product to sell. This could be a simple e-book or information product, or it could be a complex and high-value monthly membership or video course.
When you create your own product, you are in total control. You decide the price, you decide what affiliates will promote your product for you, and you choose the type of product you are going to create.
Creating a product of your own can be time consuming, depending on the type of product you create. E-books can be very easy to make, and are a smart way to get started in the product creation process.
However, you are in charge of market research, finding potential customers, marketing your product, handling refunds, delivering the product, while also building and maintaining a good reputation in your niche or market.
On the upside, you can create as many products as you like, as quick as you can create them. Keep in mind that quality is far more important than quantity.
Sometimes with the affiliate marketing model, it is difficult to find quality products you feel comfortable promoting. When you make your own product, you can make it as value-rich and beneficial to your customers as possible.
You are not at the whim of some company who decides to change its agreement with you, or end the relationship or stop supporting the product.
Affiliate Marketing Pros and Cons
The biggest benefit of affiliate marketing is that it is easy, simple and probably the fastest way to make money online.
What could be easier than referring someone to another website, and if that person makes a purchase, you get paid?
With this simplicity comes some negatives though.
You are never in charge. Even if you enjoy a great relationship with a company whose products and services you promote, they can change their terms of service, commission structure or affiliate agreement overnight.
This means you can go from making thousands of dollars a week to hundreds of dollars a month, and you have no say-so in the matter.
It only takes one person to complain to the company you are promoting for them to terminate your affiliate agreement. In many cases, the terms of service are lengthy and detailed. If you slip up in even the smallest way, you can find your agreement with a company terminated without even being able to defend yourself.
That having been said, affiliate marketing is an attractive business model because you don’t deal with customers. The company you are promoting handles customer service, returns, customer satisfaction.
In the case of large affiliate companies like Amazon, they work very hard to make sure that a sale is made once you get someone to their web property. They are also great at up-selling for you.
With affiliate marketing, you make a commission on the sale of the product. With digital products, the commission is usually between 50 and 75%. With physical products however, the commission is usually between 5 and 10%.
Product creation and affiliate marketing both offer pros and cons as Internet marketing business models. Whichever you choose, get started immediately.
Stop fussing and stressing over whether you should create your own product for sale, or become an affiliate marketer. Choose one of the business models and get started on your path to financial and time independence.
