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Click here to make me rich | page 1, 2, 3
And, in the latest competitive twist, a few merchants such as Art.com and One & Only personals offer a cut on everything a new customer spends now and in the future. It's an affiliate annuity. If you're affiliated with a lonely hearts service, Schwartz quips, it's as easy as attracting to your site a lot of losers who can never find dates. Despite the rapid growth (affiliate merchants and networks have organized conventions on each coast this year to talk among themselves), Refer-It's Marciano, Schwartz and others believe that the model is still green, and that more innovations are coming. Merchants are just beginning to understand that a few thousand dodos are not nearly as effective as a dozen hawks. Jupiter estimates that 15 percent of affiliates earn about 85 percent of the commissions; Marciano believes it's more like 2 percent that earn 98 percent. Jupiter says that in late 1998, about 30 percent of CDNow affiliates weren't providing even a single click-through, let alone sales. The reality of the situation is that for the vast majority of affiliates, making a profit (defined by many as earning more than they're paying out in online fees) is a pipe dream. They just don't have the traffic. A survey by Refer-it found that the median annual affiliate earnings was $50. And of the 120,000 CDNow affiliates in late 1998, only 100 made more than about $30 a month. If you're not making significant cash, affiliate links may be doing more harm than good. "People see becoming an affiliate as a no-lose proposition," Schwartz says. "But if a surfer's attention is the most precious commodity online, those links can be expensive diversions. It's hard enough to get people to come to your Web site and now you're sending them somewhere else for 50 cents. You may have squandered their attention for good." There are other pitfalls that put thorns on the rose. Though many programs cut checks monthly or quarterly, in most you won't see any cash until you've reached a minimum level of commissions, typically $25 or $50. One contract I read included a clause that reneged on commissions if you left the program before earning the minimum payment. You also risk, if you sign up with less established programs, losing your commission when the company fails, or disbands its program without cashing out, or changes its operating agreement. And a few large merchants, such as Amazon, forbid affiliates from buying books or CDs through their own links. (Though most merchants aren't crazy about having affiliates that join only to get rebates on their own purchases, they write it off as a loyalty program. You don't even need a Web site these days -- Barnes and Noble has launched an affiliate program for the e-mail-bound, although it too forbids buying through your own links.) What I learned from the pros was not to shove my precious visitors around without giving careful thought to the long-term consequences. To make real money, a webmaster needs to build a dynamite site and distinguish it from the ever-expanding universe of cookie-cutter pages. The affiliates that do well are those devoted to a niche -- a certain movie or band, gardening, fly fishing, divorce -- who choose their partners carefully. Their revenue links are seamless. "If you run a site such as Quicken.com, then of course you're going to have a page of books about personal finance," Schwartz says. "In context, it's a perfect idea to become an affiliate. But if you're Joe's Mall and all you have are 37 affiliate links and that's your site, that speaks for itself." Although I instinctively joined about a dozen
affiliate programs while writing this story, speaking to Schwartz and other
affiliate gurus helped
ease the symptoms of my addiction. No longer do I check my online revenue
reports every day (it's every other day now), and recently I consolidated
some of the links on my video reviews. I like to boast that the commissions
I earn cost me nothing. But there's a hidden cost: The tens of hours I
spend to promote and update my site to maintain the traffic necessary to
earn even meager commissions. Taking that into account, I've earned less
than 5 cents an hour. That's not easy money. Not that I'm giving it up -- I've already invested the time -- just toning
it down. The experts convinced me to not to spread my loyalties thin.
Meanwhile, new webmasters continue to sign on, pushing the affiliate
revolution toward that day when it reaches a critical mass. Every site will
be a storefront; everyone will be an affiliate of someone else. You buy
mine, I buy yours -- it all evens out. I can just see this story, told to
me by Marciano of Refer-It, repeating itself: He wanted to send flowers to
his girlfriend, so he placed an order with Proflowers.com. "I had signed up as an
affiliate, so I got a small commission on the purchase," Marciano says.
"It's like that commercial -- is it love or is it the miles?" It's a match
made in affiliate heaven, given what Marciano says happened next: "My
girlfriend phoned to thank me for the flowers, then asked if next time I
wouldn't mind buying them through 4charity.com, a site she
runs to raise money for charity. She wanted the flowers, and the
commission."
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