WARNING: This article goes against “popular opinion” and may sound controversial. It’s supposed to. I’m not trying to start arguments, but I feel this needs to be said.
- 1 “I lost almost $20,000 on this”
- 2 Introducing: Your 2,000,000 Competitors
- 3 Why “CPS” is a bad approach for affiliates
- 4 Local Affiliate Marketing
- 5 The LHF System
“I lost almost $20,000 on this”
On March 1st 2017, Amazon rolled out a commission structure change, heavily impacting larger affiliates.
Most of them lost anywhere from 15-40% of their earnings overnight.
For others, it was worse:
Say you were selling televisions, as an example, you could have went from an 8.5% commission, down to 2%.
Meaning a $300 sale used to be a $25.50 commission, now it’s $6.
If that was an income for you of $1,275 per month, you would stand to lose $975 of that.
I remember a friend telling me he was lucky to be only losing around $20,000 on the sale of his website.
And while I couldn’t help get caught up in the news, I was in a very different boat.
I’d deliberately avoided the Amazon affiliate frenzy.
At a glance, it seemed fascinating:
Promote the largest ecommerce brand in the world, get paid a commission for everything they purchase, and rank for high “buyer intent” keywords.
(Buyer intent being a measurement of how likely someone is to buy)
But look closer, and the issues were always there:
Amazon affiliates were never “partners” or “associates” of Amazon. They’re puppets.
And I say this as someone that spends a lot of money with Amazon.
The whole thing reminded me of the ongoing Adsense banning saga…
Now the problem isn’t that they’re banning publishers, it’s understandable they ban people for breaking the rules.
What’s unacceptable is the lack of care or clear rules for affiliates.
Look in any forum or community and you’ll find constant questions and confusions about what is or isn’t allowed.
All of this combined leaves an army of affiliates left in confusion and paranoia about how long they’ll continue being paid.
Combined with Google’s clear “anti-affiliate” stance…
It’s no wonder the model has shifted from building up affiliate sites for the monthly income to building and flipping them.
But aside from the risks of relying on a single company for your income, there’s a bigger reason not to promote them.
Introducing: Your 2,000,000 Competitors
With the commission changes of March 2017, it became abundantly obvious that the home category is the niche to be in…
The whole market (over 2,000,000 Amazon affiliates) began competing for home furnishings and equipment like mattresses, juicers, ovens, etc.
Looking at the top rankings in some of these niches reveals the average sites have well over 50,000 words of content on them:
At only 25c per word, you’re looking at $1,250 on the low end to create this much content.
Excluding the management, which is the part affiliates neglect to mention.
“I don’t have time to do anything else”
Another friend was telling me, reporting the success of one of their Amazon affiliate sites.
They were doing extremely well, for the model anyway.
Even they were at full capacity managing ONE website.
Remember that “dream” you were sold of creating a website that gives you passive income every month?
That was a myth.
Co-ordinating creating 50,000+ words of content so you can launch is far from passive.
There’s tasks like:
- Researching the keywords to target
- Planning out the basic onpage elements (Title tags, Meta descriptions, Heading tags, etc)
- Hiring an army of writers to write this for you (OR WORSE – doing it yourself)
- Reviewing and tweaking their work
- Creating an internal linking plan
- Researching and add images (or co-ordinate someone doing this for you)
- Optimising the content to be more keyword focused
You get the point.
And that’s only to get it “launch ready”.
After that you ideally want to take it from 30+ pages to 100+.
And as you’re doing that, you need to execute a link building plan to rank this many pages.
For the ones smart enough to pull this off, it may be worth it.
Build it up, work your ass off to get it up to around $3,000 per month for a 22-36x multiple, then flip it.
(“Multiple” means the multiplication of your monthly revenue to calculate the website value. So 22x of $1,500/m over 12 months, is a value of $33,000)
It’s not worth the risk keeping the sites, as we discussed in part one.
So you build them up, aiming for the elusive “six figure flip”.
That’s usually reserved for the “Tier 1” affiliates.
The ones with at least $10,000 to invest into their authority website.
Most people will be happy with a $30,000 – $40,000 flip.
Not bad money, by any means.
But let’s be clear:
You WILL work your ass off to get it.
Building a website up to $1,800 a month isn’t easy.
Let’s say the average visitor to your website is worth 25c. Fairly high.
$25 per 100 visitors.
If we presumed a 1% conversion rate, you’d need to have 1/100 people purchase something for $312.50 at an 8% commission. Which is unlikely, but let’s go with it.
Your goal is $60 a day to get the “40k flip”.
240 visitors a day. 7,200 per month.
If we say after seller commissions, expenses, and revenue collected up to the sale, your personal take home is $40,000 (excl. taxes).
And with the average Amazon authority site taking 6-12 months to start ranking… that you do well and this process takes you only 18 months.
That’s around $26,666.67 per year.
Not a bad side income. Not enough to live from, especially after taxes.
That’s because you’re not supposed to.
Here’s the real plan (most people figure out after flip #1):
Step 1) Build a website similar to the one we mentioned until it hits around $1,150 per month in commissions
How long this takes with vary, for beginners with a low budget for content and links, 18 months would be great
Step 2) Flip the websites for $30,000-$40,000
Again, this is barely enough to live on yet
Step 3) Re-invest at least $10,000 into the next site
The goal this time is to go for the elusive six figure flip.
Maybe in another 18 months time, if things go well.
And that can work, extremely well. I’ve watched friends and community members do this multiple times.
But you’re usually mentally limited at being able to manage one website at a time, which severely caps your income.
…AND you’re competing against the best of the best.
Like we said earlier, Amazon affiliate is the “hot” thing to promote. Especially in the home category, where the best commission are.
And even with the help of a conversion rate optimisation expert, and master copywriter, the most you could possibly hope for is… what?… $0.35 per visitor?
Even that is outrageously high for an Amazon affiliate site.
So you’re left working your ass off, competing against the best SEOs in the world, with the hope that your one and only project pays off with a six figure flip…
…IF Amazon doesn’t change anything or screw you over in the meantime.
Meanwhile, the smart and lazy affiliates are out there getting paid $2-$4 per visitor to their website with practically ZERO competition.
Why “CPS” is a bad approach for affiliates
Here’s how the Amazon affiliate program works:
It’s a standard “Cost Per Sale” affiliate model. Meaning you get a commission of every sale.
Most popular ecommerce stores have a similar program, here’s just a few I found in the home furnishings space:
Some of these are arguably better than Amazon:
- Higher commissions
- Longer tracking time (30+ days)
- Less strict and less likely to randomly ban you
Though, you’ll have to test that for yourself.
The curious thing is that most people don’t realise CPS is only ONE model. And not even the best one.
As an affiliate of this model, there’s only a few main keyword types:
You can’t rank for information keywords because they’re useless for commissions. Nor can you rank for “buy” keywords, as they’re dominated by ecommerce brands.
So you, and two million plus other affiliates are all targeting the exact same “Level 2” keywords.
And with this keyword type, there is buyer intent, but it’s not sky high. So on the higher end, you’d be very happy with 1-3% of visitors to your website purchasing something.
This is your model then:
Not too bad. Amazon is a proven, trusted brand at least.
Again though, the best you could possibly hope for is $0.35 per visitor to your website.
Switch your model though, and you can literally 10x this.
See, there’s several types of affiliate offers:
I’ve tested all of these, but the two I’ve profited from the most are CPA and PPC.
See, rather than competing with 2,000,000 Amazon affiliates to make $5-$50 for selling something…
I’m promoting companies that’ll pay me $15-$100 (or more) for a single phone call, or a form submission.
Which do you think is easier?
It’s also completely normal for 10% of the people that visit my websites, using the keywords I’m targeting, to complete this action.
Meaning with a $25 offer and as little as 10 visitors a day. You could be making $25 a day, as an example.
Even on the lower end…
I recently showed an example in one of many niches I’m in, where I have 2 separate websites promoting one offer.
Last year they had a combined 30,420 visitors. The whole year.
And generated $29,900 profit.
I topped that off by sharing that I spent all of ZERO minutes working on those sites last year.
(That’s not bragging, it’s idiotic, I could have made much more money – but I was slacking off)
The “trick” is finding the right niches and offers.
I call it:
Local Affiliate Marketing
And it’s about taking affiliate offers to the local keyword level, where you’re only competing with local businesses.
See, a quick look on MaxBounty shows this offer:
(Probably not the best, that’s only 30 seconds research, but…)
Generate only 5 calls a day for this offer, and you’re hitting $100 a day. $3,000 a month.
Now here’s where it becomes interesting:
I do this nationally, across several “sub-niches” of home improvement.
But rather than trying to rank for some huge national terms, such as “plumbers” or “plumbing services”…
We take it local.
“Plumber in [City Name]”
Remember, if our goal is $1,000 per month, we only need 20 visitors a day (presuming 10% conversion on a $25 offer.
So let’s make it easier:
Start by pulling up a list of suburbs or areas of this city.
Pick the most popular 5 or so, and create a custom landing page for each.
These guys have the right idea:
Next, get a list of individual services that fit within this niche, for example:
Either target these on the landing pages you’ve already got, or create a new one for each, depending on what your competitors are doing.
Now going back to “Leeds” and the “plumbing” example, you’ll be targeting keywords like:
- Plumbers in Garforth
- Emergency plumbing in Garforth
- Drain cleaning inGarforth
- Plumbers in Headingley
- Drain cleaning in Headingley
- … and so on
In a city of 715,404 people, do you think it’s possible to get 20 visitors a day on this website if we ranked #1 for most of these keywords?
And look at our competition for these keywords, do you think you’ll be able to outrank them?
(Research if you like, but it’s mostly large directories ranking 100% from domain authority)
Well, that’s the dumbed down version of how I’m ranking against little to no competition nationally, and making anywhere from $1-$4 or more per visitor to my sites.
So not only is it possible to make anywhere from 3-10x more money per visitor to your website, there’s also significantly less competition.
The question then is:
When one Amazon site making $10,000+ per month can easily be a 2+ year project, building a huge authority site with hundreds of thousands of words, and a $10,000 invest upfront…
And this can be achieved using the local affiliate model, with a few dinky local sites…
Why on earth aren’t more people doing this?
I believe it’s down to not knowing the offers exist.
Most people I’ve shared this with, thought they had to get clients to do it.
Which they understandably decided wasn’t for them.
And that is one way of doing it, which is usually even more profitable, since you can negotiate much better payouts for direct clients.
But it’s not the only way.
In fact, there are thousands of affiliate offers out there to promote, and many which work perfectly for local affiliate marketing.
Most people just aren’t looking in the right place.
They get told by some “guru” that OfferVault is where it’s at, so everyone goes there to target the same offers.
But that’s only a sample of the offers available out there.
The real magic is when you start joining all the reputable networks you can get your hands on.
Here’s a Top 10 CPA Network list:
(Credit to mThink)
You can also find relevant ones for specific niches (I won’t Google that for you).
Apply to every one you can find, then review what they’ve got.
The magic isn’t in finding the offers though, it’s in quickly testing them, and finding hot potential keywords.
The LHF System
Another downside of the traditional affiliate approach is the waiting.
6-12 month average waiting time to start ranking? Screw that.
Local keywords are a lot less.
But even at 3 months, I don’t have that level of patience.
That’s where AdWords comes in.
(No, I’m not trying to convert you here. Let me explain…)
Before putting in my time and money into building up a quality website, buying links, and going through the whole ranking process…
I want to know 100% that I’ve got a winner.
As you may know, local search volumes are insanely inaccurate. 10 searches may actually be hundred, it’s a total mystery.
And I don’t want to waste thousands of dollars, and months on a website, only to realise the offer or niche doesn’t convert well.
So I don’t.
Throw up a basic landing page and hand Google $50 to make it show up in the ads section.
Example (not mine):
Or if it’s a pay per call offer, you can test it directly without a landing page using Call Only Ads, here’s an example of how it looks:
And using this data, you can see:
- How well did the offer convert? (If you were break even or profitable, tweak the ads and keep running them!)
- What keywords were people searching? (Your keyword research done for you)
- Which keywords were more profitable? (Now you know where to focus with your campaign)
If it works, great, move onto the SEO.
Otherwise, even if your standard SEO campaign costs only $500. You’ve saved $450 with this test (never mind 3-6 months of your time!)
Once I know an offer and niche converts, then I’ll go all in with it.
Setting up 5 different city websites to start. These are easily managed, so you can comfortably handle multiple.
If we’re promoting a $25 offer…
And 10% of our visitors call or submit the form…
That means only 20 visitors a day, per website, and we’re hitting $5,000 per month.
If that works, I’ll make it another 5… and another… it’s simply duplicating what works, there’s 51 cities in England alone.
And while you’re waiting for the rankings to “kick in”, here’s a quick way of cashing on today…
This is nothing more than abusing an opportunity in Google’s algorithm while it works.
Doing this is another easy way to generate 50-100+ visitors a day, many times with zero links.
The whole thing ranks based on the number of pages.
Which at only $1 per visitor is an extra $50 per day on the lower end. Not bad for setting up a website once.
But it can’t all be good.
What makes this model great is the ease of ranking and high value per visitor.
Monetisation once you have an offer is relatively easy. The difficult part is finding an offer.
Aside from what I’ve shared above, there’s no easy way of doing this. Simply, join lots of networks, do the research, test them, and then eventually you’ll find good offers.
If you want the best offers though, you’ll have to get on the phone and setup the deals yourself. Which is beyond affiliate marketing, but worth it if you’re willing to do the extra.
The other downside is the somewhat short-term nature of the model. Unlike building a true authority site, you’re not particularly adding much value to the SERPs, since you’re not a real local business.
Now, that doesn’t matter. You can still rank these sites. But getting into the Map Pack is becoming increasingly difficult, and organic is becoming less and less important.
Is it better than Amazon affiliate?
To summarise, there are multiple ways to monetise your organic traffic other than the Amazon Associates program.
Some of which are significantly more profitable per visitor, like the local affiliate model. Is it right for you? It depends on your goals.
But it’s an incredibly lifestyle friendly business model that I’ve benefited from highly over the years, and finally deciding to share with you.
What do you think? Let me know in the comment section below, I’ll also happily answer any questions.