There are many companies and individuals out there deeming themselves to be within the affiliate marketing space, operating an affiliate marketing business, and worse, stating they are affiliate marketing experts…when they are not.
In this little rant here, I want to explain what affiliate marketing is, what it certainly isn’t, and what to look for when aiming to determine if an individual or company is misleading you about whether they are “affiliate marketing”. There are a lot of fake affiliate marketing companies out there and they are having an adverse impact on the affiliate marketing industry as a whole, so I want to bring some clarity as to what is affiliate marketing and what is not.
The Biggest Emulator. The MLM Bait and Switch.
The biggest trend we are starting to see is companies and individuals indicating they are operating an affiliate marketing agency, when in reality they are using it as a mask to cover up the fact that they are an MLM (Multi-Level Marketing) scheme.
Not to say there is anything wrong with some MLM companies, there are definitely some legitimate ones out there. However, you can almost assume that any MLM that is trying to say that they are affiliate marketing is running an unethical operation, and borderline (if not) illegal one.
There have been several take downs by the FTC in this space, with many more to come. It is my hope that they continue to tackle all the misleading programs out there operating businesses that are built around people joining and paying money, for the ability to promote that same program to others. That is the most common type of scheme that you see, with most people within these schemes losing money (95-97%).
There are some traits that you can look for in these programs that will be a key decider
- Anything With Multiple Levels is NOT Affiliate Marketing. Affiliate programs are single level. If you are part of a program with 3 or more levels (including you), these are deemed multi-level marketing schemes. This is NOT affiliate marketing, in fact far from it.
- Anything Where the Goal is to Promote the Same Program to Others. If you join something, or you have to pay for a program simply for the opportunity to sell that same program, then you are not getting involved in affiliate marketing. These companies have the tendency to call their “participants” affiliates, when in reality they are a notch in the MLM scheme and they are in reality network/multi-level marketers.
- Anything High Ticket ($2,000+). The most common trait of “fake” affiliate marketing impersonators are those that are charging $1,000’s for information. If these companies offer $1,000’s in commissions, they are almost certainly operating their business in a way that relies on “baiting” participants with high compensation. These companies usually end in demise (or in the hands of the FTC) because their goal is to rip a few people off for $1,000’s to earn lots of money, versus actually offering a quality service to people for a realistic, market driven cost.
- A Facade Entry Point Price. You will often times see a program actually offering an entry point into their program that operates in a true affiliate marketing fashion. However, once you join at the $49/$99 level of the program (or some smaller amount), you are encouraged to join at a more expensive level or BUY into some sort upline/downline platform, you have been misled and tricked to think you are affiliate marketing. This is a simple facade that has been set up, but in reality you are joining in on an affiliate marketing scheme.
- Has an Income Disclaimer or Compensation Plan. All MLM companies are required to have a compensation plan as well as an income disclaimer on their website. If you scroll down to the bottom of the page and you see either of these, the given program IS NOT an affiliate program or affiliate marketing. It is an MLM.
- There is a Cost to Join. Affiliate programs are free to join. If you have to pay to join an affiliate program, you should be skeptical. Some companies have a small, nominal fee to prove that you are real, but if you are paying $99 to join an affiliate program it is NOT an affiliate program.
What Affiliate Marketing Really Looks Like
OK, so now that you know what affiliate marketing is not, what is affiliate marketing? I have explained it in detail on the following affiliate marketing breakdown page already, but I want to show you two side by side examples of a program that is affiliate marketing, and one that is not.
The diagram offers you a good breakdown of the differences between real affiliate marketing, and the companies that are pretending to be affiliate marketing.
Affiliate marketing is the relationship between an affiliate, a company selling products and/or services online, and a customer. As an affiliate, you can add affiliate links on your website or elsewhere, and if someone subsequently clicks on your link and buys something, you get a percentage of gross sale. This typically ranges between 1% and 75%, and will vary from company to company.
For example, if I run a website dedicated to selling “golf equipment” and I link off to Callaway to their website through my affiliate links, they will pay me 6% commissions for any sales that I drive to them. This allows Callaway to in essence have 10,000’s of people, across the internet simultaneously promoting their products.
As an affiliate, it gives me the opportunity to potentially promote MILLIONS of products through my websites, social channels and email and earn a great deal of affiliate income in the process. It is a brilliant business model and one that is only continuing to grow online, but there are a lot of companies abusing the word “affiliate marketing” when in actuality they are an MLM or worse, a pyramid scheme.
Affiliate programs are not multi-level, nor do they require you to pay money in order to promote a product or service at a particular level. If someone is trying to get you to join something that is multi-level or that is paid, it is NOT an affiliate program.
There is a proper process, and a proper ethical procedure that all successful affiliates are following these days, and I am going to take a minute to explain this.
Establishing Yourself as An Authority Marketer
There is a right way to create a sustainable and long term business online, and there are many wrong ways. I am not going to focus on the wrong ways, rather the proper way. Becoming an authority.
The most natural way to do this is to choose something that you are truly passionate or interested in and build a business around this. That is not the only way, but it is a great starting point. That way you can truly build a business around something that you love to do.
Let’s say I love basketball, which I do, I could create an entire business and work to become an authority website in a particular segment of the broader basketball category. Let’s say, Basketball Skills and Drills.
I would then build a website, and start building out the content, all while being able to integrate relevant promotions into my website through affiliate programs. There are all sorts of things that I could promote in a niche like this, some examples would be:
- Amazon (1,000’s of products related that pay 6% commissions)
- Ballers Institute Skills Guide/Training (pays 51% commissions)
- Vertical Jump Bands (6% commissions)
- JumpUSA (15% Commissions)
- And 100’s more
This is just brushing the surface, as I build out my basketball skills website and discuss many topics within this niche, I will be integrating highly relevant and useful product/service recommendations to my audience. Through time, I could have 100’s or 1,000’s of pages on my website, driving 1,000’s of unique visitors to my website daily, generating far more than a typical full time income ($1,000’s per day).
To grow your business, you scale your content and traffic. That is the approach that can be taken within any niche, and that is the most scalable and lucrative way to build a thriving affiliate marketing business. So whether you are interested in building a mommy blog, a cats and dogs website, a tech gadget website, a knitting site, sports related site, or a hobby car website, there are literally 100,000’s of directions that you can head.
That is the reality of the affiliate marketing business, and that is how affiliate marketing works. If you are interested in building a thriving affiliate marketing business, there is only ONE place in the world that you should consider, Wealthy Affiliate. It is a community & platform that offers an “all-inclusive” environment with the training, live classes, research tools, websites, hosting, coaching and networking under one roof. Get more info here.
I hope I have offered some clarity on the differences between the REAL affiliate marketing opportunity, and those companies and individuals out there pretending to be affiliate marketing when they are not. I would love to hear any stories you have had, or if you have any questions about the legitimacy of any program (or affiliate marketing in general) I would be more than happy to help you out.