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How competitive is this niche?
Backtrack the competition.
For some reason, many affiliates like to link everything they do, to everything else they do. So, you can often see lucrative stuff being linked to other lucrative stuff. Ummm, don't do this with your own stuff for various reasons. This is one of them.
Use your head.
Figure it out.
Top 100 searches. What's hot? What are the new topics coming out?
What will people buy that are searching on these topics?
What kind of ideas can I extrapolate here?
Thinking about the future.
This takes some serious contemplation, sometimes with no result. Usually no result for now, anyway. Think great dividends for being first, possibly pioneering a niche.
When you present the idea to the wholesaler it is important that you stress that this will not be any extra hassle for them. For example, offer to always keep a credit with them so that they never have to worry about getting paid from you, and make sure to stress that it will be your return address on the packages and no customer will ever contact them about a return or complaint of any kind.
Alby - in digging into one of your earlier posts, I noted what you had to say about customer relations and relations with the supplier. These are the very involvements I prefer to avoid. The venture would have to be so financially attractive that I would be willing to take on those sorts of headaches which are nonexistent with the affiliate model.
Jane - With those rankings, drop everything and exploit the potential you have. If you haven't already, find a good affiliate program offering the products. Assuming you're talking nutritional supplements, the commissions should be good. Construct and optimize a number of additional pages for the keyword combinations you're seeing in your stats. Look at the Overture Search Term Suggestion Tool and the Google Adwords keyword tool. Link to the new pages from your mother page, but don't link back. Go for it!
With those rankings, drop everything and exploit the potential you have. If you haven't already, find a good affiliate program offering the products. Assuming you're talking nutritional supplements, the commissions should be good.
Yes, I realize I have a lot to learn about marketing. This is all very exciting to stuff for me. I need to drop my salaried programmer in a cubicle mentality and think more like a marketing person looking for potential opportunities.
Lot's of food for thought in this forum. Thanks for all of the advice and encouragement.
DOGBOY'S BRANDED AFFILIATE AGREEMENT
This Affiliate Agreement (hereinafter referred to as the "Agreement") is made and entered into on this ______ day of ___________, _______ (hereinafter referred to as the "Execution Date") by and between ____________________ (hereinafter referred to as the “AFFILIATE”), having a place of business which is located at ______________________ and ______________, (hereinafter referred to as the "COMPANY"), having a place of business which is located at: _________________________________________________________
WHEREAS, the COMPANY provides certain goods and/or services including but not limited to ______________________________________________________ under the tradename(s) ___________________________________________________ (hereinafter referred to as the "Products and/or Services").
WHEREAS, the AFFILIATE and the COMPANY desire to enter into a "branded" affiliate relationship wherein the AFFILIATE will promote and facilitate sales of the Products and/or Services for the COMPANY under the name and promotional web site(s) of the AFFILIATE. As used herein the term "web site" shall include without limitation any location, domain name, address, home page, and/or site on a global computer network, such as the internet.
IN CONSIDERATION OF the mutual promises and agreements hereinafter contained, the sufficiency of which are specifically averred to by each of the parties, the parties hereto represent, warrant, covenant, and agree as follows:
1.PURPOSE: The COMPANY agrees to allow the AFFILIATE, subject to the terms and conditions of the Agreement, to market the Products and/or Services to third parties on one or more web sites which are owned, managed and operated by the AFFILIATE (hereinafter referred to as the "Affiliate Site(s)"). The AFFILIATE agrees to devote and perform its best efforts to market the Products and/or Services of the COMPANY. These best efforts shall include without limitation, the design, creation and hosting of a customized web site and/or "storefront" in which the Products and/or Services shall be offered for sale. The AFFILIATE will also be responsible for advertising, promoting and/or marketing the Affiliate Site(s) and for directing traffic to the Affiliate Site(s). In exchange for the foregoing efforts and services and other good and valuable consideration provided by the AFFILIATE, the COMPANY agrees to pay the AFFILIATE a commission of _____ percent (____%) of the gross sale price of any of the Products and/or Services which are sold by way of the Affiliate Sites(s) or by way of any other direct or indirect referral by the AFFILIATE to the COMPANY. The COMPANY further agrees to pay the AFFILIATE ____ percent (_____%) of any recurring (e.g., weekly, monthly, annual) revenues charged by the COMPANY which are in any way related to the afore-mentioned sales. The COMPANY further agrees to dutifully perform all other activities related to the sale and support of the Products and/or Services. For example and without limitation, the COMPANY shall be responsible for all billing, shipping and handling, direct customer support, warranty services (if any), collection, and hosting services related to the Products and/or Services.
2.TRADE NAME(S):The Parties agree that the Products and/or Services may or may not be marketed and/or offered for sale under the trade name(s), mark(s) or logo(s) of the COMPANY on the Affiliate Site(s). Should the AFFILIATE in its sole discretion, determine that such trade name(s), mark(s) or logo(s) be used, the COMPANY hereby permits the AFFILIATE to use and display such trade name(s), mark(s) and/or logo(s) on the Affiliate Site in any reasonable and appropriate manner.
3.OTHER ACTIVITIES:This Agreement shall not prevent or otherwise hinder the AFFILIATE from licensing, distributing, offering for sale, selling, or marketing other products and/or services which are the same as or similar to the Products and/or Services of the COMPANY, nor shall it prevent the AFFILIATE from contracting with any third party in any manner and for any purpose desired by the AFFILIATE.
4.PRICING:The COMPANY will set pricing of such Products and/or Services according to its discretion and will notify the AFFILIATE of such pricing. The COMPANY further agrees to promptly notify the AFFILIATE of any changes in pricing of such Products and/or Services, so that the AFFILIATE will be able to make any appropriate corrections on the Affiliate Site(s).
5.OTHER CHARGES: The COMPANY agrees to pay any and all manufacturing, packaging and/or shipping costs incurred by the COMPANY related to the sale of the Products and/or Services.
6.PAYMENT TO THE AFFILIATE: Payment will be made by the COMPANY to the AFFILIATE promptly after each sale of the Products and/or Services and promptly after the sale of the Products and/or Services referenced in Paragraph One (1) and promptly after any recurring sales or revenues referenced in Paragraph One (1). Such prompt payment shall be made in a commercially reasonable time, not to exceed 60 days after such sale.
7.TERM: Both the COMPANY and the AFFILIATE may unilaterally terminate this Agreement at any time, for any reason, or for no reason at all. Written notice must be provided by the terminating party before such termination is legally binding.
8.INDEMNIFICATION: The COMPANY agrees to indemnify and hold the AFFILIATE harmless including all directors, officers, employees, and agents of the AFFILIATE, from and against any and all losses, liabilities, judgments, awards, and costs (including legal fees and expenses) arising from and/or related to the Products and/or Services provided by the COMPANY. The Parties to the Agreement desire and intend that this indemnity provision is to be construed in the broadest possible manner allowed under all applicable law.
9.NOTICE: All notices required or permitted to be given by one party to the other, under the Agreement, shall be sufficient if sent by certified mail, return receipt requested, to the Parties at the respective addresses set forth above.
10.APPLICABLE LAW: The Agreement shall be solely and completely governed by and construed under the laws of the State of Michigan.
11.CONSENT TO JURISDICTION AND VENUE: The Parties to the Agreement consent and agree that all legal proceedings relating to the subject matter of the Agreement shall be maintained within courts sitting within the State of _________. The Parties to the Agreement consent and agree that jurisdiction and venue for such proceedings shall lie exclusively with such courts sitting within the State of ______________.
12.NO WAIVER: The failure by either party to exercise any right provided for herein shall not be deemed as a waiver of any right hereunder.
13.ENTIRE AGREEMENT: The Agreement sets forth the entire understanding of the parties to its subject matter and may not be modified except in writing executed by both parties. The Agreement supersedes all prior oral and written agreements, proposals, and communications by and between the Parties.
14.RELATIONSHIP BETWEEN PARTIES: Nothing in the Agreement shall be construed as creating a partnership or joint venture relationship by and between the Parties.
15.CONSTRUCTION: The Parties agree that any construction to be made of the Agreement shall not be made on the basis that a particular party or representative of a particular party solely drafted the Agreement or a particular provision or portion of the Agreement.
16.ADVICE OF COUNSEL: Each party acknowledges that they have read and understand the terms, conditions, and provisions of the Agreement; that they have consulted and received the advice of counsel regarding the same or have had sufficient opportunity to do so; and that they have executed the Agreement freely and voluntarily.
The parties have executed this Agreement on the date first set forth above.
The COMPANY: The AFFILIATE:
The COMPANY further agrees to dutifully perform all other activities related to the sale and support of the Products and/or Services. For example and without limitation, the COMPANY shall be responsible for all billing, shipping and handling, direct customer support, warranty services (if any), collection, and hosting services related to the Products and/or Services.
Now that part of the agreement I really like. Query: Does that mean that any returns go back to the Company?
I only learned html -> then php -> css -> seo etc etc because I don't speak danish and my wife wanted to move here (she's a dane of course) and I'm sick of building clients sites!
All affiliate - all the time is my goal, and as soon as I acheive an reasonable income it's tiem we spent some time in England again ;) or Italy, Spain .... Ooooooohhh Yeah!
nowhere, I'm not sure where I lost you, but I AM an affiliate... I don't do anything else... that 1:6 ratio was on a fairly 'niche' affiliate site...high conversions/low traffic. It cost me $300 to build and in the 10 months its been up, I have never got a single email, I have done absolutely *no* work, I haven't even updated the site since it was built.... the only thing I *have* done is auto-collect the 2500 email addresses in my form manager that were submitted, and deposit the checks the company sends me in the bank... sound familiar? the difference between going the extra mile is higher conversions, harvesting the emails, and having everybody think that I'm doing all the work myself, which of course, I'm not:) Also, if I ever wanted to sell the site to a real company, all I would have to do is hand them over a client list, a 5 page website, and switch out one email address in the background. That's something that you can't do if you send the traffic somewhere else... that also means I get paid AGAIN on everything I've already done... so the only difference between me and you is that I like to eat cookies with my tea:)
...as far as my contract goes... glad some of you liked it:) ...that's for when you want to go after something so niche the company doesn't even have a contract for you to sign... so use it in good health.
I'm not sure I'm following the business model you're describing.
If I understand you correctly, let's say your site is dogboy.com. You are an affiliate for the merchant's site (if they have one) which is merchant.com.
If I'm following you correctly, when a customer comes to your site, they order at your site, from your site. The customer thinks they have ordered from dogboy.com.
Then you somehow relay the order electronically and automatically -- complete with credit card details -- to the merchant.com site who handles it just like the order came over the phone, basically -- the merchant packages the order, ships it, charges the customer's credit card using the details you provided to them, sends an invoice to the customer and handles any customer service issues, such as returns.
Merchant.com mails you a commission check much like you were an independent outside sales rep phoning in an order from the road.
Do I have it right?
If so, some questions for clarification:
1) Does the customer think they have ordered from dogboy.com or merchant.com?
2) Similarly, does the package the customer get say it's from dogboy.com or merchant.com?
3) Do you contact the customer after the sale in any way, or is the customer marketed to after the initial sale for any follow up or related items only by merchant.com?
4) You choose merchants who likely don't have an affiliate program per se; you may have approached them and worked out a one to one deal with them. Thus, you likely have few if any competing affiliates offering merchant.com's wares online (at least with high SE rankings).
5) You rely on search engine traffic rather than other marketing methods for traffic to dogboy.com. Basically, you do the SEO and site submission, then site back and see if dogboy.com produces for you.
Do I have it right?
Thank you very much for sharing; I'm new to all this...but learning!
Take care and absolute best wishes,
stlouislouis - you're starting to get the picture. Right now dogboy and others are riding the evolutionary wave of affiliate marketing. In fact, it's probably almost wrong to call it affiliate marketing anymore simply because of the connotation.
I'll share how my biz runs (not quite the same as some of dogboy's but it should help you)
1) I build a site about the product (5-10 pages) that includes product info, how to use product, prices etc. It looks like a stand alone site for that product.
2) When customers go to the order page they remain on my site, oilmansite.com, and fill in the order form on a secure server.
3) Once the customer submits the order the data is sent directly into my merchant's system - I could capture the data first but for this particular site I don't care.
4) After the customer has submitted the order they get a confirmation page that states at the bottom somewhere "Your credit card will be billed by somemerchant.com"
5) Now the data is in my merchant's system and out of my hands completely. The merchant handles customer service, order fulfillment, order tracking etc etc. I handle a check from the every two weeks.
It's a beautiful business model if it's done right. Basically what dogboy is saying is don't just build a site that says 'click here to order' and you can see a big ugly CJ or BeFree url. I'm not saying that won't work but I see the future of what I call "affiliate linking" dwindling fast.
heeheh, yeah oilman... you know me... not happy until I knock it down and jump on it a few times:)
stlouislouis, you got the basic plan.... I have a bunch of sites, each one is a little different depending on what we are talking about.... some are niche, some aren't. As far as merchant.com goes, these guys love me... in many cases I'm their number one affiliate producer ...and as long as I kick them big sales, they don't care what I do, and they do whatever I need. Don't get me wrong... I'm no poster-boy ...but I'm their backdoor man.
is it illegal? is it ethical? As long as 'surfer' doesn't get hurt, I say it's fair game... and while the Wild Wild West is coming to a close, it aint over yet... and they will have to pry my guns from my cold dead hands before I quit:)
keep the faith... I'm out of here
"I see the future of what I call "affiliate linking" dwindling fast."
My question is: Why? What are the reasons as you see them?
I've thought about possible reasons. Are the following on target?
1) Too much competition from too many affiliates selling the same exact thing; there are only so many spots on that first SERP, after all. Profits get split up too many ways among the affiliate universe.
2) Many merchants have poor online sites. Usability may be poor and get in the way of effective selling and closing the sale/order. An "affiliate" site that takes the order and never sends the customer to the merchant site at all, but just sends the customer's order details electronically after the sale -- in contrast to an affiliate that just passes the customer off to the merchant thru a link to a merchant site before the customer is sold -- can capitalize on a couple of factors:
First, being found more often than the merchant in search engines thanks to superior SEO.
Second, a much higher conversion to sales ratio due to both more effective marketing on a more focused site and the benefits of a site that's more usable and easier to order from than the merchant's site is likely to be.
3) The "new style online parter in marketing type site" avoids many problems *in getting paid* the more traditional affiliate link pass thru type site suffers from in the current and likely future business environment. Everything from not getting credit at all for legitimate sales made, to cookie expiration problems to whatever other problems are endemic to affiliates getting paid what they legitimately earn.
Moreover, under the new style model, each party does what they do best; one sells, the other handles order fulfillment. Since a solid order rather than a "unsold tire kicker" maximizes the value of what the affiliate/partner brings to the merchant, it makes business sense for the merchant to pay higher commissions or fees. After all, the affiliate partner has contributed more economic value to the transaction than affiliates just passing traffic that still has to be sold are bringing to the table.
Interesting, this sounds more and more like an online version of what happens in the physical world where sales reps sell products for companies and earn their commissions. It's not so much a new business done with "them 'thar new wiz bang computers" that hasn't been done before -- it's just business that takes place over a new, lower customer cost of aquisition marketing channel -- the internet.
New-style partner affiliates are using their online expertise to cut out the cost inherent in the physical world of a sales person traveling around client to client and making sales, or running a corner store competing with Walmart. They are also maximizing the value added of their SEO, marketing and selling skills -- and making sure they are getting paid fairly for what they contribute.
Is the above on target....or am I still off target in my understanding on what the future of successful affiliate/partner business models are likely to look like?
I really want to understand this stuff! It kind of calls to me....
Thanks for sharing, I appreciate it.
Take care and absolute best wishes,
AKA a newbie to all this, but learning.
It cost me $300 to build and in the 10 months its been up, I have never got a single email, I have done absolutely *no* work, I haven't even updated the site since it was built.... the only thing I *have* done is auto-collect the 2500 email addresses in my form manager that were submitted, and deposit the checks the company sends me in the bank... sound familiar?
Dogboy, I run my own shop and I have to admit that your description above sounds very tempting... I probably answer about 100 emails/day and I will happily admit that I would love to get rid of them! :(
1. I see a large portion of my work as being an investment for the future, when I am ready to sell the business. My goal is to stabilise my sales on a million dollar per year turnover for a minimum of 8-12 months, with a gross profit before tax of say $200k/year. I then figure I will be able to sell the business for 2-3 years multiple of gross profit, and cash out with half a million and do something else instead.
Now my question is this. Do you know of any affiliate sites that were doing extremely well that have been sold? If you do, what sort of multiple of earnings were those sites selling for? My biggest fear is building something so successful and profitable, and then not being able to sell it for a reasonable price. I am figuring that without a customer database etc. it will be difficult to sell, but you seem to have taken care of that part? Let's say you were running an affiliate program for Amazon.com, (ok bad example but just take your average merchant), that were generating say $100k in affiliate income for you. How much do you think Amazon would be willing to pay for your site, instead of keeping you on as an affiliate? (If they weren’t interested originally you could always threaten to sell to a competitor to give them an incentive.)
We all know how volatile the SEO game is, and I am afraid that the "free ride" we have at the moment won't be here in 3 years from now, and I want to have sold out before then.
2. Don't you ever feel that the merchants are ripping you off? I mean if you generate $100k in sales on one of your sites and get paid the typical 10% affiliate fee, doesn't it upset you that the merchant is making $40k on those items, and you could have made 4 times as much if you made the sale yourself?
I think basically my question is; How close do you think you are getting to the merchants margins on the best affiliate programs? I would probably be willing to give up 5% or maybe even 10% to not have any work as you put it, (oh how wonderful...sleeping until midday! :)) but I wouldn't want to give up 25% or 30%... Or do you just move on to the next program, and figure that you will make more money from having free time to build more affiliate sites than you would from those extra 30%?
Just to throw one more thing into the mix, we are now going to be manufacturing our products, it's a decsion based on adding margin and more importantly value to the business.
In your post above, you mentioned:
"We all know how volatile the SEO game is, and I am afraid that the
"free ride" we have at the moment won't be here in 3 years from
now, and I want to have sold out before then."
Being new to this, I don't know what you are referring to. Would you be so kind
as to elaborate, please?
Specifically, what constitutes the "free ride" now, and how do you think things will
be different in three years?
Thank you very much!
I have to disagree with you on this one. A niche is simply an area of a market that is focused and targetable. Just as the definition you listed from dictionary.com, ‘A special area of demand for a product or service.’ There are many, many of these in CJ. ‘A cranny, hollow, or crevice’ has nothing to do with the term, as I have used it here, IMO. (A physical name of a crack in a rock.)
>but out of the 100 people that came to your site, how many did you actually send?
If not close to 50%, you're likely doing something wrong.
>screw $2 a click, I want 50% of total sale!
Which is why, as Go60Guy has already mentioned, you have leverage as a strong affiliate.
When I am making 50% commisson, and new affiliates are making 15%, what is the difference between what you are talking about, and my affiliate site? About $2k in backend costs, and potential for other problems, from my perspective. Neither is perfect, both have advantages and disadvantages. As long as you can find something that works for you, great.
>When I stumble onto a site with a lot of tastefully placed text and banner links, that is a site that I call 'crap'.
Affiliates have a bad rep. With good reason, there are a lot of crap affiliate sites out there. I'd say there are probably 5% (or less) of all affiliates using true methods and building decent, legit sites.
Your definition of crap may not be someone else's. Were you looking for info on a product/service? Were you looking for the best price on it? Maybe you aren't the typical surfer on this topic? Sure, there may be 5-10% of the online population that never wants to see an affiliate site. Fine, I don't want them anyway, they aren't who I am targeting.
When I have people tell me "Man, I wish I had found your site before I spent my $ at someothersite.com," or they send me email saying "I wish you had one of those tell-your-friend thingys so I wouldn't have to copy and paste your .com address into emails to my friends" I know I am giving my visitors what they are looking for.
To be honest, I'm kinda glad most of the better SEOs look down on affiliate marketers. Less competition. :-)
All that said, I hope to start selling my own stuff soon. The beauty of being an affiliate in a niche before selling your own stuff is: you know the hows, wheres, whys, and some of the ins and outs. You definitely know how lucrative it is before investing any real money. Then when you do it on your own, you have a support site(s) already in place.
>you don't find these things in the top 100 list or on CJ... I'm talking about terms like 'mesothelioma' getting $50 a click at overture...
Would love for you to share your methods for finding these.
Drastic, everything you said was right except I don't think you should have used the word 'niche'... simple as that. If you would have said 'Finding Good Affiliate Programs' you would have heard nothing but golf claps from me... but right or wrong, believe it or not, I have a ton of respect for this place ...and that largely has to do with the mods here. And as a mod, I'm going to hold you to a higher standard then just some joker.... so when you come up with a title about 'affiliate programs' and 'niches' that is what I expect to to talk about... not building real companies... not about generic 'big search' programs.
...and just for the record, I used the word 'crap' to pull the few of you out there, who know how to do it right, to come out, guns blazing, and speak up, so I didn't have to fight with a bunch of scrappy affiliates who missed the bigger picture about how to stay in the game for the long run. Maybe that wasn't polite, but I think if you really want to get somewhere, a little emotion and controversy draws out the real players to make their positions painfully clear so the newbies have a reference to formulate their own opinions.
That said, we may have to agree to disagree on what a niche really is.... but since this is your thread, and you responded, I'm not going to let this slide without a response... and after that I’ll listen to what you and the others think, but its time for me to move on.
...so ‘niche’ ...
> ‘A cranny, hollow, or crevice’ has nothing to do with the term, as I have used it here, IMO.
that's my point exactly... you didn’t use the word completely correctly because you ignored the true nuance of the word... it means a ‘void’ a place where nothing ‘is’... when you talk about ecological niches you are talking about a little tiny micro environment. An organism is termed ‘successful’ if it can find an unoccupied niche and flourish in the environment, no matter how small it is.... its a relative thing, not an absolute thing.... in terms of traffic, it can partially be defined by conversion rates.... if you were 100% successful you would convert 1:1... and if you cant do that, you are leaving the possibility open that another might be able to come up with a better system and out compete you. So in part, it also has a lot to do with competition... once a niche is filled by a bunch of different organisms it is no longer a niche... its a ‘general’ because its inhabitants apparently don’t need anything special to exist there.
...that was a pretty terrible definition, but I hope you see my point... I guess you could say, for example, dogboy found his niche in SEO by promoting ‘web hosting’, but I don’t think you can accurately call something as generic as web hosting a ‘niche’ because you are talking about a flooded market. Now if you said ‘dogboy made all of his money off building the first ‘black gay military’ site and little did anyone know there was a demand for that kind of thing, and he cleaned up because there wasn’t a single other site out there like it... then I think you used the term correctly:)
>The beauty of being an affiliate in a niche before selling your own stuff is: you know the hows, wheres, whys, and some of the ins and outs. You definitely know how lucrative it is before investing any real money.
>Would love for you to share your methods for finding these.
Honestly, I don’t too much niche stuff because I love occasionally hitting the big stuff and sitting around all day in my boxers hitting the ‘refresh’ button and watching the money flow in while I drink mimosas:)
but when I do go hunting, I stay far off the beaten trail and look for an area where there is nothing but brick and mortar and confused people wondering what the hell I’m talking about ....but interested in the fact that they can give this internet thing a try without forking out a single dollar.... that's when the branded agreement comes into play... no risk for them, and the only way I get paid is if I can ‘walk the walk’ ...and I’m ok with that. I love to gamble with SEO ...its more than a job... its an adrenaline rush:)
1. Who's handling the customer support issues?
2. How are returns handled, if the product is eligible for returns (which some aren't)?
3. Whose name goes on the packing slip to the customer?
4. What's to stop the merchant from taking the customers for their own after the first order is shipped?
Dogboy, You are speaking gospel. As an ex "confused brick and mortar guy" I can completely relate to what you are talking about. In the "real" world of retail, expenses tend to be calculated as a percentage of gross revenue. So typically, (but generally), a B & M operation will be in the ball park if appr 7-10% of gross revenues goes to rent or occupancy costs, and a further 3-5 % goes toward advertising. If I take that lesson to retailing on the web, and count my place within a SERP as advertising and rent, it presents me with a budget framework to work within in regards to hiring an SEO.
The industry that I operate in is a perfect example of a "niche" that is flying under the radar. Low traffic (in comparison to the big stuff) with high conversions and not much in the way of competition. There are loads of businesses like mine that are absolutely ripe for the picking with the type of partnership between marketer and retailer Dogboy talks about.
I've bookmarked this thread so I never lose it, I've based many of my short and long term goals on just this thread and the 'building' one ;)
Nice one dogboy!