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The Pitfalls And Permutations Of Joint Ventures, Defined
Affiliate marketing or joint ventures are term linked together nowadays, but there are subtle differences.
Affiliate marketing suggests a business relationship only, where both parties are distinct in their dealings, and are completely detached from each other. An affiliate marketer may never meet of converse with the owner of the product that is being sold, but the business relationship is set up so that the affiliate marketer receives commission from each and every product that is sold. That appears fine as there are many affiliates and product owners making a lot of money together, but somehow separate.
This relationship normally starts by the product owner posting his product on an affiliate site, the best example being "clickbank". An affiliate looking for products to promote will select a product by comparing it with many others, (in that site); normally within a particular niche or theme. They will choose that product on terms of how well they may think it will sell, how well it is selling and how much commission they are likely to take. This sounds easy, and many affiliate marketing eBooks make this sound simple and profitable; but there are many problems to overcome as you will find. Please read on.
Let is now look at joint ventures which suggest more of a partnership between the affiliate and the product owner. It suggests a strategy calculated between them, but the end result is the same with both parties making money.
Getting a joint venture started is slightly different, as both parties may know and support each other long before they work together; or they may meet somewhere such as a presentation or in a forum, where a rapport has developed between them, and the two agree of costs. Basically there is a communication and an agreement somewhere down the line between these two parties.
So which system is better? Well both have their advantages and disadvantages. An affiliate marketer may wish to work alone, and not want to meet or converse with the owner, or the owner has such a good product and business established that the newcomer affiliate may simply want to ride on the back of the product owner's success. This is a good way for an affiliate to start making money without owning a product. It is also a good way for somebody to learn the ropes of affiliate marketing. It is also a good way for an established product owner to become an affiliate marketer and sell other peoples products as a back end sale to their own product.
The joint venture way of working has similar advantages, but they tend to work together to produce some kind of strategy, to maximize sales. This is more powerful in the long run as there is always one person boosting the other. It is more difficult for a new affiliate marketer to establish a joint ventures with existing, established, product owners only really want established affiliates who know what they are doing, and know how to make money. The product owner's job become that of supporting the affiliate to make maximum sales; and the affiliate marketers role is to sell as many products as they can to both there advantage; in fact both work hand in hand. The disadvantage with joint ventures is the same with any relationships in that there is a danger of a falling out. As long as they are making money, all is well, but when the sales drop, or the money is unfairly divided then the partnership is vulnerable.
As mentioned above, and affiliate working on their own, or a newbie wanting to get started simply goes to an affiliate marketing site to promote a product to sell. They then either try and sell that product using their own established list, or they use that product to learn the ropes in the affiliate marketing business. However joint ventures are different in that the word partnership means everything to that relationship. They have to work together to mutual advantage. They may already know each other, but if they do not, how do you start a joint venture?
There are many angles to look at this problem, but let us look at the extremes. There is: the established product owner and the established affiliate; the established product owner and the newbie affiliate; the newbie product owner and the established affiliate; and the newbie product owner and the newbie affiliate.
1.The established product owner and the established affiliate.
This is where the relationship works at its best. When both parties are established both have reputations, and both are focused in earning money. One promotes the other, and the only concern is that there is money coming in, and the profits divided fairly. This is the relationship to aspire to, but getting established takes hard work, and years of practice and dedication to become successful; and focused in on making money. So how do you become established?
2.The established product owner and the newbie affiliate.
A good way for a newbie affiliate to start is by contacting the established product owner. If the product owner is smart, they will provide the newbie with tools to get going. There are many product owners who will to do this, and they do their best to encourage such newbie's, after all each sale is a win win situation. Many established product owners openly advertise for new affiliates with a view to training them, but although their sincerity is 100% there is still a steep learning curve; and the school of hard knocks to qualify. If someone says it is easy, or straight forward, do not listen to them as there is much work to be done to promote somebody else's product. There will also be an expense, although it can be minimize and within the newbie's budget; however if you are starting out, paying money for expenses not knowing when it will be returned, if it will be returned, is very discouraging, and this puts many possible affiliate off. In fact it could deter as many as 80% budding affiliates. This is the number one barrier to overcome; the not knowing if's and when's. If this deters you from becoming an affiliate, then you like me would ask the question; is there any other aspect to internet marketing that I could be involved in?
3.The newbie product owner and the established affiliate.
We are all advised all over the internet to create your own product as this is the best way to make money. Many established affiliates may disagree, but the general consensus is that you write your own eBook, or design your own software, or provided some other service. Again there are many sources on the internet to help you do so, and having my own product I will tell you that it is easier than you think, but it is still a lot of very hard work. Regardless, once a newbie has developed their own product, they need to bring that product to market, and that can be very difficult. They will need a web site, which is relatively straight forward, but the main obstacle for the newbie product owner is getting traffic; that is getting people to pay good money for that product. This is no mean feat, and the first thing to be done is to optimize the web site for the search engines, but this in itself still does not guarantee traffic. The next advice given could be to use adwords to promote their site to the top of the first page in say, Google. This can be very costly, however, if you manage to get traffic to your sales page, there is no guarantee that you will sell. In fact I have been told that a figure of 1% click through rate is typical, although this is on the low side. That is for every 100 people who clicks on your web site, only 1 person buys your product. You must then decide if it is worth it, remembering that you pay good money every time somebody clicks on your site. What is missing, well I would say, credibility? If knows you you are new, nobody, and they will doubt your product, even if it is the best product on the market. That then is where you need an experienced affiliate marketer to promote you, and promote your product. So how do you go about getting an experience affiliate? One place is the internet marketing forums, where you join and advertise your plight in the hope of somebody giving you the start you need. I must warn you however; this is not as easy as it sounds, as many experience affiliates want a product from a known product provider. This way they can promote a product without compromising their own reputation. So when you are trying to attract such an affiliate you must be very careful in the presentation of yourself and your product, and even then expect few takers. I know you may just want to get the ball rolling, but that is the hardest part for the newbie product owner, so be aware.
4.The newbie product owner and the newbie affiliate.
There are ways and means to get started, but if you advertise in a forum for an affiliate marketer to take up your plight, you may get requests from newbie affiliates. Do you accept them? My answer is yes, although do not expect much, and be prepared to teach and encourage them. If it all works out, then that is fine, but do not build your hopes up. Remember it will be the blind leading the blind. Now I answered yes to this question for a good reason. Many new product owners have worked very hard in creating a product, probably taking months of hard work, or even years like I did with "photofortune", but they have done so very much on their own. So for a newbie product owner to accept a newbie affiliate could be the start of a great relationship for the future. Both have much to gain and little to lose. Two newbies can hit it of, and create synergy to the next project. It is also great conversing with somebody on the same level, as they have much to share; both hoping for the break they need. It is great speaking to someone who has the same insights. You will find such a relationship great for sharing ideas, tools and strategies. Many successful internet marketers have many such friends whom they met when they were starting, and who now are on the same level of success.
Internet marketing through joint venture is easy to those who have done it successfully, but it is difficult to get going. As documented here, there are many ways of doing this, and many variations on the relationships of those involved. The goal is to mutually make money, and there is much to be made, but I think it is all about integrity and credibility. Get that right and you are onto a winner; that is once you understand the permutations that you could or should be involved in. Don't reach for the moon and expect it, reach for the moon, knowing you will at least leave orbit. Don't expect affiliates to jump at the thought of making money from your product because you know it is good; you have to convince them, and dare I say, doing most of the hard work yourself. Do not get somebodies product thinking you can sell it as easily as other affiliates do, there is hard work involved and some costs, remembering the super affiliates have many tools and friends at their disposal, that the newbie affiliate does not have. Don't reject a newbie who is offering you help, as that affiliate could be the answer to your prayers.
I have been through this whole process with "photofortune" and understand the pitfalls, which are many, but so are rewards. Stay focused, do not give up, and always keep your integrity high; to ensure and promote your credibility from the very beginning.
All the best.
Gordon McCulloch
A man's a man fur a' that.
