Affiliate Marketing: Pros and Cons

To start off, here's a video which offers a great introduction to the subject of how to make money online:

While it's by far not the only option, affiliate marketing is one of the most popular ways to earn money online. As explained in the video above, as an affiliate, you can direct visitors to particular offers or products and get paid if they decide to make a purchase.

The affiliate marketing model has it's advantages and disadvantages and I want to discuss those in further detail, below.

One of the major advantages you have as an affiliate is that you don't have to deal with many of the "headaches" that product creators and vendors have. Examples are: providing customer support, dealing with complaints and refunds, storage and shipping costs (for physical products), compatibility, bugs and updates (for software) and of course, having to put in all the work to actually create a product in the first place.

For hobby bloggers and webmasters, affiliate marketing can be a great way to generate some passive income. If you're discussing certain products on your website anyway and you have an existing traffic stream, all you need to do is link to those products with an affiliate link to make some money on the side. As something to add on to what you're doing anyway, this model is perfect.

For vendors and product creators, affiliate marketing is simply brilliant, because it's the best way to gain exposure and get a lot of marketing done for you at zero risk. Since you're only paying part of your profits, you never risk making a big investment and losing out on it, like you do with traditional advertising.

Having said all that, affiliate marketing does also come with a few disadvantages.

The greatest one of all is that far too many people get into this game with completely wrong expectations. Unforunately, it's not like you can simply create a small website and start earning raking in huge commissions over night. Even though affiliates generally have to deal with fewer issues than product creators, it's still a complex business that requires many different skills.

Another disadvantage of the affiliate model is that it can lead to many dishonest and misleading "reviews" and "opinions", concerning products. In fact, if a consumer wants to do their due dilligence and inform themselves about a product and that product happens to have a very attractive affiliate program with high payouts, it can be next to impossible to find honest reviews about it. Far too many affiliates would rather hype up any old product to get more commissions than be honest and warn their readers against low-quality products.

Finally, you need to realize that it's always more difficult to make a sale and build a "customer-base" as an affiliate than as a product-creator. It's not impossible, of course, but it does require more work and a bit more finesse to achieve the same kind of results as an affiliate than as a vendor.

In conclusion, affiliate marketing can be a very interesting and certainly a lucrative business model. As a vendor, you should definitely have an affiliate program for your products, as it really is the best risk-free marketing to be had. As an affiliate, you simply need to have realistic expectations and be willing to put in the work necessary to really see good results.