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The Traps With Affiliate Programmes

April 30th, 2009

The Traps With Affiliate Programmes

Affiliate Programmes are big on the Internet. Some are touted as being the way to earn money ‘while you sleep’. Some are outright scams and in this case you should go straight to
In Australia
Australia Competition and Consumer Commission or the Australian Securities and Investments Commission. Their web sites are at
http://www.accc.gov.au/ and http://www.asic.gov.au/
In U.S.A.
Internet Crime Complaint Center at http://www.ic3.gov/

However many are genuine business opportunities. But the emphasis must be placed on the word business. Viewing an Affiliate Programme as a passive addon to a web site is not a business decision: it’s a forlorn hope !

Any involvement in an Affiliate Programme needs to be considered as an addition to your business and should be a good fit with the nature of your business. You are essentially taking on an additional product or service. As well you must realise that you are selling on a commission only basis. That means no recompense for any costs associated with selling until a sale is made: no sales you still incur any costs.

The sad truth is that most Affiliates make very little or no money from these programmes. The Affiliate Programme owner does get the major benefit from their Affiliate Programme: the Programme owner is getting considerable publicity for their product/service that is featured on each Affiliate’s web site. As an Affiliate you essentially are giving them ‘free’ advertising. This in itself is OK if you are getting some benefit from the arrangement. This does not necessarily have to be a direct financial benefit e.g. commission but could be a goodwill benefit of being seen to be associated with a leading firm. But there must be a benefit for you WIITFM what’s in it for me.

Note also payment of commissions can often be a problem though not through any dishonesty of the Programme owner. Mostly there is a clause in the Terms that states that if commissions do not exceed a certain value per month then nothing is paid. As a consequence you make a few sales and still don’t see any commission.

Another problem applies to Affiliates who are in a different country to the Programme owner. The Affiliate Programme owners often pay the commissions by an ordinary cheque in the currency of the Programme owner’s country. The Affiliate then has to pay a high Bank fee to have such a cheque cleared and the clearance can take several weeks. Australian Affiliates often encounter these problems with American and other Affiliate Programmes.

So like assessing any business opportunity you meed to do the maths and ascertain if the proposal is worthwhile. It should be a good fit with your core business and you need to actively view the arrangement as an integral part of the business.

About the writer: David Berghouse helping Small Business use the Internet since 1995. Understand how to make the Internet and your web site work for your business.