In today's class, we are going to explore a crucial aspect of affiliate marketing that often goes overlooked – the numbers.
Many people jump into affiliate marketing without fully grasping the financial potential and the calculations needed to achieve their goals. From the beginning of my journey in affiliate marketing, I've always focused on understanding what I need to do to reach my revenue targets, whether that's a thousand dollars a month or a million dollars a year.
Tasks for this Lesson:
- Understanding the financial potential in affiliate marketing.
- Learning to calculate revenue goals and required sales.
- Exploring the vastness of the online audience and the opportunities it presents.
- Set some financial affiliate marketing goals for your business
The first step in understanding the numbers is setting financial goals. It's essential to know what you want to achieve and how many sales of a particular product are needed to reach that goal. Breaking down these objectives makes them more manageable and easier to understand. This approach not only makes success more achievable but also provides a clear direction for your efforts.
Operating with a clear understanding of your financial goals ensures you're not working in the dark. This clarity is crucial because at the end of the day, most people start an online business for financial gain while pursuing their passion. I am sure that is exactly why you started building a business online as well!
By aligning your website and content strategy with specific financial objectives, you can work more effectively towards your goals.
Example: The Sandals Affiliate Program
Let's put these concepts into practice with a real-life example, the Sandals affiliate program.
This affiliate program pays 4% commission, which is definitely not on the higher end of affiliate commissions, but because it is geared around "vacations" worldwide, the average order size is much higher than other programs.
In this case, that order size is $1,250...and if you multiply that by 4%, you get an average of $50 commission.
Now if I was operating within that niche, selling vacations I would need ONE sale per day to earn $1,500 per month ($50 x 30 days = $1,500). If I wanted to earn $15,000 per month, how many sales per day would I need?
10.
Think that is possible with 5.5 billion people online, most of whom are travelling throughout the year, some MANY times. Absolutely, and that is the reality of the opportunity within the affiliate marketing world (and this is just one program).
Remember, the internet offers access to billions of potential customers. This vast audience is your market. Just a small fraction of these people daily can help meet your sales targets.
Another Example: The Vert Shock Program
Let's look at another example, that is relevant to my SkillFullBasketball.com website, a program that helps people improve their vertical leap (how high they can jump). This program is called Vert Shock, and it is on the Clickbank.com network which you have likely already familiarized yourself.
As you can see, this program pays $41.13 per sale, on average. Let's look at a breakdown of the potential earnings I could make from promoting this one program alone.
Let's look at a breakdown of my potential here with this program:
Sell 1 Vert Shock Product Day = $41.13/day, or $1,233.90 per month
Sell 5 Vert Shock Product Day = $205.65/day, or $6,169.50 per month
Sell 10 Vert Shock Product Day = $411.30/day, or $12,339.00 per month
You can see how quickly these commissions add up. With 450 MILLION basketball players in the world (all of whom are online), do you think I could find 10 of these people that and introduce them to a product that will help them jump higher?
I think so. And that is the very opportunity within the affiliate marketing world.
These calculations to ANY affiliate program. Commission rates will vary from program to program, some will be a few dollars, whereas others will potentially pay $1,000's in commission per sale.
With affiliate marketing you are tapping into a global audience, and you can do so with 100's of millions of different products/services. Understanding these numbers is key to setting realistic and exciting goals.
It's not just about having a passion for marketing; it's about strategizing for financial success...and I hope this has offered you a lot of clarity on that!
Tasks for this Lesson:
- Understanding the financial potential in affiliate marketing.
- Learning to calculate revenue goals and required sales.
- Exploring the vastness of the online audience and the opportunities it presents.
- Set some financial affiliate marketing goals for your business
