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Mathematical Proof Affiliate Marketing Is Pointless

Discussion in 'Black Hat SEO' started by DocBrown, Jun 18, 2011.

  1. DocBrown

    DocBrown Regular Member

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    I?m going to throw out some figures here which I?m open to correction on but I think they are worth taking note of.
    Lets say you create a product ? an ebook with a sale price of $39. I?m taking the magic of making up as an example (no I?m not the creator of it). You create the ebook and then create a sales page for it.

    Now lets say you put it up on clickbank and I don?t know whats the normal number of affiliates you?d get to sign up to your ebook but lets say it?s 100. I could be completely over optimistic or under optimistic on this figure (someone might correct me on it).

    So you have 100 affiliates selling the ebook for you at the normal rate of 75% commission (this happens to be the commission rate for magic of making up). So everytime an affiliate sells your book, you get 39/4= $9.75

    So lets take 100 sales at $9.75. That?s equal to $975. Now, if you were to have sold the book yourself as the creator and without any affiliates, it would have taken you 25 copies to sell to get that $975 (975/39=25)

    So in other words, if you?re an affiliate marketer you need to set up 25 affiliate sites in order to be making the exact same amount of money as the guy who just went off, carefully researched and created an ebook. Now I?m not talking about just any old ebook you?d get made up for you at elance for $1000. I?m talking about spending 4-6months researching and writing the ebook.

    What I?m saying is that 1 carefully researched and written ebook is approximately equal to 25 quick cheap affiliate websites. The only difference is that the guy who owns the ebook is safe in terms of getting de-indexed by google (after all it?s just a sales page so SEO isn?t that important). The affiliate marketer on the other hand has to throw stuff at his sites such as UAW, scrpaebox etc to get traffic which run the very real risk of upsetting google and having your sites de-indexed by google some day.

    So if you spent the next 2 years writing carefully constructed ebooks (or whatever type of product you want to create), you might be better doing this rather than creating 100 crappy affiliate marketing sites which could be de-indexed at the drop of a hat as often happens to people on this forum.

    It?s often stated that the people who make the real money in IM are the ones who own their own products. Are my above calculations proof of this? And therefore proof that affiliate marketing is just a waste of time?


    Just my 2 cents. What do people think of my numbers?
    [FONT=&quot][/FONT]
     
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  2. businessbira

    businessbira Power Member

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    You are right. You've just made me want to create my own product.
     
  3. MarketerX

    MarketerX Regular Member

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    Hey, this is a pretty good point, but you are wrong...

    This doesn't prove Affiliate Marketing is useless, because if you are the creator of a product, you rely on the affiliates obviously. Without them, you just have a sales page and an ebook...right? :baby09:
     
  4. DocBrown

    DocBrown Regular Member

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    Fair point. And when an affiliates site gets deindexed - you never think about it but the guy who owns the product also takes a knock in income.

    Is getting 100 affiliates to sign up to your product realistic do you think. I know some products gets tons and tons of affiliates but i'm guessing others then get next to none. Can you check this in clickbank? The gravity number doesn't really tell you this.
     
  5. Ibeefaaa

    Ibeefaaa Regular Member

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    Yes, that's true.
    What is also true is the proven fact that you can make more money by selling a product than by producing it with the same amount of effort involved.
    I mean, there are cons and pros but as a producer, after you spent a lot of time and (maybe) money in research and investments you have to rely on your affiliates skills and hope that you created a good product that is going to sell.
    As an affiliate you run the risk of getting de-indexed and such but it worth the risk because of the financial return.
     
    Last edited: Jun 18, 2011
  6. facebookdude

    facebookdude Elite Member

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    Some interesting ideas but you're views are really misguided. You're missing a very important component, and that is your mailing list and the power of launches. With enough hype yourself can get a ton of sales without affiliates and well over 100 affiliates.

    Until you have actually launched a successful product then IMO your view means nothing. Of coarse making a product is better than affiliate marketing, everyone knows that.
     
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  7. SuperLinks

    SuperLinks Elite Member

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    You are missing the point that the affiliates are the ones marketing and proactively selling FOR you. Chances are those are sales that you would never get on your own. Maybe they have a highly specialized list and a single email blast gets you 100 sales in a matter of a day. Now multiply that by a dozen or so affiliates.

    That's the magic behind affiliate marketing, is the ability to scale your business without much input and effort from yourself. Obviously you can make more money if you cut out the middle man, but if that middle man has an audience its foolish not to give him a percent to advertise.
     
  8. MarketerX

    MarketerX Regular Member

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    I think the amount of affiliates you get for your product will depend on a few factors...such as...

    1. The Niche
    2. The name of the product itself
    3. The sales page
    4. The price of the product/the % the affiliate will get.

    But yes I am sure you can get over 100 affiliates for your product if you choose those 4 things very wisely...
     
  9. Nubian Ptah

    Nubian Ptah Newbie

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    Doc Brown...you're BLIND.
     
  10. DocBrown

    DocBrown Regular Member

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    Can you elaborate?
     
  11. wowhaxor

    wowhaxor Executive VIP Premium Member

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    True to an extent. It takes a lot of work to get solid affiliates for a product to begin. You have to be able to convert and market your product well to affiliates. I'd say 90% of CB publishers don't have more than 1 quality affiliate.

    If you don't have the experience and know how plus connections (you really need to actually be in the game for a while and know who the big affiliates are and cater to them with custom LPs, banners, etc.) to get the big affiliates on board you will make more money promoting other people's products.
     
  12. reinie

    reinie Elite Member

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    you have never launched or owned a product have you? or made any money being an affiliate for that matter?
     
  13. DocBrown

    DocBrown Regular Member

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    Not really. I've written an ebook and got some sales but nothing major. I'm just starting out.

    I'm just doing some maths tbh that's all (and i did say i was open to correction on the matter). Intelligent correction btw not someone telling me i'm BLIND etc etc
     
  14. Execute

    Execute Supreme Member

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    also remember that u don't get the full 25%, the payment processor also take their cut, for example clickbank its $1 per sale plus like 7.5% of the total cost so you really are getting less than u stated.

    however if it is a good enough product you should have way more than 100 affiliates, just make sure its a quality product and it should go far ;)
     
  15. wowhaxor

    wowhaxor Executive VIP Premium Member

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    Ya, its getting a little old. The last 1-2 years here all I see is theory from people that make $500 a month tops. What does that pay, your half the rent if you have a roomate? That's not a living and you are not an Internet marketer by trade.

    People really need to read more, post if you have a question but not start threads acting like you know how everything works if you don't, it misleads and generally fucks up those that take the correct approach of reading and researching trying to learn what to do.

    When I started here the people that posted were the people who made bank and had good first hand knowledge, not theory. I read a lot and asked questions when I had them and that's how I got to where I am now.
     
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    Last edited: Jun 19, 2011
  16. havingadabble

    havingadabble Regular Member

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    Hey Doc, interesting point but I'm at a bit of a loss at to how much weight it carries in practice.

    For instance, you can apply the same rationale to every physical item that's invented, researched, designed, manufactured, distributed and sold. More often than not the guy or gal who invented / designed / developed an item has very little (if indeed anything) to do with the sale of the end product. Usually because they little or no idea how to get a product to a mass audience.....

    Introduce the aff. marketers, folk who have spent years building huge opt-in lists and striking a good rapport with existing customers who already buy similar products. These renegade salespeople drive traffic that converts.

    I've not yet launched an online product yet but do have a number of offline products under my belt and from that experience I can safely say that commission only salespeople are a godsend.
     
  17. dizz

    dizz Elite Member

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    You are almost there but you look over that you are selling in mass.you as the writer want to get as many eyes on your product.So you get the affiliates to do this for you.

    Dizz
     
  18. senior

    senior Regular Member

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    Just try getting anywhere near 25% from a Real book publisher. You could do it all yourself and make it all... or could you? The same stuff you want $39 for will fetch $9 printed and you'll wish 25% was coming your way.
     
  19. volund

    volund Senior Member

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    So you are just starting out yet you start two threads that basically say that adsense and affiliate marketing are a waste of time and energy. I and many others on this forum will say you have no idea what you are talking about. There are some people here that make huge amounts of money as affiliates, pretty sure they do not think it is pointless.

    You really might want to consider doing a bit more reading a a bit less posting.
     
  20. sirgold

    sirgold Supreme Member

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    Everybody that states that if "not tested in practice then it doesn't mean much" is defying the common rules of logic. IF there were no misinterpretations or neglected points a math model would explain MORE than the pure empirical observation what happens in reality. All this IF the model has been formulated correctly...

    Now, the major issues with your reasoning are:

    a. time is a finite entity, and so is your creativity. If this wasn't a mistake (or a major neglected element) of your analysis everybody would be an entrepreneur and there would be no employees. Why working for someone else when you can make more with the same "good idea". Well I guess the key here is to actually have THAT good idea that works (or replicating one that does by evaluating all the drills and technicalities of that specific idea) and so forth...

    b. For me as an affiliate might be more simple and profitable to create (and sell) 25 websites in 25 different niches of products that I already know that are converting well, than creating a single, well thought, carefully researched and potentially popular product. That alone is not as trivial as per your hypothesis. And again falls back to the previous point.

    If you're able to create a successful product after another, of course it's better to create your products maybe hiring a team to spread YOUR own ideas. They might be recursively asking the same questions about you, though... And the answer is that you are able to create successful products and they are not, so -for lack of better skills- they're cool with what they do.

    But if you are a crappy marketer, publisher or your ideas are NOT so good, you know what? They'll end up making more than you in the same timeframe.
     
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