The 1 Deadly Flaw of Affiliate Marketing

On the surface, affiliate marketing sounds like an ideal business model to make money online. However, you’ll find that the model has a deadly flaw when you look closer. Do you know what that flaw is? You better or it might cost you your life savings.

The basic affiliate marketing model sounds great on paper. There’s only three simple steps.

  1. Select an affiliate product to promote
  2. Buy traffic to send to the sales page

I’m sure you’ve all heard stories of affiliate marketers spending $10K a day to make $20K? It sounds great doesn’t it? Many people get into affiliate marketing thinking it’ll be their road to riches. Most will end up losing all their money because they fail to realize the one deadly flaw in affiliate marketing.

The Customer Doesn’t Belong To You!

When you make an affiliate sales, you get a nice flat commission for your effort. The only problem is that one time commission is all you get. What you don’t get is the customer. He belongs to the guy who paid you the affiliate commission. He will then go and sell additional products to the customer and you won’t see a dime of it, even though you were the one who brought him the customer.

Real businesses are built on repeat customers buying more and more stuff from you. How long do you think you can stay in business by using a business model that tells you to spend money on advertising to get a customer for someone else?

The Big Money Is In The Backend

Here is a secret to making money online. The big money is not in the first sales. The big money is in the sales after the first sale. The problem for you as an affiliate marketer is you only get paid on the first sale. Have you ever wondered why there are affiliate programs that pay 100% commissions? It’s because they’re making a killing on the backend, which they don’t have to share with their affiliates.

The backend income is the reason why successful affiliate marketers eventually develop their own products for affiliates to sell. My products include IM John Chow, Blogging with John Chow, WP Blog Videos, and Work From No Home. I pay affiliates 50% when they make a sale, and I am happy to do so because the customer belongs to me and I get 100% of the after sales.

The problem with creating your own product is it’s very time consuming and expensive. The sales letter alone for Blogging with John Chow cost over $10,000. Then there’s the video production team, the content creation team, the affiliate manager, customer support, server and affiliate software cost, etc. Unless you have a substantial amount of money to put up, and a well known brand/name, you’ll end up losing more money than doing just the affiliate marketing model!

Fortunately, there is an alternative model that combines the low start up cost of affiliate marketing and gives the same benefits of being a product producer.

Licensing The Rights To A System

Instead of being an affiliate of a product/system and earning only on the front end sales, you can license the product and own the customer so you get paid on all sales for life. My Online Business Empire (MOBE) is a perfect example of this.

MOBE has a normal affiliate program that pays 50% on their front end products. However, you can purchase a license and become a MOBE Licensee. As a MOBE Licensee, you get 90% commission on the front end and 50% on all backend sales. Most importantly, the customer belongs to you for life. Any future sales, whether made the next day or a year later, will result in a commission to you. It’s like having your own system, but without the $100,000 start up cost.

To give you an idea of how powerful this is, I like to share my personal case study. I am a MOBE Licensee. I purchased a license shortly after meeting Matt Lloyd (MOBE’s founder) at a mastermind in San Diego. In the first six month as a licensee, I made this much:


Unlike the Licensee Right program, MOBE has a normal affiliate program that doesn’t cost anything to join. If I was just a MOBE affiliate, and not a MOBE Licensee, I would have made this much: $12,238.75.

Do you see the power of the backend now? Do you see how much money you’re losing when you promote affiliate products that pays you on the first sale only? Wouldn’t you rather be a MOBE Licensee than an affiliate?

In many ways, MOBE is even better than producing my own products. Not only is the license so much less expensive than producing my own stuff, but MOBE has something that I don’t have. A phone sales teams. The phone team calls up my leads to offer them additional products and services, and I get 50% of all sales, for life. Imagine having your own phone sales team working for you. That’s what a MOBE License offers.

Want To Learn My MOBE Secrets?

I will be revealing how I made $128,804.40 in six month with MOBE at the Supercharge Seminar in Chicago on July 19 – 21. Tickets for this event cost $297 per person. However, Matt is offering free tickets to anyone who joins MOBE before Friday, April 26.

To get the free $297 pass to the Supercharge Seminar, you have to pay upfront for your MOBE License. While MOBE does offer a payment plan, it will not come with a free Supercharge Seminar pass. Buying the license upfront is definitely the best deal.

My Additional Bonus

In addition to the free $297 Supercharge Seminar pass, I’ve created an additional bonus package to make becoming a MOBE Licensee a no brainer. All John Chow dot Com readers who enroll as a MOBE Licensee between now and Friday, April 26 will receive the following:

  • A Brand New Apple iPad 4 (worth $499)
  • My original Blog Profit Camp program loaded onto the iPad (worth $597)
  • Complete Blogging with John Chow system with Automation Empire module and lifetime access to Blogging Done for You module (worth $598 per year)
  • Lifetime access to my WP Blog Videos training (Worth $1,164 per year)
  • A pass to the Home Business Summit (worth $197)
  • A review on John Chow dot Com to promote your product or service (worth $500)
  • Access to my Inner Circle Coaching program (worth $1,164 per year)
  • 2 hours of live coaching at the MOBE mastermind in Cabo San Lucas (worth $4,000)

That’s over $9,000 of additional bonuses. To get my bonus, all you have to do is enroll as a new MOBE Licensee.

Enroll In The MOBE Licensee Program

Then forward me a copy of your receipt. You must use the above link in order to show up in my MOBE control panel. If you don’t show up, I can’t send you the bonus. You will get instant access to the entire Blogging with John Chow system and WP Blog Videos. You’ll get the reminder of the bonus after the 90 day refund period. Even if you refund the license, you can keep Blogging with John Chow and WP Blog Videos as my gift to you. You have nothing to lose and everything to gain.

To find out more about MOBE and the MOBE Licensee Program, watch this webinar that Matt did showing how he scaled MOBE from $700/month to over $300,000/month in less than 18 months. He also laid out the plan on how he will scale to $20 million this year. Most of that money will be paid out to licensees.

Remember. The free Supercharge Seminar pass, and my additional bonus of an Apple iPad 4 and over $9,000 of my best products ends this Friday April 26, so take action now. I look forward to helping you with your MOBE business.

Enroll In The MOBE Licensee Program

39 thoughts on “The 1 Deadly Flaw of Affiliate Marketing”

  1. Marius says:

    Hi John,

    I am one of your new MOBE License team member and first I would like to tell you that there is a misspelling above… you said “That’s over $9,00 of bonuses!”, but I think it’s ‘a little more’ than that… 🙂

    Back to our MOBE business, I am back to town and I want to continue with MOBE. I assume the 90 days refund period it’s over, so please give me access to the bonus package with your Blogging system, WP Blog Videos and Inner Circle, because I want to build my blog and start promoting MOBE in my area by using your great blogging system (by the way…when you will send me the iPad with your Blog Profit Camp program loaded onto it?)

    Also when I enrolled you were offering to put $1,000 into a co-op to promote MOBE as a team with people who buy through you, do you have any news about it?

    Thanks for all your great support and motivation!


    1. John Chow says:

      Hey Marius!

      Would you like a black iPad or a white one? I’ll get all the other bonuses together for you. The co-op was a different offer. You can have the iPad or the co-op. You can’t have both. Since the co-op is over, you’re getting the iPad. 🙂

      1. Marius says:

        Okay, I like the white one… Thanks again John…

  2. John says:

    I am so grateful that I have your site John I am learning a lot each time I read your post. So can you help me make money?

  3. Hi again John

    I must admit to being somewhat puzzled about Matt’s famed Phone Room team that I read so much about in the publication ” IM Revolution” and also in ongoing publicity.

    I have been contacted via email by numerous MOBE licensees, (including yourself), over and over again daily and asked to opt in to MOBE.

    All that is ever asked in the Opt-In process, is First name ONLY and best email address, just like EVERY other email proposal one gets all day every day.

    So HOW and Where, – does the phone number request happen – and are ENOUGH – people commonly prepared to give it ? — I personally NEVER EVER give out my phone number on the RARE occasions that it is even requested on a Squeeze page. You are simply asking to be pestered, usually by people trained to hang on like Pit Bull Terrier and NOT let go.

    Matt is justifiably PROUD of the fact — that he will NOT – absolutely NOT allow THAT type of sales tactic in HIS organization. I sincerely believe him and I wholeheartedly agree with him

    As an MOBE licensee myself, Matt has NEVER taught us to request phone numbers, just the first name and best email – and fair enough too, OK.

    So JUST HOW does the famous “Phone Room Campaign” actually begin ?

    I – and I am sure LOTS of other people would really like to know also.



    1. John Chow says:

      You are asked for your full contact information when you buy something, like the $9.95 IM Revolution ebook. If you look at the order form, you’ll see it ask for your name, mailing address and phone number. The same goes for the Inner Circle coaching.

      The phone team doesn’t go to work until after the first front end sale.

  4. Erwin says:

    Hi everyone,

    MOBE is a great system but to start it you need some money and to build a list of customers is hard. You, John had a list of buyers before so it was easy to you but if we are starting from scratch it will be a lot of harder.

    But anyway thanks for this post.

    All the best

    If you need to know how to build list fast try this:

    1. John Chow says:

      No, you don’t need to build a list before you you start MOBE. MOBE itself is a great list building tool. My post yesterday on ordinary people making extraordinary income shows dozens of people who are successful with MOBE and they started with no list.

  5. Andreas says:

    yo!!this post is very informative, i have been burning out my cash with affiliate marketing will go for the license, i finally understand the power of backend products.

    1. John Chow says:

      Remember, you got until Friday to take advantage of the bonus offer. Welcome to the club!

  6. I. C. Daniel says:

    WoW “Additional Bonus” rocks everything this time. Best of luck John.

    Best regards from I. C. Daniel – Romania

  7. tom says:

    The Customer Doesn’t Below To You!? Does anyone proof read your copy?

    1. John Chow says:

      Thanks! I need more coffee!

    2. geekmom says:

      That’s what I like about John Chow, you know he’s not just some suit pushing papers behind a desk. Who needs a proofeader at 6 am??

      1. geekmom says:

        Or at 9 am… I meant proofreader. My r key sticks. LMAO

  8. This is an excellent explanation of an important problem.

    There always has to be something for something so I’m NOT surprised they require you to buy in if you want action on the follow up sales.

    This makes a lot of sense, I’m looking into MOBE now.

  9. Noble says:

    Thanks for the post. Please email information with the Chicago event details.
    Thank you, in advance.

  10. Cuzsis says:

    Ah! But if you have your squeeze page before the affiliate sales page you can pick up their emails. Then if you are promoting other products in that niche (granted that does limit you a bit) you will also have the “customers”. 😉

    1. John Chow says:

      True, and that is the proper way to do affiliate marketing. However, most affiliate just send traffic to the advertiser’s sales page. I call it hit and run marketing.

      1. Cuzsis says:

        Thanks John! Your reply heartens me, as I have only just gotten into Internet Marketing this month!

        I have been doing lots of reading around the web (and your site of course!) and it’s encouraging to hear I’m getting some of it right! 😉

  11. Sachin says:

    What if we buy here from India? Are you going to send all the bonus to us as well?

    1. John Chow says:

      Yes, the offer is available anywhere MOBE operates. If MOBE is available in your country, then so is the bonus.

  12. Rupert says:

    Thanks John, Very honest article. I am amazed how difficult it is to get from that idea, to the the page on my website that I should be doing it on. You are also right that one has to pay people to do things for you. The internet is so vast, that it is in the realm of the word infinity. So easy to get lost in. One thing that makes it so hard, for me is, when I buy something, like Im John Chow, I feel that I must read every email from you, after that purchase. My thinking on that is, I might miss something on the course. Instead, it is you marketing something else. Again, my thinking is that you are telling me about this because it might be a part of this new course I am taking from you. At that point I do some research and loose time I could be working on the lessons for Im John Chow. This must be the “shiny objects” syndrome. Mobe sounds like a good business for some people, at the moment I am still trying to get my website set up, to move forward in, “Im John Chow”. Thank You

  13. Franklin says:

    If you are a normal MOBE affiliate member can you still become a licensee afterwards?

    1. John Chow says:

      Yes, you can become a licensee anytime. However, any backend sales you made as an affiliate would not be credited.

  14. faisal says:

    So now affiliate marketing is not as gold as before?

    1. John Chow says:

      Affiliate marketing, when done correctly, is still a great business model. Unfortunately, most people do it wrong.

  15. jess says:

    Hi Jon,

    Great post, just getting going in the whole internet marketing path. Have a long way to go, but have to start somewhere. Bookmarked your site and will be visiting often.

  16. jacob says:

    John i don’t have the money to go all in, and pay $597 per month to get a license… but i can start as an affiliate and make my way into a licensee….. but did i read write?… Matt will pay $40 per referred person / per month…. all one has to do is refer someone?…. here’s the quote
    “Earn $48.50 Each Month For Every Person You Refer To My Website”
    i spent money on Solo Ads, for another Opp… i think i’m gonna spend money sending leads to Matts site, i’ll definitely be able to pay my way for a license

    1. jacob says:

      “did i read right” — it should’ve been

  17. Joani says:

    Hi John!

    I just found this email, and started to watch the exciting webinar, but I have to work tonight (for peanuts!!!!).

    You mention that this offer and all the glorious goodies you offer are good until tomorrow… may I assume that is an all day offer until midnight so we have enough time to absorb, decide and register???

    With warm thanks,

  18. Joani says:

    Hi John!

    Thanks for the email this morning! Cleared up my questions about timing today! I was hurrying through the material yesterday and missed the info.

    We are so excited to watch the full webinar today.

    Enjoy a lovely day!

  19. Gaurav says:

    Missed it! :/

  20. Alex says:

    Great article!
    Thanks, John

  21. Steve G says:

    Hi John,
    I always look forward to reading your post. They always contain a wealth of information for those of us who are trying to make money online.

  22. Greg Brown says:

    John Chow is the truth I have been watching you for just A little while now and I know you are one of the good guy’s. Are you by any chance attending No Excuses 4? If so I would ove to meet you and talk strategy. Continued success my friend.

    1. John Chow says:

      No, I won’t be at No Excuses. I hear it’s a great event.

  23. Kyle says:


    I have seen products like this from the time I made my first website in 1997. I wouldn’t have given this product a second look if I didn’t see you promoting it. All these programs look great and have testomonials (people trying to get sales). But the “1 Million” Dollar question remains: THE hardest thing to do: DRIVING LEADS. Driving business leads is extremely difficult and with tight restrictions from Facebook and high competition… many people buy this program and don’t succeed? ALSO: Does the $2000 Cost get your blow by blow on setting up ADS and exactly were to do it?

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