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Why I Am Not An Amazon.com Affiliate

written by John Chow on June 28, 2007

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A few readers were surprised to find out that the Amazon.com link in my review of the 4-hour workweek wasn’t my affiliate link. Lewis Empire asked the following question in the comments.

Why aren’t you an Amazon affiliate? It looks like you could make a bunch from this referral. Any reason to stay away from Amazon?

There is no reason to stay away from the Amazon.com affiliate program. I don’t use it because it doesn’t meet my requirements for a good affiliate program. What are you those requirements? I’m glad you asked.

High Affiliate Payout

Amazon.com offers a base commission of 4% on sales and the average book cost $15.00. I would need to sell a lot of books to make any money at those rates. When I’m on the lookout for an affiliate program, the first thing I look for is the payout. Four percent of sale and a $100 minimum to receive a check would mean I need to sell 167 book at $15.00 before I can get a check (it’s $10 if you choose direct deposit).

Text Link Ads pays me $25 for signing up a new advertiser or publisher. That’s the same as selling over 40 books on Amazon. For this blog, signing someone up for Text Link Ads is a lot easier than selling a book because it doesn’t cost anything. This brings up point number two.

Free Is A Very Good Price

All the affiliate offers I deal with cost nothing to the readers. It doesn’t cost anything to sign up for a Google AdSense or Bidvertiser account. Studies have proven that conversions increases when the offer cost zero (yes, they actually had to do a study to confirm this).

When free is combined with a very high affiliate payout, the results can be amazing. My post featuring the Gold Business Amex pays $200 when someone signs up for the card. If you read the comments, you’ll see that at least four people have taken advantage of the offer. I’m sure a bunch more order up the card but didn’t make a comment about it. How many Amazon books would you need to sell to match that?

I may take on an affiliate deal that cost money to the reader if the payout is very high (like 50% or more) and is very targeted to my market.

Sell Exclusive offers

I highly doubt my review of the 4-Hour Workweek would have sold more than a dozen books because the book is available at any book stores. Amazon.com doesn’t have an exclusive on it. Because of the competition, price pressure is placed on the product which lowers the selling price and with it, your commission.

All the affiliate programs I deal with have an exclusive on their offerings – you can’t get it anywhere else. The rule to remember is: if you can get it at the local Walmart, it’s probably not worth promoting on the Net.

Passive Income Potential

I will accept a lower payout if the affiliate deal offers residual income potential. While the $25 payout from Text Link Ads is very nice, I would like it a lot more if they give a percentage of affiliate sales. My private affiliate deal with Kontera gives me a percentage of the volume generated by sites I refer to the network. The same goes for AuctionAds and AGLOCO.

Passive income is really the best type of income you can make. Once you lay in the foundation, you don’t have to work anymore for the income to keep coming in. All those sites I signed up will continue to generate money for months and years to come. If you can get your passive income to cover all your living expenses you become financially free. That’s a very good position to be in.

Highly Targeted Offerings

If you look at my Make Money page, you’ll see that every single offer is highly targeted to my blog. While Amazon.com does have books that are targeted to my market, the program fails on all the other requirements.

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