How to Grow The Balls For Bold New Campaigns
Here’s an important lesson for affiliate marketers:
The best time to launch a new campaign is when the last one is still making you money.
If you haven’t read it, Charles Ngo (Dr_Ngo) recently posted an excellent guide on how to make it in Affiliate Marketing. He raises a lot of good points, but none more so than this:
Affiliate marketing is very psychological. One important principle is what I call “money momentum.” Lets say you’re making $1k profit a day. If you test out a bunch of traffic sources and lose money, it doesn’t hurt too much because you’re still profiting overall. When money’s coming in, you can afford more risks. And some of those risks are going to pay off.
What if the same guy didn’t start launching new campaigns until his old ones die and he has no $ coming in? He’s going to get more emotional with the money loss.
There’s a lot of truth in this.
The easiest time to be laying down hundreds of dollars on new campaigns is when you have a buffer against the loss. It doesn’t have to be another profitable campaign. It could be the money that comes from your day job.
There are two reasons why I advise those making only ‘decent’ money from affiliate marketing to avoid chucking in their day jobs.
‘Decent’ money is not enough to guarantee your future success. Affiliate marketing is so volatile that you really need to have at least six months of living expenses in the bank before taking the plunge – more if you have a mortgage (or kids! …or a partner for that matter!).
The psychological advantage of having a guaranteed pay cheque will reduce the friction that is associated with churning out bold new campaigns. You will stomach greater losses than the affiliate marketer who has to conjure bread from his returns.
This brings us to an industry paradox.
The affiliate marketer who has other business assets, other sources of income, is likely to have much greater risk tolerance, and is therefore more likely to invest in bold new campaigns that open the door to rapid wealth growth.
Affiliate marketers who hang their entire careers in the balance by living pay cheque to pay cheque on skinny arbitrage margins… well, it’s easy to understand how they end up in a wheel spin, isn’t it?
They know that they need to gamble on bold new campaigns (and alien traffic sources), but their risk aversion prevents them from throwing balls to the wind and doing so. They can’t stomach the loss.
If you recognise these symptoms and can’t bring yourself to launch the campaigns that will springboard your career to the next level, here are the logical steps you can take:
Slash your living expenses and save more pennies for your campaigns.
Seek guaranteed stable income as your fallback – both emotionally and financially. This could be in the form of a part-time job, or in local clients that pay you a fixed monthly retainer to be their digital marketing whipping boy.
Use your skillset (e.g. writing, design, coding…) to earn ‘disposable income’ on freelance sites like Elance.
Focus on building web assets that generate traffic you don’t have to pay for.
Each option makes sense. Personally, I am a big fan of building my own web assets.
How much money do you spend on advertising? How much of the risk in affiliate marketing is associated with arbitrage? Building your own traffic source removes the stress of calculating and tracking margins. You can then reinvest your profits in to more scalable traffic sources without the emotional resistance to losing money.
What do you think? How do you deal with the risk of creating new campaigns on new traffic sources?
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Focus on building web assets that generate traffic you don’t have to pay for. This is the best way to…