Forget the top payouts, best looking affiliate managers and networks with soaring reputations. For a new affiliate who’s just discovered profitability, cashflow is always king. It’s likely that to scale your business quickly, you’re going to need to make some sacrifices along the way. Handling your cashflow effectively is one of them.
No industry fills my ears with as many rags to riches tales as affiliate marketing. I don’t know if what we do is seen as a last gasp stab at financial salvation, or simply a popular way to spend your last 100 bucks. But many affiliates are faced with the challenge – even after stumbling upon a successful campaign – of being able to scale that campaign without clearing everything they have in the bank. Cashflow is the difference between riches and famine.
You’ve probably got a hundred different networks whispering in your ear, all desperate for your traffic. If you haven’t, rest assured this will rapidly become the case as you begin to earn more money. One of the biggest cashflow mistakes, and probably the easiest to make, is to spread yourself too thin.
In the search for offers that convert, it’s possible to end up sending dribbles of traffic to a dozen different networks. This normally results in you rinsing your bank balance, while not a single network sees you as significant enough to be paid weekly. When your bank hits zero, you’re left waiting on those dribs and drabs to be fed back in to your account by the various networks – many of which may be operating on Net 30 cheques as a form of payment.
Forget all the hype about the top payouts. It’s much better to be running a bunch of slightly less profitable campaigns on networks who can guarantee quick turnaround of payment. The quicker your bank balance grows, the faster you can scale. In an industry that changes overnight, you can’t afford to be left trailing in the dirt waiting on a bunch of cheques in the mail.
I read somewhere that a great idea for new affiliates is to invest in a credit card and blast your way to fortunes on the plastic. I can’t remember who said this, but they should be shot and hung out to dry. I can’t think of a worse idea than racking up a bunch of credit card debt on the principle that the “repayments are on their way”. The money isn’t yours until it’s paying for your groceries, so take “Pending Commission” with a pinch of salt and an eye on the worst case scenario.
There are circumstances where using a credit card to fund campaigns is acceptable. But you have to be in control of all the surrounding factors. Factors such as the quality of your traffic, the relationship with the advertiser and the exact promotional guidelines of the offers you’re running.
I’ve said it time and time again but by far the best way of managing your cashflow during the early days is to pick up free advertising coupons. I used to raid coupons for Google Adwords so that I could fund campaigns without having to compromise my own limited start-up capital. If you’re in the UK, snap up a copy of .Net magazine and you’ll receive a free Adwords voucher every month. Or go one step further like yours truly and simply rinse the entire pile in WHSmiths when nobody is looking.
That sounds incredibly trashy and unprofessional, but when I was getting started, I had little money of my own to reinvest. Coupons were like tiny Christmas presents to myself. Here you go, Finch. Have another Adwords account.
If you’re moving in to affiliate marketing from a wealthy background with money to waste, cashflow is probably a mere tickle on your balls. And in that case, you’ll find it a lot easier to succeed in faster time. Affiliates who have managed to build up healthy bank balances enjoy the luxury of being able to run campaigns on a lower ROI, and also work with the higher paying networks who refuse to pay any sooner than monthly.
Commission Junction, for example, is simply not a viable option as a newbie marketer investing in paid traffic. I enjoy promoting their dating offers because the ROI is nearly always higher than what I can achieve with a CPA network. But it comes at a price. That price being the need to float thousands and thousands of pounds on monthly payments. And the fact that you’re working with CJ, of course. A group of incompetent bumberclarts who should start addressing their support emails “Dear Mortal Below Us,” to show how they truly feel.
Another issue regarding cashflow involves budgeting in advance. Should you spend an entire monthly budget in a few days just because you’ve found a profitable campaign? Or should you split the advertising over a whole month? I would always say that if you find something that works, scale it ASAP and get the maximum bang for your buck while it’s on offer. From my experience, dividing your budget over a whole month can have the effect of dividing your workrate too.
Plus I find it’s a very good card to play on the networks you’re working with. If they see you’re sending a boatload of traffic in the space of a few days, and then that traffic suddenly dries up, they will sniff you out in a hurry.
“Hey Finch, I see you had some success with Offer X – how did it back out for you? What can we do to get more leads out of you?”
“Oh, well, I’ve got volume coming out of my arsehole on this one. But I’ve found a network that’s willing to pay me weekly on the same offer. So unless…”
And so you should be able to wrangle some weekly payments out of the equation very quickly. This enables you to refill that bank balance and get back in the game. The faster the turnaround on your balance, the more productive you’ll become and the faster you can scale. It really is a case of get money get paid.
Recommended This Week:
If you’re working in the dating market, check out Adsimilis. Definitely one of the better networks with a wide range of dating offers, all on high payouts, including lots of stuff in Europe and South America. I think you’ll like them.