Are Amazon Affiliate Rates Too Low?
Let’s face it, a lot of people complain about how low Amazon affiliate rates (4-15%) are when they justify why they don’t bother becoming or concentrating on being an Amazon affiliate.
They claim you can promote products from other affiliate programs, especially ones that sell digital products and you could earn 30% or more on each sale.
As a big fan of Amazon affiliate, I would argue promoting products on Amazon.com could be a good way to monetise depending on how you position your website.
Are Amazon affiliate rates really too low?
Yes, Amazon affiliate rates are lower than many other affiliate programs.
Even though the commission rate will increase substantially once you manage to sell certain number of items, it is still lower than many other affiliate programs.
However, you can still make good money with the right strategy.
Let’s define the website that we are referring here first. We are not talking about personal/general blogs because those sites are not focused on making money from affiliate marketing. For example, the blog you are reading (DigitalReadyMarketing.com) was not built to be an affiliate site, even though it has affiliate links here and there.
The kind of sites we are talking about are sites that solely focusing on generating money as an affiliate.
For example – http://www.knifeista.com/
You can clearly see this site has a lot of Amazon affiliate links and it was built solely to make money from affiliate marketing.
Now, let’s talk about strategy and how you can still make decent money with Amazon affiliate program.
1. You can create any kind of websites you want
With Amazon affiliate program, you have a wide variety of products to promote. You can come up with any kind of topics / themes and create 100s and 1000s of articles around them.
This means it is possible to create articles that can attract a lot of readers, if you know how to position those articles with low competition keywords. Even if you don’t, you could use Private Blog Network (PBN) to just rank for high search volume keywords and bring in traffic (note: I am not a big fan of this).
On the other hand, if you go with other affiliate programs, especially the ones with a digital product, the only thing you can talk about is that digital product. How much content can you actually produce around that one digital product? Probably not too many…….There are ways to get around that but that is not the discussion point here.
Considering the typical conversion rate of 1 to 2 %, this means the only way you can make money is to bring in a lot of traffic. So, most likely you will need to use PBN or paid advertising to achieve that goal because typical SEO strategies are centered around content creation.
2. Very high conversion rate
Generating high volume traffic is not an easy task. This is especially true for young websites and you would have to wait for a long time until you figure out how to bring in traffic.
This is a huge problem for many affiliate sites because 1 to 2% is considered a pretty good conversion rate. This means for those sites, making money has to wait and bringing in traffic needs to be the first priority.
However, if you are an Amazon affiliate, you could make money right way even with a little traffic. This is largely due to the high conversion rate that Amazon.com has.
Let’s do a simple math. Based on the real life data from the Amazon affiliate websites I have, in 2016 so far, the conversion rate is 6.46%.
Let’s say you only have 30 visits a day to your website. So in a month (30 days) it’s 30 visits x 30 days = 900 visits.
If you manage to send 2% of that traffic to Amazon.com, so 0.02 x 900 = 18 visits
Then 6.46% of that ended up buying something, 18 x 0.0645 = 1.16 purchase.
If this was a site promoting other affiliate products, it would have been 18 x 0.02 = 0.36 purchase, which means I would need about 3 times more traffic to even get one purchase!
3. You choose the product price
Based on the analysis we just did for conversion rate, you are probably thinking “wow, only one purchase, how much am I gonna make?”
Well, you can actually be in charge of that. Amazon sells a wide variety of products so you just need to pick the products with higher price.
High conversion rate + High price product = A lot of money
4. Amazon.com is here to stay
As I mentioned in this post, prior to 2016 I was experimenting with many other affiliate programs. One of the most annoying issues I had to deal with is when a business decides to stop its affiliate program. This happened especially A LOT with digital products.
Imagine how much efforts is needed to mitigate that issue. I now have a website specifically tailored to that one product and I have no product to promote.
So what’s the verdict?
Yes Amazon affiliate rates are low, but using the right strategy you can make pretty good money from it.
Do you disagree? Let me know in the comment section.
I build websites and use them for testing various SEO strategies and tactics.
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