Same product, different marketing

subway violinist

You might have heard of the “violin experiment,” some of which is shown in the video clip above. This event teaches us a lot about human nature, more than a simple marketing experiment, but the marketing lessons are valuable to all of use. So here’s the full story.

The experiment

On January 12, 2007, a man standing in the arcade just outside a subway station in Washington, D.C. started to play the violin.

He wore a T-shirt, jeans, and a baseball cap.  Over the course of 45 minutes, he played six pieces, including two by Bach and one by Schubert.

Because it was rush hour, it was crowded.  During his performance, cameras showed exactly 1,097 people pouring through the station, most of them on their way to work during the morning rush.

According to video footage, three minutes went by before anyone noticed at all. 

A middle aged man turned to notice the musician. He barely altered his gait, and then hurried to catch the next train. 

Thirty seconds later, the violinist received his first tip: A woman threw a dollar bill into his open violin case.  She did it hurriedly, like someone flicking a cigarette butt to the curb.

A few minutes later, another man leaned against the wall to listen to the violinist.  Three minutes later, the man looked at his watch and started to walk again.  He, too, had a train to catch.

The one who seemed to pay the most attention was a three-year-old boy.  He was in tow at the hem of his mother’s skirt, hurriedly being dragged along, the kid’s head following the violinist even as he was being pulled away.

Several other children had the same reaction. All their parents, without exception, kept the children in tow as they moved on.

Final results

In the 45 minutes the musician played, only seven people stopped and stayed for any length of time.

About 20 gave him money but continued to walk their normal pace. 

He collected $32.17.  No one applauded.

Only one person out of the 1,097 who passed through the arcade recognized the violinist, a concert performer named Joshua Bell.

She patiently waited for him to finish, then went up to say hello to Bell, one of the most celebrated musicians in the entire world, who had agreed to take part in this unusual social experiment. 

He had just played one of the most intricate pieces ever written with a violin worth $3.5 million dollars.

Three days earlier, Bell had sold out a theater in Boston playing the same repertoire.  The average ticket price for that performance was $112.

What to take away

People have drawn quite a few conclusions from this experiment, including how our appreciation of beauty is affected by context, perception, and priorities. More on some of these later.

For someone familiar with the three pillars of marketing, the main lesson is obvious: Your audience can make or break exactly the same product. That’s what makes the concept of an audience important enough to be a pillar in the first place.

You can look at the classical concert fans as the “right” audience and the subway riders as the “wrong” audience, but that’s a bit of an oversimplification. Let’s face it, many of those subway riders must have enjoyed going to classical music performances once in a while. And many of the concertgoers at Bell’s show must have commuted to their jobs on public transit. In marketing terms, you can’t make a comparison just by the demographics of each group.

So what else is going on?

Timing, that’s what. You’ve probably seen advertising in the media change its whole “vibe” before holidays, big sporting events, festivals and other events that most people get caught up in. That’s because businesses have learned which events impact them and how people’s buying habits change relative to the timing of the event.

Something similar is going on with the violin performance. The theatergoers have set aside both money and time to enjoy a nice evening of music. For the commuters, however, their driving interest is to get to work on time, so very few of them will be likely to stop and listen, even if they love classical violin.

The bottom line: timing is also part of your audience analysis. Your audience is likely to have different challenges and pain points at different times. It’s a good idea not to overlook that.

The other factor

Although audience is the most important pillar in this marketing experiment, our old friend trust plays a part here as well. Probably a number of people in that Boston theater had never heard of Joshua Bell until that night. Of course, some of the audience, must have, but otherwise, where would the trust have come from? The answer is that people actually trusted the theater, and the performer based on his association with the theater. After all, theaters are designed to create an emotional bond between performers and audiences. Subway stations are definitely not designed for this purpose.

The result was that commuters didn’t trust that there could ever be a good musical performance in the station arcade. So they assumed that the violinist could not be any good.

Conclusion

Making your affiliate marketing sound like concert-grade music requires a great deal of thought and planning. But if you take the steps – and time it right – the difference to your bottom line can be huge.

Affiliate Swim is a teaching site for online entrepreneurs who want to learn how to launch affiliate campaigns.

You can study our free affiliate marketing course in the Coaching section. For additional support, you can join our Facebook group for free coaching from experts and other students, as our time allows.

Once you launch your campaign, check out the store, which has many different nice-to-have items for most online entrepreneurs.

The downside to advertising

megaphone guy

I believe very much in the power of online advertising, but in reality, the downside to advertising is significant.

I’ve often heard new marketers say things like, “If only I had a multimillion-dollar ad budget, I could be as successful as Amazon.” Maybe some of you have been thinking this. If so, stop it. You can’t expect miracles from any advertising service.

In the online world, the downside of advertising of any kind consists of three disadvantages:

  1. Ads do nothing to increase the trust that your audience may have. (Remember how trust is one of the three pillars of marketing?)
  2. Everyone seeing your ad knows that they are going to be pitched. Although it’s still possible to build trust from this mindset, it’s harder than building trust from simple curiosity.
  3. As soon as you stop paying for the ad, it stops giving you traffic.

If you want to overcome these problems, you need to do two things:

  1. Optimize all your ads for profit metrics, and
  2. Develop as much of a base of free traffic as you can

Optimizing for profit

To generate a profit from your advertising, you as an affiliate need to be offering upsells that you know to be profitable. The other things you need are the major metrics from the advertising service, which are:

  • Your Click Through Ratio (CTR)
  • Your Cost Per Click (CPC)
  • Average value of a sale (probably from your vendor’s affiliate tracking software).

All this information is required when you want to calculate the ROI (Return on Investment) for your advertising spend, but it does not reveal the entire picture.

For example, you would expect a strong ROI to generate large volumes of traffic, have a high CTR, and a low CPC. That’s generally true, BUT many successful ad campaigns for high-ticket items end up having a smaller volume of transactions, a slightly lower CTR, and a slightly higher CPC.

The two most important things you can do after calculating profitability are to make sure that your user experience is clear, smooth, and engaging; and to make good use of your analytics software to track user behavior accurately.

Too much downside of advertising? Grow your free traffic!

The second part of overcoming advertising problems is not as difficult as it sounds, even if you are renting traffic to a sales funnel for your first offer, but free traffic demands free content, and that can be very time consuming.

The most widespread free content that small businesses use today is blogging, and that’s for a couple of reasons. First, an experienced writer can bang out a decent blog post fairly quickly, and second, blog posts are about the easiest thing to optimize for search engine keywords.

Of course, there’s nothing wrong with YouTube videos or podcasts for delivering free content, although they tend to take longer to create. They do support keywords for SEO, of course, but a text-based blog is able to take better advantage of these.

Another way to generate organic traffic, although it’s likely to be in small amounts at first, is through social media. Many people like to follow businesses on Facebook or Instagram, so it pays to make your presence known.

Affiliate Swim is a teaching site for online entrepreneurs who want to learn how to launch affiliate campaigns.

You can study our free affiliate marketing course in the Coaching section. For additional support, you can join our Facebook group for free coaching from experts and other students, as our time allows.

Once you launch your campaign, check out the store, which has many different nice-to-have items for most online entrepreneurs.

Competition in affiliate marketing

business-competition

Some would-be entrepreneurs are frightened off from affiliate campaigns because they believe there’s ‘too much’ competition in affiliate marketing. It would be easy to come to this conclusion once you figure out that (A) there is an extremely large number of affiliates practicing at any given time, and (B) nearly all of them fail. Both of these things are true, but they don’t paint an accurate picture of the level of competition in this type of marketing.

The first mistake that many people make is to compare affiliate marketing with other types of commission-only sales. We affiliates can promote as many products as we want across nearly every company and market space in all of e-commerce. Other commission-based work is almost always confined to just one company. This makes a huge difference.

Consider a car dealership, for example. There is a fairly fixed number of potential customers in the region, and a fixed capacity for the inventory that the dealership can have. With these limitations, only a small number of salespeople can be employed by the dealer and still make a good living. If the owner decides to hire every salesperson who wants to work there, then the pie of total sales has to be divided into even smaller pieces. Ultimately there’s no longer any point to working there.

That’s exactly what DOES happen with MLM companies and pyramid schemes, by the way. Because they serve only one market, that market becomes saturated while the company keeps bringing in new salespeople or recruits. The company’s revenue stops growing.

The competition in affiliate marketing does not have this type of constraint. There are tens of thousands of companies that support affiliate programs, either directly or through an affiliate network. These companies offer hundreds of thousands of products that can be marketed individually. There is no way the revenue pie could remain static for long.

stand out competition

Not surprisingly, the huge territory in e-commerce doesn’t have the same level of competition everywhere. Many market spaces are, in fact, full of competition, where others have almost no affiliate activity at all. Some people refer to these market spaces as “red ocean” or “blue ocean.” However, don’t make the mistake of choosing a market space only because it has very little competition. Remember that entrepreneurs succeed in hugely competitive markets all the time. All that’s required is a change of strategy. In a competitive market space, you have to differentiate yourself from other affiliates.

In the last analysis, you will be much more successful with a market space when you choose one based on how it interests you, not on how competitive it seems to be. For more information, refer to our course module on selecting a market space for your campaign.

Affiliate Swim is a teaching site for online entrepreneurs who want to learn how to launch affiliate campaigns.

You can study our free affiliate marketing course in the Coaching section. For additional support, you can join our Facebook group for free coaching from experts and other students, as our time allows.

Once you launch your campaign, check out the store, which has many different nice-to-have items for most online entrepreneurs.

Why affiliate marketing works

question marks

It’s not very hard to find explanations of HOW affiliate marketing works. It’s a straightforward concept, and there are plenty of articles and YouTube videos describing it. You’ll even find a quick explanation on our About page. What you have a harder time finding – from under all that hype – is an accurate explanation of why affiliate marketing has worked so well for a number of entrepreneurs over such a long time.

The problem

To understand why affiliate marketing works, you need to imagine yourself as a vendor. You sell products, services…anything, really. Now imagine that you make most or all of your sales through e-commerce. The number of vendors like you is growing all the time.

So how do you market your business?

Well, your target audience is probably online already, so naturally it makes sense to spend most of your marketing budget on online advertising, most likely Google and/or Facebook. But here’s where you can run into a problem. The cost of both these ad services keeps going up, and it might be especially high depending on your target audience. If you can’t raise the prices of your products significantly, your “best” sources of advertising could be eating into your return on investment.

The solution

Fortunately, there’s an alternative. One that’s been around almost since the beginning of e-commerce itself.

A great many vendors have discovered (or are now discovering!) that it can be much less expensive to recruit an army of affiliates when they’re paid only in commissions after each sale. Compare that to having to pay your ad service up front with no guarantees about performance.

The affiliates win, too, because they’re able to introduce almost anyone’s product to almost any audience, as long as the message is correctly targeted. And of course, their costs are minimal compared to almost any other type of marketing.

The bottom line is that affiliate marketing is not a crackpot scheme. It actually plays a major role in helping the online economy to function as well as it does.

Affiliate Swim is a teaching site for online entrepreneurs who want to learn how to launch affiliate campaigns.

You can study our free affiliate marketing course in the Coaching section. For additional support, you can join our Facebook group for free coaching from experts and other students, as our time allows.

Once you launch your campaign, check out the store, which has many different nice-to-have items for most online entrepreneurs.

Fear and Trust in affiliate marketing

fear-trust

Fear and trust are two of the strongest human emotions, and whether you like it or not, both of them will work within you during your journey to grow your business. In fact, one of these emotions is likely to determine your success or failure, as I’ll explain here.

If you’ve been reading this blog, you likely came across my article on the top mistakes made in affiliate marketing. These are primarily technical errors, or flaws in the design of affiliate campaigns. But believe it or not, none of them is the reason that most unsuccessful affiliates fail in their businesses. That primary reason for failure is entirely in their heads, and it’s – you guessed it – FEAR.

The way that fear affects a new marketer takes a very specific path, so you should learn to recognize the symptoms. You start out full of new knowledge and new hope as you put together your first campaign, and after careful, hard work, you launch your new campaign with a feeling of celebration. What happens then? Weeks go by with no sales, no orders, and not nearly enough people attracted to your site to create enough traffic for a sale. This is the point where fear sets in.

When you, as an online entrepreneur, experience this type of fear, you typically react in one of two ways:

  • You think this must be the end of the road. No email signups from ads, no friends left on Facebook. After a few weeks of staring at your screen in disappointment, it can be very easy to decide that your project is a dud. So, you throw in the towel and take everything down. Maybe you even give up completely on affiliate marketing.
  • You decide you need some quick fix to get the sales started, and you begin frantically looking online for a ‘secret’ way to make it happen. Of course, no such secret exists, so all you actually accomplish is to waste a lot of time and money.

The most powerful weapon against these particular fears happens to be trust, and in this case, trust actually plays two roles.

Maybe you saw my first blog post, where I said that trust is one of the three pillars of any type of marketing. Yes, it’s really that fundamental: there is no way to be successful unless enough people trust your business. A very small number of people might trust you fairly quickly, and another small cluster of people won’t ever trust you regardless of what you say or do. For the rest, it takes time to earn their trust, and some take more time than others. The main thing to remember is that, in the online world, nobody is going to stumble on a random person or business one day and trust them the next. Again, trust is earned, and earning people’s trust usually takes time.

However, in this business there’s more to trust than simply the trust you earn from your buyers. You also have to trust in yourself. Trusting yourself means being able to attempt all kinds of things – many of them for the first time – without judging yourself too harshly. Here are a few tips to help you build this kind of trust when it comes to your affiliate business:

  • Anything worth achieving takes longer than you might expect.
    Pride and appreciation can only develop over time, so it’s essential to learn to be patient. Keep moving forward and don’t become discouraged: there are no overnight successes.
  • It’s not complicated, so don’t overthink it.
    You don’t need to become the world’s foremost expert at a task just to get things done. Nor do you need to wait for someone to do things for you.
  • The path to success is never straight.
    You could find your business starting to branch out in several different directions, with many different customer segments. That’s actually a great thing, if you’re starting to make a profit. But it means that you’ll have a lot more to learn, and your trust in yourself will have to keep growing.

If you haven’t taken the plunge yet, go to the coaching section and study our free beginner’s course. And I’ll see you in the Facebook group.

Affiliate Swim is a teaching site for online entrepreneurs who want to learn how to launch affiliate campaigns.

You can study our free affiliate marketing course in the Coaching section. For additional support, you can join our Facebook group for free coaching from experts and other students, as our time allows.

Once you launch your campaign, check out the store, which has many different nice-to-have items for most online entrepreneurs.

Top ten mistakes affiliate marketers make

mistakes

Nobody is perfect; we all make mistakes. Unfortunately, making mistakes in business translates into losing money. Sometimes, a mistake won’t begin to cost money until after a while, so that you’ll have time to detect it and make corrections before things become too unpleasant. Other mistakes can cost you money almost immediately.

Whatever business you’re in, it’s always good to be aware of the most common mistakes that others have made. This article lays out most of these mistakes for affiliate marketing.

10. Expecting to get rich quickly

The only legal way to get rich quick is by winning a lottery. Sorry, but I don’t know how to do that.

9. First Offer commission is too low

The primary purpose of your sales funnel is to get people to purchase the first offer, so that your profits can come from the upsells. Of course, this means that your earnings on commissions for the first offer must match (or at least come very close to) what you pay for advertising. If not, you will need an upsell or two merely to break even, and that’s not a good situation.

8. Target market is too large or too small

Some marketers want to conquer all of e-commerce, but the fact is that not even Amazon has been able to do that. At the other extreme, a market that has only a few hundred buyers worldwide will never generate enough sales to make affiliate marketing worthwhile.

7. Over- or under-communicating with your list

For almost every audience, one email per day is plenty. Some people even prefer no more than one email every two days. This may sound obvious, but don’t bombard your list with emails: it gets them to unsubscribe, and you lose all those potential upsells.

Of course, the same thing can happen when you ignore your list. Eventually they will simply forget about you. At an absolute minimum, send at least 2 emails per week. Emailing more often will considerably improve the open and click rates.

6. Not running A/B tests

It’s well known that even a very minor change to a funnel page, a paid ad, or even an email can cause a major jump in audience engagement. Once you have enough traffic to do valid testing, you should be testing almost all the time. Let the data guide you, and the differences are likely to be a pleasant surprise.

5. Promoting products that are low value (for the price)

A lot of marketers promote overpriced, low-value items because of the short-term boosts to their profits. However, the long-term price they will have to pay is much higher. People will complain, unsubscribe, and delightfully talk down your business all over the Internet. It’s not worth it.

4. Relying on free traffic

This is a tempting route to go, but the tradeoff to paid traffic is that free traffic methods slow you down considerably, even to the point where there aren’t enough hours in the day to build a large enough audience.

To be fair, there IS one method of free traffic that does work: you need to have large amounts of popular content on your site. There are a few bloggers out there who have done extremely well with this approach, but the tradeoff is still present. Building this much content by yourself takes months, if not years. Or, if you hire assistants to build it for you, you would be paying them more than you would pay for advertising.

3. Not having upsells

Several new affiliate marketers make the mistake of thinking that, once they have a great funnel, they can sit back and watch the profits from their first offer roll in. This plan doesn’t work. Those who try it will lose money, or just barely break even. Profits can be achieved only with your upsells. Fortunately, you already have a list of people who are likely to be interested in many of those.

2. Not having a funnel

It amazes me how many people who just came across affiliate marketing actually BELIEVE that they can just stick affiliate links and banners here and there and expect the world to beat a path to click on them. This “strategy” doesn’t make a penny, of course, and it never will. No successful company attracts buyers without some form of sales funnel. It’s that universal.

1. Not having an email list for a specific market

I can’t say this often enough: if you don’t have a list, you don’t have a business. And it can’t be just any list, because you’re not a spammer. That’s why the first page of any online funnel absolutely MUST have a form for capturing email lists.


I hope you enjoyed this top-ten list. If you have any other top-ten ideas related to affiliate marketing, I would love to hear your suggestions: just drop me an email.

Coach Dave

Affiliate Swim is a teaching site for online entrepreneurs who want to learn how to launch affiliate campaigns.

You can study our free affiliate marketing course in the Coaching section. For additional support, you can join our Facebook group for free coaching from experts and other students, as our time allows.

Once you launch your campaign, check out the store, which has many different nice-to-have items for most online entrepreneurs.

Affiliate networks: what newbies should know

The best way to think about affiliate networks is that they act like a Tindr for the world of affiliate marketing. Although each network has its own niche or variation on the business model, all of them are in the business of pairing vendors with affiliates so that more affiliate sales get made.

How it works

  1. A vendor pays the network to be added to their database. The vendors then list products that they choose, the commission rates for each product, and any marketing tools that the affiliates might use (like ad banners). The vendor can pay the network a flat monthly rate, although there are many other types of payment structures.
  2. Affiliates join the network for free, although they are often vetted for other things, such as how much volume they’ve sold recently, or how much traffic one of their websites has. By the way, networks often refer to affiliates as “publishers,” because it has become so common for bloggers and other online publications to use affiliate ads to generate revenue.
  3. Any affiliate can request to advertise any vendor’s products. The vendor is entitled to say yes or no. Similarly, the vendor can contact specific affiliates and ask them to advertise the vendor’s products: again, the affiliates can say yes or no.
  4. When a vendor and affiliate have mutually agreed to market a product, the network automatically generates a link to identify the affiliate, vendor, and product (all encoded, of course). Whenever a potential customer clicks on that link and later purchases the product, the network records the sale and transfers the commission from the vendor to the affiliate.

Why it works

  1. The vendor wins because the cost of belonging to a network is less than the cost of developing and maintaining the vendor’s own affiliate program. And of course, both are less expensive than the vendor paying directly for ads in order to bring in more clients.
  2. The affiliate wins because the network is a convenient one-stop shop to find vendors who want to work with them. Also, a good network has vetted its vendors, so there is less risk of the affiliate not being paid the agreed commission.
  3. The network wins because it’s the type of business that can scale extremely well. There’s no limit to the number of paying vendors it can sign on, and no significant increase in overhead when more vendors join.

Should you join a network?

That depends on whether the kind of vendors they feature would be a good fit for your own goals. In any case, it doesn’t do any harm to belong to a network. You certainly don’t have to be exclusive to them.

Affiliate Swim is a teaching site for online entrepreneurs who want to learn how to launch affiliate campaigns.

You can study our free affiliate marketing course in the Coaching section. For additional support, you can join our Facebook group for free coaching from experts and other students, as our time allows.

Once you launch your campaign, check out the store, which has many different nice-to-have items for most online entrepreneurs.

Myths About Affiliate Marketing

Unicorn with hoodie

There is no shortage of misinformation about affiliate marketing, and believing it could easily cost you money. Here’s the truth behind some of the most common myths that are making the rounds.

Myth 1: Affiliate marketing is Multilevel marketing.

Not even close. It’s worth mentioning that network marketing (aka multilevel marketing) CAN be an honest, ethical business, but it tends not to perform well for entrepreneurs who buy into it. As a result, a handful of unscrupulous individuals who promote these business models try to conceal them by calling them “affiliate marketing.” Fortunately, there are some easy ways to tell them apart:

The Brand Overlord

Amway. MonaVie. Herbalife. Multilevel marketing ties you to one company, or even to only one product that the one company sells. And if the company collapses (as they often do), guess what: you’re out of work.

In true affiliate marketing, you are never tied to any brand. You are completely free to enter into affiliate agreements with any merchant on the planet that has decided to support an affiliate program. Not all of them will accept you, but many will, even when you’re just starting out.

Uplines, Downlines

Commissions are very different between these types of marketing, and in network/multilevel marketing, some of the payout systems are mind-bogglingly complex. MLM companies force you to share your commission with various people in your “upline” (who haven’t done anything to advance your business), and they promise you wealth beyond your wildest dreams from commissions earned by your “downline.” I think we all know where this kind of ‘model’ ends up.

In actual affiliate marketing, there is exactly one level: you, and the merchant whose affiliate program you’re part of. And the entire commission is yours, period. If you’re not sure about something that’s called affiliate marketing, this is the best smell-test you can use.

Myth 2: Affiliate marketing is complex.

Many of those marketing ‘gurus’ out there love to make this claim, because it makes it easier to sell their course or webinar, along with the attendant upsells. (Big surprise, right?) A few of these courses might even have useful information, but nothing that you truly need. The same goes for a number of software vendors who hawk expensive tools to solve all your problems as an affiliate. Again, some of them may be useful, but are far from necessary.

The reality is that the concept of affiliate marketing is about the simplest working business model in the world today. And there are really only two software tools you genuinely need: an email autoresponder for building trust in your audience, and a system for hosting the web pages that you use for capturing signups and doing ‘handshakes.’ Some marketers use a funnel building tool for that purpose; others use a web host and write the HTML themselves. There’s not much difference in cost between the two. True, there are plenty of other software products and subscriptions that can be helpful. They just aren’t necessary to keep your business going.

Myth 3: Affiliate marketing is passive income.

Many marketers who are actually honest will mistakenly use this term because it’s a cool marketing buzzword. Unfortunately, they’re not using it right.

In finance-speak, only two kinds of income exist: “earned income” and “passive income.” Any money you receive as a result of taking some action is earned income. That includes selling your time for a job that comes with a paycheck, along with income from a business you run, whether you’re the owner of a taco stand or the CEO of Apple.

True PASSIVE income, on the other hand, comes to you for no reason other than that you own a particular asset. This includes interest on a bank account, dividends from owning a stock, rent you collect from owning property, or royalties from owning the rights to a patent or a work of art.

So the bottom line is: there is no such thing as a business opportunity that provides passive income. Only certain kinds of investments can do that.

Final thoughts

I apologize for not blowing anything up like the Mythbusters, but hopefully I was able to clear up some of your confusion.

Affiliate Swim is a teaching site for online entrepreneurs who want to learn how to launch affiliate campaigns.

You can study our free affiliate marketing course in the Coaching section. For additional support, you can join our Facebook group for free coaching from experts and other students, as our time allows.

Once you launch your campaign, check out the store, which has many different nice-to-have items for most online entrepreneurs.