In April of this year, just as millions of Americans were filing for unemployment and trying to figure out new ways to supplement their income due to the global COVID-19 crisis, the online retailer Amazon announced that it would cut affiliate commissions for a list of product categories–a big hit to many affiliate marketers and their revenue.
Changes Made to the Amazon Associates Program in April 2020
|Product Category||Previous Rate||Current Rate |
(as of April 21, 2020)
|Business & Industrial Supplies||6%||3%|
|Health & Personal Care||4.5%||1%|
|Lawn & Garden||8%||3%|
While the announcement of the Amazon commission cuts garnered most of the attention of affiliate marketing news sources, they weren’t the only commerce megaliths slashing rates. Earlier in the month retailers like Wal-Mart, Macys, Patagonia, and Victoria’s Secret halted their affiliate programs in light of coronavirus pandemic.
Amazon was one of the first online retailers to offer an affiliate program. Back in 1996, the company launched their flagship affiliate program, “Amazon Associates.” Affiliates received their payments via paper checks that were signed and sent via mail. Now, the program is much more sophisticated and makes payments to 180k affiliates. As Amazon’s program took off, so did other affiliate programs. Companies have shifted away from funneling money into ad budgets and rely heavily on traffic generated by affiliates. Currently, 81% of brands and 84% of publishers offer affiliate programs.
Considering the scope of the industry and its exponential rise, it would make sense that affiliate marketing provides substantial income for many around the world. It used to be that affiliate marketing was touted as a way to earn “passive income” or as a “side hustle.” Now, experts agree–there’s a definitive strategy to the industry and, while it may not be someone’s “nine-to-five,” if substantial energy isn’t invested, the returns will be slim to none. In the US alone, affiliate marketing is a $4.5 billion dollar industry and drives 15% of all ecommerce.
For affiliates, choosing an affiliate program, product niche, and offers to promote always comes with some inherent risk. Affiliates may put a lot of working behind promoting an offer that just isn’t resonating in its sales channel. Or, they may push an offer in a niche that’s about to experience a massive upset–for example, affiliates who primarily promoted travel-related offers are likely not very happy right now. While frustrating, these kinds of issues oftentimes create better affiliates who understand the fluidity of their craft and develop an ability to pivot and diversify.
When it comes to drastic commission cuts, the same resilience is required. Solopreuners and small businesses who rely on affiliate marketing for income must come to anticipate commission cuts and add variety their promotional plans. One way to do this is to diversify revenue sources and marketing promotions by exploring various affiliate marketplaces that offer a variety of commission rates and consistent payouts… like ClickBank.
How is ClickBank Different?
Similar to Amazon, ClickBank was one of the first companies to offer an affiliate marketing program. As a staple in the affiliate marketing industry since 1998, ClickBank has diversification baked into their affiliate program. Here’s how it works:
ClickBank offers products with commission rates that have been set by the seller–not ClickBank. ClickBank, as a company, never endorses specific commission rates or suggests commission rates to sellers. It is up to the seller to determine the correct commission model that works for their unique product or niche. Because of the variety of sellers who bring their product to ClickBank, sellers are highly considerate of what it takes to incentivize affiliates to promote their product. Therefore, the majority of commission rates for ClickBank offers are over 25%–with most between 40-75%.
This is so important because affiliates who promote ClickBank products in a particular product category (i.e. health and fitness) will never receive an email from ClickBank informing them that commission rates are being cut for an entire category. If a single offer is no longer appealing because of a slashed commission rate, there are more to be found in the ClickBank Affiliate Marketplace.
Sellers can change commission rates as they see fit, however, if an affiliate has built a receptive email list of following based on their niche, they will be able to promote different offers from various sellers who can raise and lower commission rates at their discretion–not at the direction of ClickBank. This creates a naturally competitive and diverse marketplace for affiliates to select offers from.
With over 30 categories and subcategories of products, offers that are consistently converting, and a variety of digital downloads and products with recurring sales, the ClickBank Marketplace all but downright prevents affiliates from pigeonholing themselves into the unfortunate position that Amazon has left their affiliates in–high and dry with no say regarding their livelihood.
Mitigate Risk by Adding Variety
Successful investors continually tout the importance of diversification. However, this wisdom does not only apply to investments. If you are an affiliate marketer and rely solely on one company or affiliate program for the primary source of your income, you are doing a disservice to yourself–especially if that company is in control of commission rates. According to Nick K. Lioudis, contributor to Investopedia and former deputy manager of Financial Investment News, diversification is about risk mitigation:
“Investors confront two main types of risk when investing. The first is undiversifiable, which is also known as systematic or market risk. This type of risk is associated with every company. Common causes include inflation rates, exchange rates, political instability, war, and interest rates… it is just a risk investors must accept. The second type of risk is diversifiable. This risk is also known as unsystematic risk and is specific to a company, industry, market, economy, or country. It can be reduced through diversification… Thus, the aim is to invest in various assets so they will not be affected the same way by market events.”
The same advice is relevant for affiliate marketing. There is always an inherent risk in marketing. But affiliate marketers can alleviate systematic risk in the same ways investors would: diversify, diversify, diversify.
Top Converting Offers on ClickBank as of June 10, 2020
|Health & Fitness||Yoga Burn||30%|
|Investment||Digital Success Network||50%|
|Health & Fitness||Lost Book of Remedies||75%|
|Health & Fitness||Diabetes Freedom||75%|
|Health & Fitness||Flat Belly Fix||75%|
|Home & Garden||Ted’s Woodworking||75%|
|Home & Garden||The Self Sufficient Backyard||75%|
|Self Help||Combat Fighter||75%|
|Health & Fitness||Custom Keto Diet||75%|
|Self Help||Make Him Worship You||75%|
CLICK HERE to sign up for a ClickBank account and get started as an affiliate.
To learn more about how to promote with ClickBank, CLICK HERE.