What is affiliate marketing?

What is affiliate marketing?

By the end of this article, you will know what is affiliate marketing, why you should use it, and exactly how to use it.

There are tons of things I wish I knew when I started: building a website, raising prices, marketing skills, but these are all talents that can be developed over time. Yet, affiliate marketing was was so quick and so easy to implement, that I completely missed out on having extra money.

In fact, I just calculated how much I was losing per month, by not implementing this thing that takes 30 seconds. I missed out on $149.58 per month from August 2004-January 2012. For 89 months, I missed out on $149.58 per in monthly income, that’s a $13,312.62 mistake! That doesn’t even include that the income could go up!

It was 2012 when I first heard the term “passive income.” In my mind, “passive income” sounded a lot like when I sold Kirby vacuum cleaners door-to-door in college. It sounded like a total scam, like some new smoothie, energy drink, or women’s make-up. I wanted nothing to do with it, because it sounded like the opposite of what I was trying to do in my Traverse City counseling private practice.  Then I heard a term: “affiliate marketing.”

What is affiliate marketing?

First, it is not a pyramid scheme or anything close. Every business has a marketing budget. They spend it on everything from commercials, newspaper ads, magazines, online advertising, and email campaigns. What is affiliate marketing? It’s a way of targeting potential buyers that are most likely to buy a product.

With the changing world of technology, advertisers can have highly targeted ads. For example, on Facebook, I could run one ad for dads ages 25-32 with a college degree that live in Traverse City, MI. I could also run another ad on LinkedIn that targets mothers ages 30-40 with Master’s degrees and kids over age 10 that live in San Fransisco.

Return on Investment

As a private practice owner, you’re a business person. You may not know it yet, but you are! ROI or “Return on Investment” is a term to figure out how much of a return you’re getting on your investment. If you spend $500 on an ad in the paper and you get one client that comes 10 times at $100 per session, you have made $1,000 on the $500 investment. Thus, your ROI is 100%, so every $50 you spend you tend to make $50 profit.

So what is “affiliate marketing” and how does it apply to ROI?

The term “affiliate marketing” is when someone is promoting a product and in return, they get something. For example, if I refer someone to the hosting I use, BlueHost I get a small affiliate commission. The companies give this money because they can then spend less on marketing.

What is affiliate marketing doing to help companies?

Here are some reasons that companies give me, you, or anyone else money to promote their product:

  • We’ve gained trust with our audience (or at least should have)
  • It may get them into markets they couldn’t normally reach
  • It doesn’t cost them money upfront, affiliate marketing payments only happen when the product has been purchased
  • They can target customers that want to buy their products.

What is affiliate marketing doing to help counselors in private practice?

  • It’s a great way to increase passive income streams with products you’d already be recommending
  • It increases your professionalism if done correctly
  • It helps you to focus on content and tools that your readers need to know to improve
  • You can make money while you are sleeping

What you must know about affiliate marketing

In order to avoid the scammy, shady marketing, affiliate marketing must be done correctly. Otherwise, you’ll turn off your readers, potential clients, and just about everyone! So what are affiliate marketing best practices?

What does it mean to be an affiliate?

Webster’s says that “affiliate” means: “to closely connect (something or yourself) with or to something (such as a program or organization) as a member or partner.” So, to affiliate with someone is to partner. That business is an extension of what you do and you’re an extension of what they do. In my Traverse City counseling private practice, here’s how I disclose the affiliate relationship with Amazon:

 For those of you that can’t visit our Traverse City office and/or maybe you don’t want or need counseling, here are some great counseling resources.

 

The world is full of products and self-help material. We’ve gone through a bunch of it and have found what we think are the BEST RESOURCES. These are things that our counselors use and recommend all the time.

 

Thank you in advance for buying through these links.  The money that we get from promoting resources we use to help our lower income clients.  With that said, here is how we decide what we’re going to promote:

 

1. We we think it is awesome.

2. We would promote it even if  we weren’t getting paid.

3. It is easy to understand.

 

All of these products meet these three criteria. We’re also going to be writing reviews about what we think is great about the products, what populations they are aimed at, and how we want you to use them as you pursue mental wellness. Also, if you love/hate a resource, please tell us. If it has changed and is bad, we want to stop recommending it.

That’s how we explain affiliate marketing and how we use the profits. Which leads me to…

Be transparent with affiliate marketing

No only is it good practice, but the Federal Trade Commission (in the United States) requires it. The FTC’s Endorsement Guide walks through all the requirements. Basically, this is what they say:

  1. Endorsements must be truthful and not misleading
  2. If the advertiser doesn’t have proof that the endorser’s experience represents what consumers will achieve by using the product, the ad must clearly and conspicuously disclose the generally expected results in the depicted circumstances; and
  3. If there’s a connection between the endorser and the marketer of the product that would affect how people evaluate the endorsement, it should be disclosed.

Also, imagine if you bought something from someone you trust and then found out they were getting paid! Then imagine if this person was your counselor, whoa! Tell people how, when, and why you’re getting paid!

Make affiliate marketing natural

Earlier when I talked about my BlueHost affiliate relationship, of course I’d love if you sign up with them (I’ll tell you more about why later). But, it also added value to the article, it was a natural part of the conversation, and it’s something I really love! I’ve used Bluehost since the beginning of my private practice consultant blog, my wife just launched her Traverse City Occupational Therapy business using it (the site’s not live yet, but I’ll let you know when it is). For me, it would be a disservice to you, to not tell you about tools that make having a private practice easier!

So of course I’ll tell you what hosting I use, just like if a friend called me up and said, “How do you start a website?” I’d tell them all the same steps. I’d help with keywords, domain registration, and hosting. I’d also ask my friend to use my affiliate link, since it wouldn’t cost him/her anything more and it’s a way of saying “thank you for your help” to me!

Affiliate Marketing I do

As a counselor, you have to be careful about what affiliate marketing you focus on. I’m going to list all of the affiliate marketing I do and categorize them by the most appropriate for a counselor in private practice.

Affiliate Marketing Recommended in Private Practice

Amazon Affiliate Referrals: If you are recommending something on Amazon, such as books or really anything, you can have a picture, link, or “Buy now” button. You typically get 2-5% of whatever is purchased. So if someone buys all their Christmas gifts through your link, then you get 2-5% of all of that! It’s great for all of the resources you’re probably already linking to on your counseling private practice website.

LegalZoom: LegalZoom offers legal paperwork. If you’re working with folks that are starting a business, making a will, or something else, it’s a high quality option. My wife just filed a PLLC through Legal Zoom and it was really easy! You get 15% of whatever the person spends.

Affiliate Marketing not really recommended in Private Practice

Aweber: This is the service I use to create emails, manage lists, and create follow-up emails where they can be in order for the person. It’s super cool! However, asking private practice clients to pay to start an email list is outside of the purpose of why they’re on your website. Thus, there would be very few times I’d recommend this on my counseling website. However, if you were helping someone to transition into becoming a consultant, that’s where you could use it! They pay around a dollar month for each person you sign up. I have not completely figured out their payment structure.

BlueHost If you are setting up a website, this is the best hosting because of their customer service and the ability to have unlimited websites hosted! I have a walk through on exactly how to set up your own website. Like the previous one, this wouldn’t really apply to clients in a private practice, instead it might be for coaching or consulting clients.

NameCheap is who I use to purchase my URLs, they are so easy to work with when you’re setting up a website! Like the previous two, this wouldn’t really apply to clients in a private practice, instead it might be for coaching or consulting clients.

Affiliate Marketing never recommended in Private Practice

Google Ads: In the past I have a few ads through the website and these bring in a bit of passive income. Since my podcast interview with Sarah Barnes I’ve been doing none of this! It’s not really affiliate marketing, it is more direct advertising. It makes your website look terrible, so don’t ever do it on a counseling private practice website!

Bottom Line: What is affiliate marketing?

  1. Affiliate marketing is when someone promotes another business and their products in return for money.
  2. Affiliate marketing works best when the products recommended are relevant to the reader and the counselor/author is transparent about the affiliate relationship.
  3. Affiliate marketing is a way to make passive income (See my Monthly Income Reports how’s that for transparency!)
  4. Affiliate marketing is an extension of you, your business, and your reputation and should be taken very seriously

How is affiliate marketing working for you? Comment Below

private practice consultant headshot

Joseph R. Sanok, MA, LLP, LPC, NCC

Joe Sanok is a private practice business consultant and counselor that helps small businesses and counselors in private practice that are starting a private practice. He helps owners with website design, vision, growth, and using their time to create income through being a private practice consultant.

Joe was frustrated with his lack of business and marketing skills when he left graduate school. He loved helping people through counseling, but felt that often people couldn’t find him. Over the past few years he has grown his skills, income, and ability to lead others, while still maintaining an active private practice in Traverse City, MI.

To link to Joe’s Google+ .

Photo by Tax Credit

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