Years ago, I cut my marketing teeth in affiliate marketing.  Many start out there.  I learned a lot in the early days of the “Google Cash Method”.  For the old timers, you may recall that the “Google Cash” (or, probably more appropriately, the “Amazon Cash”) involved buying cheap clicks on Google and driving them to an Amazon product.

The Amazon Assoociates program was the first really great affiliate program that allowed for scalability in products.  Plus, you were dealing with Amazon, so you knew you would get paid.

This method worked GREAT!  In ’04-’05, you literally could by some fairly good keywords for $.10-$.15 on Google Adwords.  Somewhere around 2005, it seems like everyone in their brother jumped in on this method and just killed it.  Suddenly, the clicks became unprofitable.  Do the math.  Pre-2005, if Amazon sold a $1000 TV, you pocketed (as the affiliate credited with the sale) 7% of that – or, $70.  To get there, you were buying some pretty targeted traffic.   The essence of this method was that you were buying model numbers.  So, yes, it was some pretty targeted traffic.  It was not outrageous to convert 7% on this targeted traffic.  (And, of course, this conversion rate greatly depended on the price of the product.  E.g, your conversions on a $60 phone would be much higher than a $1000 television, of course.)

So, ultimately, you were paying – let’s say $.15/click.  So, out of 100 clicks, you were paying $15.  So, you bought 100 clicks and converted 7% of those.  You can see how this method was lucrative.  Plus, I always found that hardly anybody ever JUST bought the thing they went to Amazon to buy – thus, contributing to the affiliate’s bottom line.

Forward the clock to the present day, you would get KILLED doing that.  Clicks have gone through the roof.  And, I don’t see that changing.  And, you can say “well what about Yahoo?  What about Bing?”… Sure, you can get cheaper clicks on both.  But, frankly, I have not found the volume there to even waste my time unless a campaign was particularly profitable and I had tested it in Google.

I spend a lot of time trolling the affiliate networks.  I look at CPA Networks but I also spend a lot of time studying Clickbank.  I have always found Clickbank to be a really good read on market trends.  Let’s go to the Clickbank Marketplace to examine where we are, today.

In the Marketplace, I typed in “abs”.  Then, I ordered the products based on “gravity”.  For those of you who don’t much about Clickbank, “gravity” is the measure of which products are really moving.  So, according to Clickbank, the top abs product is one called “TruthAboutAbs”.

Let’s get into the analytics of TruthAboutAbs.  Upon sale, the payout is $18.57.  But, there is a little continuity opportunity, as well.  At any rate, the avg. payout for a sale is $20.32.  Let’s do the math on this.  So, given… I have done some investigating and I also have some experience in this fitness niche.  You can get slightly cheaper clicks.  I would say that $.20-.30 is a moderately priced click in this niche.  (And, of course, you are going to have long-tail keywords that are paying less, of course.)  But, if you are spending $20 on clicks and pocketing $20 from Clickbank, it would seem to me that they only person who is profiting off of this particular niche is the product owner.  And, if you are making money as an affiliate, your margins are absolutely razor thin.

That’s why I have all but abandoned PPC affiliate marketing.  The example from TruthAboutAbs (I think) is very typical from what I am seeing throughout the market.  For example, go to Commission Junction.  Routinely, you will see EPCs (Earnings per 100 clicks) in the range of $20-30.  Tell me what kind of clicks you can buy to make that equation work.

Years ago, I knew tons of affiliates who were doing a lot of volume from PPC in Google, Yahoo, and Bing.  But, I think those numbers are drying up.  I had a conversation with an account manager at one of the larger affiliate networks the other day.  He indicated to me that – yes – few of his affiliates are actually having success with PPC anymore.  Really, the most successful affiliates are doing media buying.  So, it appears that we are going full circle, as a market.

I think that what I am seeing in practice online supports that conclusion.  Google almost any product and you are not seeing affiliates.  You are seeing the main product advertiser.  Gone are the squeeze pages and the landing doorway pages designed to drive you to the product page.  An affiliate simply can’t afford those clicks.

Yet, it kills me that there are still gurus and those out there that are pushing PPC as a reputable model for affiliate marketing.  I guess it is reputable … for them and their products!