Starting a profitable online business in 500 dollars budget?
I am trying to put what i have learnt over past couple of years in series of articles – about fundamentals of Online Business and various aspects of Internet Marketing. If you are trying to a new online business like me, you will save a good amount research with these articles.
This article is first in series of articles about Affiliate Marketing – What is it, why is it required and how can one start an online business under 500 USD budget using primarily Clickbank and Affiliates Marketing.
The Affiliate and the Merchant
In online terminology, affiliate is like a Sales Manager for a merchant, who gets paid a portion of revenue when the Merchant is able to sell his product to a prospect referred through the Affiliate. So basically affiliate is a promoter of merchant’s products – product that may range from E-book to a dating site or any other service.
Why need Affiliate Marketing?
Affiliates based Business Model can be a highly profitable for both the merchants and affiliates. Today, Affiliates based Marketing is one of the most significant sales model for online businesses, and with time it has evolved to a perfection.
Why so? – Lets see what’s the “thinning-out” effect for an online business.
Say a merchant comes up with a product and puts it on a website for selling it. Product is ready good! Now how should he sell it. Apart from spending a lot of time and effort in development and support for the product, the merchant also spent a lot of money and/or time to achieve a significant position on the first page of Google or Search Engines.
Compare it to the off-line world, where a product company creates their own outlets for selling the product.
Still what is the chance that a prospective buyer may find him?
The chance is one in several hundreds. More than 80 percent traffic comes through Search Engines. Search Engines lists a website only once for a keyword, and for any keyword there are several hundreds or in some cases thousands of competitive listings. You may go through PPC, but still no search engines will not list you twice for the same keyword.
Not only this, think of the number of things the merchant has to take care of – from creating of product to single handedly marketing it. Think of the budget that is going to blow out, and the amount of time it is going to waste. Selling product this way surely needs some pretty good financing and a lion’s heart.
That’s what I would see as a “thinning-out” effect.
Now, look at the other scenario where the merchant just created a product and let others to promote it – similar to off-line world’s example of product companies and retailers. Retailers may be loosely referred to as affiliates in online world. If affiliates are able to make a sale they get a revenue share out of the sale, but if not merchant is not bearing the cost of marketing. Merchant is just responsible for taking care of the product and related problems.
More affiliates a merchant is able to make, more chances of a sale, since now his product is being promoted by several more listed pages for a Search Engine keyword or Sponsored List.
Affiliates may also have other unique ways to promote products – Email Marketing, Video Marketing or Social Media Marketing like Digg or Twitter.
So the bottom-line, using affiliates marketing you can sell a product in much less budget, much less time and much less effort.
Starting an Online Business under $500 using Affiliates Marketing!
Well! In fact it is a pretty good idea to try your hands at being a online merchant. You can in fact get to earn a pretty decent amount of money with a meager budget of $500 or lesser. Interested? Lets see what steps are involved in getting started.
First thing you need is a product.
How about creating an E-book on what you know the best?
You are not an author? Well! today’s sophisticated work division has made life easier for a lot of would-be millionaires. You can outsource the product development (say, E-book in this case) using a large number of available freelancers through freelancing websites like Getafreelancer.com and Elance.com. All you need to do is you can put your ideas in a neat and well-defined format, and put it on one of these websites.
I personally would go through Getafreelancer.com for outsourcing relatively simpler tasks like creating E-books. The budget may be between 100-200USD, depending on what is the quality of work desired.
You also need a basic website – a one-pager for describing what your product is about in details with a lot of sales pitch, lets call it a sales page. Website hosting can be purchased for as low as $2 per month at Hostgator.com or Bluehost.com – two of my recommended hosting providers.
Sales page – either you can write yourself or just outsource it again through one of the freelancing websites. You may get a sales page done in less than 200USD. You also need to accept payments. There are a lot of options however – a “paypal” merchant account should be sufficient for low-budget starters.
Having done this much, now you are ready with a basic product. Now lets see how to get to the affiliates, who can help you sell it. There are two problems here – First, how to get affiliates and second, how to manage those affiliates. Affiliates management includes tracking, accounting, and payouts – which is a significant problem in itself.
If you are starting with a low budget, the best way to solve both of these problems is to join an affiliates network like – clickbank and or, e-junkie. These networks not only provide the affiliates management part, but also give you instant access to hundreds of thousands of affiliates who are already selling other merchants’ products.
Well! this pretty much it, we are now ready to make money online within a budget much lesser than $500.
As easy it sounds and it actually can be, it is always good to get some more tips before you start on different aspects of Affiliates Marketing. I don’t see any harm if you spend a few more dollars in gathering more knowledge from some experts. In next few articles i will get a list of resources you may use for the same.
Tags: affiliate marketing, Internet Marketing, starting online business