In an interview I’ve given for the Search Engine Journal (SEJ) — which went live earlier this morning, and may be read in its entirety here — I was asked one of the questions that new affiliates frequently ask themselves (and others too). The question was: “Which niches are more profitable when it comes to make money being an affiliate?”
As soon as the question was asked I immediately thought of (a) my What is the Best Affiliate Program? post, and (b) how widely-spread this misconception is — one that some niches are significantly more profitable for affiliates than others. Not too long ago, addressing a similar question in an interview to Website Magazine I said:
Some affiliates have been lead into thinking that there are “hot” products/niches in affiliate marketing (i.e. those that pay most money), but the real money is being made not on dietary supplements, or hosting. You want to (a) look at what is hot on the market at any given period of time, and monetize on those trend(s), but what is even more important: (b) establish yourself as a key player in the niche of your passion (be it music, shoes, Valentine’s Day, or anything else).
In my interview to SEJ, I expanded my answer adding a word about the importance of choosing your partners carefully, and also illustrating the importance of an all-encompassing approach to affiliate marketing analytics. Here’s that illustration:
… “profitable niches” should never be measured by the commission levels that are being paid by advertiser/merchant. Always look at the broader picture. Remember to look at such metrics as conversion, average order value, reversal rate, cookie life. For example, hosting companies have historically had high commission payouts (anywhere from $50 to $150 a sale, with select ones paying as much as $300-400/sale). Sounds attractive, doesn’t? Well, hold your horses before you spend all of your money on those paid search ads, or advertising on other types of properties! Hosting affiliate programs are also known to have some of the highest reversal rates in affiliate marketing history. While many affiliate networks will not disclose this piece of information to you, it is not unusual for a hosting company to reverse between 50% and 80% of all affiliate transactions… [more here]
Conversely, if you are selling a lower priced product/service through an affiliate program that pays a lower affiliate commission, but has a beautiful conversion ratio, and low reversal rate (some merchants even offer a “no affiliate reversals” policy), that will be your “profitable niche”.
Just yesterday I was looking through the stats of an affiliate program that sells a limited number of products based around one idea (in the health/fitness vertical), and because of (a) the publicity they’ve been getting lately, and (b) the highly targeted traffic they are receiving from carefully screened affiliates, here are the stats that program is now showing:
Pretty impressive, isn’t it? With their 15% commission and that 0% reversal rate, this would the type of program to partner with!
Stop dreaming of “profitable niches”! There is no good get-rich-quick recipe, just as there is no safe get-slim-fast method. Look for decent (ethical and caring) and well-converting merchants based on reputable affiliate marketing platforms, and when you find the one you want to try out, take it one step at a time. Don’t rush, learn from the mistakes, replicate what works, and cut off what doesn’t, and your success will eventually become predictable, and logical.