How to Consolidate Markets, Expand your Empire and Diversify

June 12, 2012 - by admin · Filed Under Affiliate Marketing Articles Leave a Comment 
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    Something that I’ve slowly learned is how much money is involved in affiliate businesses in certain verticals.  In gambling for example, I’m sure it’s possible to invest $3k in a site ($1k in content, $2k in links) and then be making $1-$2k per month.  A strong, generic domain for a conversion phrase (e.g. bingosites.org.uk) would make the process even easier.  This is in contrast to investing $10k in a big content site (using Adsense) that barely scrapes $500 per month.

    Most Adsense sites will have an average CTR% of 1-2% from my experiences (assuming you’re not using one of those ridiculously optimized, Adsense themes with two giant 250×250 ads above the fold).  Even with a good CPC of $1, you’ll need 50k-100k/month traffic just to make $1,000/month.  This is in contrast to gambling sites which can make $1k/month with just 20/day traffic.

    My point here is that you can diversify, build huge brands with a large budget invested on content, but you shouldn’t stop doing what’s made you the most money in the first place.  If you’re a gambling affiliate with individual websites making you $1k+ per month then use that income to re-invest in your most profitable sites in addition to diversifying.

    It’s hard to give examples because I don’t want to be giving away all my ideas.  But, let’s say you’ve been making $3k/month targeting a niche like “CFD brokers” and CFD broker reviews.  Even if you sold that site for 15x monthly income (pretty good) it would still be worth your time re-building that site on another domain and earning the same income.  If you have first-hand experience of websites making this much money then it makes 100% sense to re-build it.

    This is what market consolidation is all about.  You don’t want to become limited in once specific market but if you’ve learned to monetize it effectively then you should keep re-investing in those types of sites.

    Tips for Consolidating Markets

    Everyone wants to diversify and build less “risky” sites.   But I think the truth is that the riskiest strategies tend to have the highest pay-offs.  It doesn’t make sense to just stop what you’re doing or sell up and just diversify.  You need to diversify wisely while picking up “easy money” where it’s available.  If you have $10k-$20 to invest in a brand site then go for it.  But speaking as a new affiliate, you need to grind away on smaller sites to get to this point.

    In terms of consolidating markets, here’s what I like to do.  Once you have a successful affiliate site making $1k+ per month with lots of operators constantly emailing you to be listed on your site, aim to sell fixed fee monthly listings.  I think it makes much more sense to negotiate fixed fee listings then bargaining over CPA and revenue share. If you can get fixed payment terms for 3-6 months on your site then you have guaranteed income (regardless of whether you lose your rankings in the short term).

    Now, if you’ve sold fixed fee listings on your site, why not build another similar site?  Mini-sites in gambling tend to have a huge ROI so you shouldn’t really worry too much about risk and SEO updates.  Even if a mini-site only lasts 6-12 months you’ll probably end up making a lot of money.

    The advantage of re-building money making sites is that you already have everything in place.  You have a good writer, you can recycle your previous SEO strategy and contacts, you can use your existing AM contacts to sell more advertising and build trust.  Etc.. You might even cut down your content/design margin costs if you’re sending over more work.  I’ve also had partnerships with businesses paying me up to $100/month  for homepage links, so it makes tons of sense to be feeding them with more sites in the pipeline.

    Whilst you’re doing this, also invest in bigger, long term projects.  Build big content sites and focus on email lists – anything that shifts your dependency from buying links and getting short-term rankings.  If you invest a certain proportion of your income in big content sites and high quality, natural links, over time your income should become less risky.

    In conclusion, don’t sell up too early on sites that have made you money in the past.  It sucks to be dependent on so-called “risky” sites but the only way to properly diversify is to build up enough income to investing in big brands.  If you get screwed by Google in the process of doing this then you just have to accept it I guess.  I guess you have to believe you can make enough money in the next 1-2 years to be investing in solid brands that are self-sufficient in the future.

     

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