Moe’s B2B World

Free iPhones for you and your family? Sounds too good to be true doesn’t it? The latest craze sweeping the internet is affiliate marketing, and it’s building up quite a head of steam. There are of course sceptics, but those who have been getting involved seem to be happy enough, and the affiliate sites themselves seem to be growing in number. They promise iPods, iPhones, digital cameras and PS3s to ‘members’ who sign up for a trial promotion, and get others to do the same. Are these sites for real, are they a scam and how can they afford to give stuff away for nothing? Read on and I’ll explain.

What is affiliate marketing and how does it work?

Affiliate marketing is a clever way to get people to sign up to what you are offering. The most common form is google ads which appear as hyperlinks next to the google search that you just performed. When these links are clicked, a commission is paid to the person hosting the link either when someone clicks on the link, or when they buy something from the site. Typically this is small, but in the case of many sites, they can be substantially higher.

How do these sites make money and still give away iPhones and PS3s?

Simple. if they persuade you to sign up to their site, and take out a promotional offer, and then persuade a number of people to do the same, then you are generating business for them. Sites like freebiejeebies and kudosnetwork (aimed at the UK, USA and Canada see below) structure their incentives this way. You sign up to the site, take out a promotional offer which is often free, and persuade a number of people to do the same. Once these have all been validated, you get your gift. But you only get credited when the people you have referred take out a promotion themselves. If you need 18 referrals and each of those 18 people need 18 referrals to get what they want, then the site has gained 324 customers. The next 18 from each of those 18 gives 5832 people, yet the site has only given away 19 iPhones. The numbers stack up very quickly, and as you can see, it makes perfect financial sense for them.

Advertising as we know it is changing form. This is one of the new forms. It is targeted specifically, and it involves you the consumer, doing the legwork, incentivised by the shiny techno-goodies they are offering you. It’s not technically ‘free’, it involves some time, one trial, and a lot of willing friends to help you over the line.

What’s in it for the middleman, the website owner?

Considerable amounts of money, of course. He needs you, however, to make the wheels turn – the reason he comes up with salivating prizes to get you off your bum selling on his behalf. You are charged with the job of working out which of your friends would be interested in such a scheme, and more importantly which of your friends wouldn’t, and you keep pushing to reach your goal like a salesman after his bonus (iPhone). Meanwhile Mr. Site Owner sits there taking a commission for every sale her gets, and passes on a residual to you in the form of your gift. His marketing is clever, and as you can see, he is doing very well out of it.

But wouldn’t they lose money by giving away iPhones to every person?

Theoretically if they gave away iPhones to everyone, then they might make a loss, but as is always the case, not everyone makes it to the number they need to get their free gift; only achieving a couple of referrals or none at all. They have contributed to the list of people signed up, yet have received nothing in return. It all balances out in the end. If it doesn’t, the number of referrals required per item goes up to reflect how savvy the customers are being, or how much revenue the site is receiving. In short they are not likely to lose out as long as the advertisers are happy, and as far as we can tell, they are.

And what about the advertisers? If everyone cancelled their free trials, would they not lose out?

It is possible that if everyone suddenly did complete all their referrals, that the site might temporarily be out of pocket, but they would raise the amount of referrals required to ensure that they are always making a profit. As you come at the bottom of the chain, you are the last to get paid, so to speak, so know that the sites always have cash, and that’s how they honour their contract with you, and give you your iPhone. Also remember, it pays for them to keep their reputation sweet amongst their agents (you guys), as without you and your clever efforts, they are nothing. Can they really afford to go around making promises they can’t keep? Not for long, and these sites are alive and well and have been for some time, so it appears they’ve got the balance right.

So does this affiliate marketing work?

Yes, absolutely, categorically, and for all parties involved. Is it free? Not completely, but if you are wily, it won’t cost you a penny, just some time and some clever thinking. Find a list of people want a new iPhone themselves, and get them signed up ASAP.

Examples of two UK based affiliate marketing sites for you to check out are: kudos network and freebiejeebies. Click on the links below to visit the sites. And Good Luck!

check kudosnetwork AND freebiejeebies for more information about how to start claiming your free iPhone. Also check thebestthings.co.uk for background information and to make your affiliate marketing more profitable.

This entry was posted on Saturday, December 19th, 2009 at 2:04 am and is filed under Business.You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.