As an affiliate marketer, one of the biggest challenges is finding products or services to promote and advertise to others. Niche products can be the most profitable, as they generate the largest profit margin, but they can also cause you to fall flat on your face. However, the most important aspect you need to keep in mind when choosing products to promote is the actual nature of the said products. Basically, in the world of affiliate marketing, there are two major types of products: physical and digital.
Physical products and how they generate profit
One thing you need to know about physical products, as an affiliate marketer, is that they only generate up to 10% commissions, and hardly ever more. This means that you will need to sell very expensive products, or many of them, in order to ensure that you can make a living this way. While the refund rates are low, (which means that you will not have to give back money too often), they also tend to be harder to sell, as many times, people prefer to buy physical products from brick and mortar stores rather than the Internet, because they can see them and evaluate them with their own eyes.
Digital products and how they generate profit
Digital products, on the other hand, are more profitable. For instance, commission rates vary from 50% to 80%, a percentage that sellers of physical products cannot even dream of. Digital products present a lot of advantages.
For starters, the merchant does not have to store them physically, and the production costs are basically zero, once an original product was created. The digital copies can be delivered via digital download, so the only costs may be related to rented bandwidth from the hosting service provider and nothing else. This allows merchants to offer higher commissions to affiliates.
Also, it is much easier to sell such products online. After all, this is their natural environment, and it is normal for them to thrive here. People searching for digital products will always search for them on the Internet, and never in brick and mortar stores. Also, the usual lower cost of such products appeals to a larger audience that consumes such items at great speed.
An argument against digital products would be that the refund rates are higher. However, seeing that there are no actual costs related to refunds, this is not such a great drawback. Related to the volume of sales you can run, it is only a small cost you will have to pay as an affiliate marketer.
So, which one is better?
For affiliate marketers, the answer should be obvious. While physical products tend to be more expensive, you are bound to make less money trying to promote them, because of their production costs, and the fact that not everybody shops for them on the Internet. Seeing that digital products offer much more attractive commission rates, and you do not have to worry about having competition in the real world, you should go with digital products.
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Lina Stakauskaite works at Click2Sell (www.click2sell.eu) Affiliate Network. Click2Sell provides the opportunity to choose from the products which offer attractive commission rates. Moreover, Click2Sell offers tools to track all aspects of affiliate campaigns – visitors, sales, referrer sources, keywords that bring real sales. Sell products online with Click2Sell. Visit: (www.click2sell.eu)
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