Does affiliate marketing work? Do the math(s)

I’m a sucker for get-rich-quick schemes, especially when they don’t work. Odd that. If you haunt certain communities such as the Warrior Forum, you will be overwhelmed by offers to make you rich within hours/days/months, These generally focus on affiliate marketing, and the model is usually thus:

  • identify some niche keywords, preferably without competition, or at least competition of a low grade; the usual starting point is the Google AdWords Keyword Tool, which gives a rough idea (possibly) of monthly search traffic for your preferred terms
  • set up a WordPress-based blog, and either cram it with themed articles sourced from desperate places such as Fiverr.com, or use auto-blog plugins such as WP Robot; and link these articles to products at Amazon, ClickBank or wherever in the hope of getting a small cut of any purchases there
  • work on the SEO of the site in the hope of reaching a top-10 Google search position.

Now, I’m not doubting for a moment that there are people out there who make thousands of dollars a month doing this. Many of them sell guides on how you can do it yourself by (in theory, at least) explaining what they do.

But.

Let’s do the numbers, which most of the guides I’ve seen (yes, I’ve paid for some of them, because I’m a sucker curious) gloss over. I present here a quick assessment of the factors which you need to multiply together to work out how much money you will make from your affiliate marketing scheme:

Monthly traffic

Different ‘experts’ vary in how many monthly searches they say the Google Keyword Tool should show to make a niche worth the bother, but they generally fall between 1000 and 10000 (and then there’s the issue of ‘exact’ search vs ‘broad’ search, where the latter is much more focused).

Google SERP (search engine ranking position)

Everyone knows you need to be on the first page of Google’s results – only obsessives (like me) go beyond it. The famously leaked AOL search data in 2006 supposedly revealed that 42% of people click on the top result (see here for more on this) but more recent and reliable data suggests the figure may be as low as 18%. All the surveys agree that even the 10th result gets only 2 or 3% of clickthroughs. Anyway, let’s be realistic and say that if you get on the top page of Google, you should get from 2 to 20% = a factor between 0.02 and 0.2.

CTR (clickthrough rate) and conversions

The clickthrough rate is crucial: the number of people who click through (or ‘hop’) from your website, via your affiliate links (cloaked or otherwise – opinions differ on whether you should do that or not). It’s quite likely this will only be around 2%, maybe more, maybe less.

Conversions means the number of people who then, having reached the actual retailer’s site, actually go on to buy something. Let’s say 3% is typical. In both cases better is certainly possible – I’ve come across 30% CTRs, for example – but let’s assume you’re new to all this, and in any case err on the side of cautious. (Of course, different types of product tend to have different conversion rates, and CTRs will depend on how easy to use your site is and how well you funnel people towards the sale.)

Let’s put these numbers together as fractions and say therefore that CTR x clickthrough is probably somewhere between 0.0001 and 0.01.

Referral fee

This is the cut the retailer gives you for bringing them business. There are lots of different models, eg paying for new signups, per product and so on. Let’s assume a pay-per-purchase percentage, and I’ll focus on Amazon here – others pay better, but there are lots of affiliate gurus out there who say you can make a mint with Amazon because they offer so many niche products. Amazon pay from 4% (the starting rate) to 15%, but the latter rate is very restricted; let’s say in general a retailer will pay you from 4 to 12%, ie between 0.04 and 0.12.

Product price

Finally, there’s the price of the product itself – of course, you may link to many different ones, and again the affiliate experts have strong opinions. Obviously it’s tempting to go for high-ticket products such as plasma TVs, tablet computers and so on, but then fewer people are likely to buy them, so less glamorous, but higher-selling items might do better. Anyway, let’s say you’re most likely to find products between $1 and $1000.

Hatmandu’s amazing unbeatable affiliate marketing formula – make $$$s

So let’s put all this together. All of the above variables need to be multiplied together to reveal how much money you could make each month.

Let’s assume you want to make $30 a month from your website – not exactly an over-ambitious amount, surely? $10 of that would cover your domain name and hosting fees, leaving you a tasty $10 to spend on setting up another site in the same way, and $10 to SPEND!

Let’s assume you’re confident your SEO skills will get you to position 5 in Google, which about 4% of people will click. Let’s also assume that CTRs x conversions come to 0.0005 (ie about 2 or 3% for each, multiplied together), and that you get a referral rate of 4% as a new affiliate marketer. Put it together and you get:

MONTHLY SEARCHES x 0.04 x 0.0005 x 0.04 x PRODUCT PRICE = 30 or, simplified:

MONTHLY SEARCHES x 0.0000008 x PRODUCT PRICE

This means that to make $30, MONTHLY SEARCHES x PRODUCT PRICE needs to total 37,500,000.

Woah, that’s 37.5 million! So if you average a product price of $100 for your ‘greenhouse heaters’ or ‘cheap android tablets’ or whatever your lovely targeted niche is, you need to get around 375,000 monthly searches for your key phrase! Hm, that doesn’t sound very easy. Oh, and greenhouseheaters.com and cheapandroidtablets.com have both been taken, by the way – one by an affiliate marketing site and one by domain parkers. You’ll find one or the other is true of most niches you look for.

And there’s the rub: even if you can find a niche that’s free (they do exist, but they take a lot of work to find), the numbers don’t really stack up. Obviously you can improve your margins along each stage of the path:

  • Monthly searches: maybe there’s a niche attracting 100,000 searches a month that no one has spotted. Yeah, good luck with that. So really you’re stuck with the niches, or going for something popular… which is hugely competitive.
  • Google SERP: from 2% up to 20% is a factor of 10 (or 5 from our example) – if your SEO skills are amazing you could hit the sweet spot and get 20% of the keyword traffic.
  • CTRs and conversions: if you’re really focused you could get a percentage-of-a-percentage of around 1%, maybe even more. But it will take a lot of research and testing to find the right products and the right way of selling them.
  • Referral fee: the more you sell, the more this will go up, or you could target better-paying schemes than Amazon’s. But you can only really improve it roughly threefold.
  • Product price. This is the easiest one to change. Hell, yeah, let’s go for the $10,000 diamond-encrusted watch or a T-shirt hand-woven by Britney Bieber. I’m sure thousands of people a month will by one.

In the course of researching this, I tried looking up various .co.uk niche domains and found most were already taken. And take a look at this. These people have 1500 niche domains! Now, let’s say you want to make a comfortable, but not outrageous living of $80,000 a year. Add on top the $5000 you’d need to register, host and maintain 1500 domains, then divide by 1500 and by 12 months. Hey! Each site only needs to make $4.72 a month. You can give up the day job!

In other words, you can make a living doing this, but you’d need to find hundreds of available niches, and work hard to keep them all optimised and attracting focused traffic. Hang on, that sounds like a full-time job.

Animal words are strange fishes

I’m currently editing a book about a zoo. One of the things it’s drawn my attention to is the oddity of animal plurals. Discounting irregular forms such as ‘geese’ and pedantry such as ‘octopodes’, there seems to be a whole thorny area around what are known as ‘zero plurals’, where the plural is the same as the singular. There is a small list of canonical examples:

  •     deer
  •     moose (though I wish it were ‘meese’)
  •     sheep (disregarding Vi Hart’s proposal)
  •     bison
  •     salmon
  •     grouse
  •     pike
  •     trout
  •     fish
  •     swine

Our old friend Wikipedia says: ‘As a general rule, game or other animals are often referred to in the singular for the plural in a sporting context: “He shot six brace of pheasant”, “Carruthers bagged a dozen tiger last year”, whereas in another context such as zoology or tourism the regular plural would be used.’ This is corroborated in a PDF I found from the University of Granada (yeah, OK, not the leading source for English grammar, perhaps): “Nouns referring to some other animals, birds and fishes can have zero plurals, especially when viewed as prey: They shot two reindeer. The woodcock/pheasant/herring/trout/salmon/fish are not very plentiful this year.” And thanks to Colin Batchelor for pointing out that Eric Partridge (of Usage and Abusage fame) regards this as a snobbish usage by big-game hunters; and further that the Cambridge Grammar of the English Language (CGEL) includes the above words as ‘base plural only’, then elk, quail and reindeer as ‘base or regular plural’, and elephant, giraffe, lion, partridge and pheasant as ‘base plural restricted’.

(In the book I’m editing, the writer sometimes writes phrases such as “tapirs and capybara”, but has “tapir” as plural elsewhere. I imagine the capybara example is explained by subconsciously thinking that it is a Latin neutral plural. Doing a bit of crowdsourcing with Google reveals that for both animals the -s form appears far more in phrases referring to ‘two’ or ‘a pair of’ both types of creature, and indeed for the much-victimised pheasant, suggesting people do generally favour a simple English plural rather than the snobbery of the hunter.)

Andrew Carstairs-McCarthy’s Introduction to English Morphology expands on the ‘prey’ theme:

…there seems to be a common semantic factor among the zero-plurals: they all denote animals, birds or fish that are either domesticated (SHEEP) or hunted (DEER), usually for food (TROUT, COD, PHEASANT). It is true that the relationship is not hard-and-fast: there are plenty of domesticated and game animals which have regular -s plurals (e.g. COW, GOAT, PIGEON, HEN). Nevertheless, the correlation is sufficiently close to justify regarding zero-plurals as in some degree regular…

Hm, does “not hard-and-fast” really mean the same as “sufficiently close”? It’s not what I’d call a rule – more a matter of usage as Partridge suggests. And there are non-animal counterexamples such as ‘aircraft’ in any case.

And hang on, what about this buffalo madness from Mark A Wickens’ Grammatical number in English nouns:

Zero plurals

And let’s not get into the whole fish/fishes pond (Wikipedia: “Using the plural form fish could imply many individual fish(es) of the same species while fishes could imply many individual fish(es) of differing species” and so on.) Or indeed the other buffalo madness.

As far as I can see this is a grammatical minefield and nobody has a cleer steer. Or should that be bison. As for the book, I’m going to err on the side of English plurals with -s unless there is a compelling reason not to, such as a lexicographer approaching me with a blunderbuss.

Shaking spears at each other

To question, or not to question. That is to be…

A recent conversation at LiveJournal prompted me to revisit the whole ‘authorship of Shakespeare’s works’ malarkey. As I commented there, I had always been firmly convinced that the Man from Stratford wrote the plays, and found things such as Baconian ciphers preposterous (in fact, I even found one of the typical ones worked just as well with bits of Waiting for Godot...) – but seeing Mark Rylance’s play ‘The BIG Secret Live—I am Shakespeare’ made me much more doubtful. Such is the power of drama, eh?

Anyway, I’ve spent some time reading the (often venemous) claims of the Stratfordians vs the Anti-Stratfordians, if only to get my head round the actual evidence and what seems to make most sense. I find it hard to find unbiased summaries of the arguments, so I’ll at least attempt something like that here, albeit very briefly. I recommend this page at shakespeareauthorship.com for the Stratfordian arguments (HT to Colonel Maxim) and this free, new PDF ebook from bloggingshakespeare.com (despite it’s occasionally ad hominem approach – “Anti-Shakespearians … hardly smile, perhaps a characteristic of an obsessive mind.”). For the other camp, the only major work that isn’t trying to advocate for a specific alternative author is Diane Price’s Shakespeare’s Unorthox Biography – a useful page listing her 10 key criteria for what makes Shakespeare a biographical oddity also contains responses and counter-responses, which begin to sound like Woody Allen’s Gossage and Vardebedian. Another Anti-Stratfordian has posted a very useful chronology listing documents which reference ‘both’ the Man from Stratford and the Writer of the Works.

Aaaanyway. As far as I can see the main anti-Stratfordian points are:

  1. There is no  evidence of WS’s education (but of course absence of evidence is not evidence of absence, and at most one can simply say this supports neither camp’s argument)
  2. There is no direct literary correspondence with WS during his lifetime
  3. There is no direct evidence that WS was ever paid to write or that he received patronage (despite his requests of the Earl of Southampton)
  4. There are no extant manuscripts in WS’s hand (other than six shakey – hurr – instances of his signature, three on his will; and a much-argued-about Thomas More manuscript)
  5. There is no direct proof of his authorship during his lifetime.

The Anti-Stratfordians also like making a big deal over most legal (non-literary) documents spelling his name Shaxper, or Shackspeare, or various others without the middle ‘e’, while almost all of his works are attributed to ‘Shakespeare’ or ‘Shake-speare’ and similar variants. I don’t find this compelling either way as there are always counter-examples. I’m also ignoring the fact that WS’s will makes no mention of books or other literary matters, as this doesn’t prove anything one way or the other.

Back in the folds of academe, the Stratfordian case is supported thus:

  1. There was an actor called WS in the company that also performed the plays of ‘William Shakespeare’.
  2. The actor was also the WS from Stratford-upon-Avon. The chap from Stratford also had shares in the Globe Theatre.
  3. There is an abundance of evidence in the First Folio (from 1623, seven years after the death of the Stratford chap) that the playwright was the same man as the chap from the Midlands.

These three points are problems if you hold that:

  1. There could have been a conspiracy by actors and writers in the company to pretend the Stratford actor was also a gifted writer
  2. An interlineation in the Stratford man’s will giving money to two fellow actors was added later by someone else
  3. The only evidence during WS’s actual lifetime is circumstantial (true enough) and that a conspiracy (see 1) saw to it that the First Folio was a cover-up.

Mark Rylance, Derek Jacobi and others are behind a ‘Declaration of Reasonable Doubt’ about the author’s identity. I think in a very pedantic sense it is possible to say that it is possible to doubt that the man from Stratford wrote the plays, based on the admittedly unusually patchy documentary record. So they’re right there is ‘room for doubt’. But ‘how much room?’ is maybe the real issue.

Ultimately it all seems to boil down to two alternatives, and which one you find more palatable or least strange:

  1. A lack of direct evidence during the Stratford man’s lifetime for his authorship of the works
  2. A conspiracy of numerous writers and actors to maintain the cipher of ‘William Shakespeare’ as a cover for a person or persons unknown.

But as Charlie Brooker brilliantly expounded, all conspiracy theories rely on a triumph of paperwork over human reliability.

I’ve tried to be fair to both sides here, but I have to say I’m now back in the Midlands, as although (1) is at times troubling, and makes Shakespeare forever a man of mystery to some degree at least, (2) is just silly. I think. Probably.

In search of Colin’s Barn (aka The Hobbit House)

Colin's Barn

Some blundering around on the internet recently led me to read about an extraordinary place known as Colin’s Barn, or The Hobbit House (not to be confused with a self-consciously titled eco-home of the latter name built in Wales). I had to find it, so a small but intrepid band of us sallied forth to track it down. Briefly, it was built between 1989 and 1999 by a stained glass artist called Colin Stokes, on land he owned near his house in Chedglow, Wiltshire. He built it for his sheep. Apparently the council were not best pleased that neither Stokes nor his flock had been through the due planning process, and the stress of the bureaucracy may have contributed to him moving to Scotland. The ‘barn’ remains quietly dilapidating in a field.

There’s plenty more at Derelict Places but with care to keep its location secret. I’m not going to blab either, but suffice it to say (a) that it’s on private land, so tread warily and respectfully (b) despite what commenters at that site and others say, it can be found on Google maps, rather easily if you use your brain and (c) all of the stuff on these forums about rottweilers and security heavies appears to be twaddle. Or perhaps they are otherwise occupied on sunny afternoons. My only hint is to follow the horses and not the cars. (More photos at Flickr.)

Anyway, it’s a beautiful and amazing thing – and maybe the world is a better place for things like this being left dotted around in quiet corners.