Monthly Affiliate Marketing Budget: $500
Monthly cost of affiliate marketing services / software: $450
Money leftover for running traffic: $50
If this looks anything remotely similar to your situation then you’re doing it wrong.
I know you’re eager to make money, and you want every advantage you can get. The right tool or service can save you time and money.
But you have to be careful not to go too crazy with the spending. You don’t want to end up in a situation where you barely have any money left over to run traffic.
Money is the gas that powers your campaigns. Not having enough money means you can’t buy the data you need to split-test your way to a profitable campaign.
And I know most of you are on a smaller budget and every dollar has to count. I’ve been there, done that. (Read my story The Rise of Ngo).
So now comes the question, what’s really needed? What are the bare essentials you need to start running campaigns? And when do things such as conferences, spy tools, and other services come into play?
I’m going to give you a list of services I think are essential. Find the right balance for you so you maximize each dollar you have.
Where Should I Spend My Budget? A.K.A The Essentials
First Purchase – Traffic / Money for Campaigns
Cost: No minimum or maximum
The Truth: You don’t need anything except traffic and an offer to get started in affiliate marketing. You could buy every $97-per-month tool out there and not earn a single cent.
The only necessary steps are to buy traffic from a DSP, Facebook, native platform or whatever, and send it to your offer at your affiliate network. Simple.
In general I recommend at least a $250 budget per campaign for traffic. The more money you have means the more variables you can test.
Second Purchase – Tracker
Cost: $99 per month for Voluum, Thrive has different options.
The only problem with the scenario where you buy traffic and send it straight to an offer is that you don’t know who is converting.
Consumers viewing your lander on iPhones may be exiting as soon as the page loads, but Android users might be converting at 25%.
In affiliate marketing we want to drill down into EXACTLY who is converting on your offer, and target our marketing to them. We aren’t branding advertisers.
The only way you can do this is with dedicated affiliate marketing tracking software.
I’ve seen guys try to use free methods like Google Analytics before for CPA marketing, and it always ends in tears. Using GA for affiliate marketing is like using a horse and cart to compete in NASCAR.
I recommend Voluum and Thrive.
There are other options out there, but those are the only two that I’ve tried and really liked. In the past I used CPV Labs and Prosper202, but I consider those platforms to be outdated.
If you don’t have a dedicated affiliate marketing tracker, you are throwing money / data away. Simple as that.
Third (and final) Essential Purchase – VPS Server
Cost: A solid VPS will cost you around $60 per month.
You’ve got a budget for campaigns, a tracker, and now you need a server. I hosted trackers (like Voluum/Thrive) that are on the cloud so you don’t need to host it on your server.
So what do you need a server for?
You need to host your landers, images, scripts etc somewhere. I use landing pages 95% of the time in my campaigns, so my servers are a big part of my architecture.
Here’s one question I get asked a lot: “Charles, should I get a Hostgator account for $2.50 per month?”
Shared hosting is a terrible idea for use in affiliate marketing.
In affiliate marketing, we’re sending thousands of impressions (up to hundreds of thousands) per hour. Shared hosting is meant for mommy bloggers and other small sites that get up to a few hundred visits per day. It’s also much slower than VPS hosting.
Who’s going to make more money?
Affiliate A with a landing page that loads in 0.2 seconds and has 99.999% uptime
Affiliate B with the same lander, but it takes 2 seconds to load and it has 98% uptime?
Page load time and uptime are critical to your success in this game.
A VPS (Virtual Private Server) is a step up from shared hosting, and it can handle spikes of traffic much better, and much more evenly than shared hosting. Here’s some more info on what a VPS is.
When I first started I made the mistake of using shared hosting, and I lost hundreds of dollars because of it. A spike in traffic crashed the server and my landing pages were down for hours.
I’ve used LiquidWeb for about 8 years now and they’ve never let me down, so I’m happy recommending them as a solid VPS provider.
When you can afford it, upgrade to a dedicated server and host your images on a CDN (such as Amazon or Rackspace) for even faster speeds.
You can make a fortune in this industry with the above three purchases alone. That is the purest 80/20 of affiliate marketing.
If you want to step up your game to a higher level, there are other purchases that can help you become more successful.
Cost: STM costs $99 per month.
Nobody is going to give away everything for free on the internet. For more top secret information you’re going to have to pay for it.
A good alternative is to join a forum with like-minded people. If you’re spending time on the Warrior Forum looking for advice, prepare to get brainwashed by newbies giving you terrible advice.
There are a lot of good PAID forums out there, but the one I recommend the most is STM. They are kinda the original gangster of affiliate marketing forums.
Follow alongs on STM are helpful for newer affiliates, and if you start your own you’ll find that mods and other knowledgeable affiliates will help you out.
I think STM is good value, if you need it. You can get enough value from blogs and articles to get started, but an online networking forum like STM might be helpful if you’re at a sticking point.
I don’t recommend any free forums. Not because there isn’t good advice, just that it’s so hard to differentiate between the good advice (1%) and the people who are only trying to sell you something (99%).
There are a few problems with forums that I see:
You can waste a lot of time “working”. What I mean is it feels like you’re “doing business work” by surfing the forums, but it can become a time sink. To solve this I recommend only going on there if you are searching for an answer to a specific question you have, or if you’re following a thread/have your own one.
There is an “I paid for this, so I wanna get as much value from it as possible” mentality. This can lead to spending too much time on there (it’s better than surfing Facebook, but not as good as doing actual affiliate marketing work). This mentality is called the Sunk Cost Fallacy and it comes from economics.
These are still public forums. Anyone can pay the entry fee and they can see/post whatever they like. There are a lot of businesses trying to promote their own stuff, and there are a lot of vultures looking for opportunities. Remember you’re entering a place where people are committed to making money on the net…
Cost: $50 – $200 per month
When I first heard “spy tools” I was like, “What, you mean like guns and a Swiss Army Knife?”. That’s kinda how you can view spy tools for affiliate marketing. They can make your work a lot easier, but they also have problems.
I’m not going to get into a massive pros/cons list here, but I’ll give you the 80/20.
- Spy tools make it super easy to see what landers are converting well for which verticals
- You can easily rip landers so you can test them yourself
- You can see which offers people are running
- They allow you to set up a campaign faster due to not having to code up landing pages
- They cost a lot, this might be better spent on traffic
- They inhibit creativity and can cause laziness
More on my thoughts about spy tools for affiliate marketing here.
I’m not going to make any recommendations on spy tools.
Cost: Variable, but often over $1,500 unless it’s in your own town.
Networking on Skype is great but it’s nothing like face-to-face contact.
I wanna say “Take every opportunity to go to affiliate marketing conferences”, but there’s a problem with that mentality.
Say you live in Seattle and you want to go to a conference in New York, how much is that gonna cost?
Here’s a super rough estimate:
- $500 for a conference ticket
- $300 for flight
- $400 for hotel
- $150 for food
You’re looking at close to $1500 (and this will increase if the conference is international). Plus you might have to take time off work which has a cost attached.
The question you have to ask is “Will I get more value spending that $1,500 on campaigns?”.
If you’re brand new to this industry, I’d recommend spending time in front of your computer and running campaigns rather than going to a conference.
The reason is that there are thousands of people at some of these conferences. If you are 100% new and you haven’t launched many campaigns, you’ll have a hard time networking with affiliates and reps. Affiliates and companies at these events live for this shit, they are hardcore.
If you’re going to go to a conference, you wanna make it worth your time and money, and you need to have a game plan.
If I’m working on mobile and I’ve got a profitable campaign but I wanna start scaling it to native ads, I want to meet some traffic source reps at native networks.
I wanna have a drink with them and pick their brain about what offers are doing well on there, what sort of verticals affiliates mainly run with them etc.
Then I’d want to talk to my affiliate managers in person and make a solid connection, and also find other affiliates to create masterminds with who work in my vertical/traffic source.
What To Do If You Don’t Have Any Money
If you can make good money quickly in affiliate marketing without any money, hit me up. TELL ME THE SECRET.
Seriously though, in my experience, you need money to make money in this industry.
I’ve written about how to hustle together some cash to get started in affiliate marketing.
There are some other things to consider.
So many guys wanna quit their job because they think they are going to become millionaires in a few months.
I have one piece of advice which I got from Richard Branson: “Cover the Downside”.
You’ve gotta think about the worst case scenario.
If you quit your job tomorrow, then spend all of your money on campaigns, what are you going to do? How are you gonna feed your family and pay your rent?
I went all in with affiliate marketing, but I didn’t know how long it would take to make money from it, so I kept my job. Even when I was making $10k per month from campaigns, I was still nervous to leave my job.
Because I wanted to be rich for life, not just for a few months or a year.
There are no guarantees in life. Too many people quit their jobs hoping that they are going to make money. This approach works for some people, but it’s too risky for me.
I wanted to play it safe and cover my downside.
There are only three must-haves to make money in affiliate marketing: traffic, tracking and a server. Everything else is optional. Don’t fall into the trap of thinking that you need a whole lot of tools.
The most successful affiliates are the ones that nail the basics, and only buy supplementary tools when they NEED them.
Remember, you’re running a BUSINESS and the point is to keep costs low and revenues high. Don’t get sold by all of the hype out there. The #1 most important thing you can do as an affiliate marketer is running campaigns, which only requires traffic, a tracker, and a server.
If you like the info I give away and wanna show me some love, add me on Snapchat for your daily dose of Ngo Bombs.
My username is charles_ngo
Featured Image by Wavebreakmedia