Profit from every click

Affiliate marketers dream of untold online riches and leaving the office behind. But is it that simple to achieve?

Ernesto Verdugo, an affiliate marketer, says his Automatic Cashflow Workshop can turn laptops into moneymaking machines.

Two months ago, James Reynolds quit his job of 10 years with the ambition of becoming rich beyond his wildest dreams. In fact, he plans to earn money even while he's sleeping. Mr Reynolds, 30, was the director of Stu Williamson Photography in Dubai. But now, he earns money "passively" as an online affiliate marketer by redirecting traffic from one site to another in the hope of generating revenue for online businesses.

In other words, by posting advertising banners on Google or Facebook, or setting up a personal domain or blog as an additional platform, any business he creates for businesses results in a small commission. Added up over time, and with millions of internet users surfing the web, more and more people are harnessing this traffic to earn a living. For many of us, this proposition might seem a little too good to be true. But Mr Reynolds is banking on its success.

"If you asked me 12 months ago would I quit a secure managerial job do something like this, I would gave you a resolute 'no'," says Mr Reynolds, who is originally from the UK. "But in this region, affiliate marketing is an untapped market waiting to be utilised." Mr Reynolds is one of 140 students who are learning the tricks of the trade from Ernesto Verdugo, an affiliate marketing guru for the past 10 years, who says he earns a whopping US$40,000 (Dh146,920) per month through his online activities.

Since October 2008, he has taught hundreds of men and women the art of making money remotely through his one-year programme (www.automaticcashflowworkshop.com). Mr Verdugo asks his students to complete weekly online assignments. In addition, they can attend four annual workshops and conferences held at various locations in the UAE. The next session is on learning more about Twitter on June 11 and 12, and there is another branded "Unlimited Power Online" on November 12 and 13, both taking place at the Dubai Community Theatre and Arts Centre at Mall of the Emirates.

Mr Verdugo divides his time between the UAE and his home in The Netherlands, and says his programme, which costs Dh7,000 for the year, can teach anyone to turn their laptop into a moneymaking machine. The reason that he hosts the workshops in the UAE, he says, is because of the untapped potential in the region as more local businesses move online. And with the advent of social media sites, such as Twitter and LinkedIn, he says there has never been a better time to exploit this method of marketing.

"Who doesn't want to quit the rat race and live on a passive income?" he says. "I'd much rather spend quality time with my four-year-old son than sitting in an office simply by getting other people to happily and readily sell on my behalf." While the course ends next month, Mr Reynolds says he is keen to start now as an affiliate marketer. He has established a domain, aptly titled Incredible internet Marketing (www.incredibleinternetmarketing.com), through which he helps companies to reactivate their websites so they can widen their revenue stream.

"Eight out of 10 websites are lying dormant, but could easily be brought back to life by enlisting affiliates," he explains. For example, an affiliate marketer can direct new traffic to a business by placing links on their personal websites. This approach not only breathes new life into the websites, but also results in a commission for the affiliate. In the past couple of months, Mr Reynolds says he has earned "less than $1,000" through promoting digital books and health products through Amazon, but he's confident that he will make higher returns in the near future.

"There's great potential in this line of work, as it's a win-win outcome for both vendor and affiliate," he says. Dave Crane, another student of Mr Verdugo, says his reasons for completing the course are different. Mr Crane brands himself as a life designer and sells a range of products, such as books and DVDs, to motivate people into changing their lives. He has two websites: www.iwantdave.com and www.thelifedesigners.com.

He wants affiliates to attract individuals to enrol in his new online academy, which will launch next month. He says the course is designed to give people the necessary tools and knowledge they need to put their plans into action. "This approach is about building relationships," he says. "It's not about shooting off e-mails at random. It's about finding out who might be interested in your services and products and contacting them."

Affiliate marketing is nothing new. In 1996, Amazon offered a 4 per cent commission on any book sale made as a result of referrals from their list of registered affiliates. This system continues today, and affiliates carrying an Amazon banner on their home page still reap the benefits.  Amazon is just the tip of this online iceberg. Indeed, www.clickbank has 100,000 registered affiliates working across 200 countries, all of which have access to a list of 12,000 vendors selling digital products. To register and have access to the database, affiliates are required to pay a one-off fee of $50.

Subsequently, affiliates can advertise for any of the vendors, and gain a commission that can range from 5 per cent to 75 per cent, depending on the company or service. According to clickbank.com, in December 2009 its registered affiliates received $1.3 million in commission from online business. Similarly, www.cj.com is another site that allows affiliates to search its directory for vendors in need of their help. To receive payment, affiliates typically open a PayPal account online (www.paypal.com), an account specifically designed for e-commerce, and earnings are then credited as part of a pay-for-performance revenue share.

According to www.dayjobnuker, a website dedicated to helping individuals earn money from home, 90 per cent of people who set out to become online affiliate marketers fail either because they lose interest, don't have the skills to redirect traffic or discover that it is not the "get-rich-quick fix" they had initially assumed it to be. The website has a collection of links to websites on how to make money on the internet for free.

"People go online by the thousands every day searching for ways to make money from home," dayjobnuker says on its website. "If they ever do break through the hype, they might find that the job they have or left behind wasn't that bad. So, before you quit your job, think twice." Katrina Gregory, 34, is an affiliate for Amazon and hosts a number of recommended titles on her website www. katrinaink.com.

Ms Gregory, a Briton based in Dubai, says the income generated is "insignificant" compared with her core business in life coaching and freelance writing. This often amounts to less than $40 a month at about 4 per cent commission per sale. "I'm always sceptical when I hear claims of earning lots of money through affiliate marketing. I do it as a sideline," she says. "On the other hand, I wouldn't rule out giving an affiliate a commission if they can direct traffic to my site that results in business."

Paul Parsons, a partner of Western Voice Sales Solutions, a Dubai-based website developer, feels there are too many people jumping on the bandwagon with not enough knowledge about the product they are reselling. While he feels it is possible to earn a living, he says prospective affiliate marketers need to be dedicated to the work and educated in the practice to earn meaningful commissions. "Unless you have a good grasp on the product or service that you're trying to resell, then this type of work is best left alone."