This is part 2 of my 2-part post on 10 Ways Affiliate Marketing is Like Playing Poker. You can read part 1 here.
You don’t have to like or know how to play poker to find this post interesting, although it will sure help to be into at least one of them.
When drafting this post, it didn’t take long for me to construct a list of 10, and in fact I could probably go on to write 15 or even 20. It really is interesting just how many parallels there are between poker and affiliate marketing.
In fact, while I played poker before I started affiliate marketing, my first real affiliate leads were actually made back years ago when I referred players to the various poker rooms. The payouts in the gambling niche are amongst the highest payouts out there – we’re talking $150-$300 CPA’s folks.
Anyhow, here’s the second half of the list:
#6 – You need to be able to take risk
In poker, you are considered a "rock" if you play extremely tight and passively. That is, you only play premium hands, and then when you do play, you bet very timidly and cheaply, afraid to scare anyone else out of the pot.
While rocks will win the majority of the hands they play (more than any other playing style), they will lose in the long-term not only because they are predictable (you can spot a rock a mile away), but because they don’t build the pot and maximize the hands they finally do play.
You have to be willing to accept risk and the consequences it provides in poker. You can’t be a winning poker player and not purposely put yourself in risky situations. Poker is all about calculated risk.
Affiliate marketing is not much different. While not quite as extreme as in poker (you can still make money in affiliate marketing while putting yourself in relatively low risk, although it will be hard to make the real big bucks doing so), it is still an important factor.
Just as in poker you never know what your opponents have until they reveal their hand at the showdown, you will never know the outcome of a campaign in affiliate marketing until you actually run it and pay for traffic.
You have to be willing to lose money.
So important. In fact, I almost titled #6 this, but decided to go with "You need to be able to take risk" because it’s really the underlying theme here.
For example, you need to be able to spend 3-4 days working hard creating 5 landing sites for 5 affiliate offers, and then run 5 campaigns for them, only to find out that all 5 offers get taken down before you can even try them, thus wasting your time. In this case, you risked your time.
But you certainly need to be able to risk your money and be okay with it. In poker, you need to be able to re-raise all-in, even if you have nothing and are stone cold-bluffing, if you know it’s the right move (if it matches your past betting patterns for this hand and past hands, the board puts your hole cards in a realistic range you might play, and you know your opponent will fold, and "pot odds" call for it) and take responsibility if your opponent decides to call and you lose a massive pot. If it was the right decision, you need to do it.
Here’s a clip of a hand from High Stakes Poker (the best poker TV show hands-down) that actually illustrates the example I made above (that’s real money, BTW – not "tournament dollars" – it’s a ring/cash table):
(Note: You may need to visit the post directly at TylerCruz.com if you’re reading this via e-mail or RSS in order to see it.)
The vast majority of stuff you will try in affiliate marketing will fail. Finding a winning campaign is a rarity and almost like finding a needle in a haystack, but once you find one, you’ll be ecstatic. You have to be willing to throw money on losing campaigns until you find winning ones.
The ratio of wining campaigns to losing campaigns is high, which is why the dropout rate of new affiliate marketers is so high.
You want to keep things in line and not go overboard in your spending, of course, but you have to be willing and able to take risk if you want to really get anywhere in affiliate marketing.
#7 – It’s not all about the numbers
To be a winning poker player, you HAVE to know your math for things such as probabilities and pot odds. It’s an absolute necessity.
Sure, the old school legends such as Doyle Brunson like to lead you to believe that they play purely on years of experience, the truth is that it’s impossible for them to still be as good as they are without still knowing at least the general basic math of the game.
At the same time, poker is not all about the numbers. If it was, then computers would be able to beat humans at poker. But they can’t. While computers may dominate chess and Jeopardy (I have a 3-4 post series of Watson on Jeopardy), poker is one of the few games that computers haven’t embarrassed us at (…yet).
This is because there are so many more aspects to poker than just pot odds and probabilities. There is table image, psychological play, tells, and other elements of play that make the game so challenging. There’s a reason that all the winning poker players aren’t all accountants and math professors.
In affiliate marketing, there is so much to it other than numbers as well. And I’m not just talking about money here either, but numbers in general – payouts, ROI, CTR, etc.
For example, establishing a good relationship with your affiliate manager is unbelievably important. I talk to my affiliate managers on a daily basis, and probably an average of 30-minutes a day, every day. If you know how to bug them properly, they can be an invaluable tool at your fingertips.
For some more examples of how affiliate marketing is not all about the numbers, there’s:
- Networking (conferences, for example)
- Reading up on the latest techniques, tips, and strategies
- Being creative (coming up with interesting campaigns, unique image angles, etc.)
- Negotiation (higher payouts, faster payouts, permission for certain traffic sources, etc.)
I could go on, but you get the point – there’s so much more to affiliate marketing than just the numbers.
#8 – There will be a lot of ups and downs
Since luck is such a big element of poker, every player inevitably goes through swings. It can be really hard to go through swings because it’s such an emotional drain. One month you’re doing great, the next month your down $3,000.
In fact, sometimes you’ll have bad swings for as long as 2 months straight. It’s just the nature of the game and lifestyle of poker. You can’t win all the time – not with luck being such a big factor.
The same goes with affiliate marketing. Now, on this particular section I am only using my own experience, but I’d be very surprised if I was the only affiliate marketer with a lot of ups and downs.
But ups and downs I’ve had – for sure. In fact, the variance of the success I see in affiliate marketing is higher than I care to admit. And it usually happens in periods of around a month, more or less. I’ll be running profitable for about a month, and then something will happen (offers go down, traffic prices increase, etc.) and I’ll basically be making nothing for a month.
The fact that winning campaigns don’t last forever is one of the major downsides to affiliate marketing, which is why you need to really suck every ounce of value out of them when you do find them.
#9 – No matter how good you are, you need to put in a lot of hours
Anybody who has ever really attempted to make money for a living playing poker (as I did when I was in my early 20′s) will know that the amount of "grinding" is poker is insane. Your life basically turns into one long grind, as all you do is play poker all day and night.
The good disciplined semi-pro players are able to make sure they don’t overplay, but the majority of wannabe poker pro’s (like I was) will play a good 10+ hours a day, 7 days a week.
The same goes for offline play. Playing poker live takes a lot longer because you are playing way less hands per hour due to the fact that a dealer needs to actual deal and whatnot, as opposed to the automatic nature of the Internet.
And even real poker professionals put in a crazy amount of hours – all they do is play poker (unless they are sponsored or have some books out for side income) because they need to constantly play in order to make money. There’s no robot they can replace themselves with.
The thing is, with luck and variance being such big issues in poker, you have to play a lot in order to make up for all the times you get unlucky (or play poorly). When you are on a losing streak for a few weeks (which happens to the very best of the best), you’re not just not making any money – you’re actively losing a crapload. This is partly why poker requires so much investment of time.
Affiliate marketing is very similar because as just written in #8 above: there will be a lot of ups and downs.
While it may seem like you can just sit back and relax when you find a winning campaign, the fact is that when a campaign dies, you are back to square one, so affiliate marketers are constantly trying to find new winning campaigns.
There are many other reasons why affiliate marketing takes a lot of time as man hours. Here’s a small list of reasons why:
- The industry is constantly changing (very quickly too), and thus learning the latest changes is a must (new avenues such as mobile, FTC changes, new tools and services, etc.)
- Constant need of optimizing and managing campaigns
- Creating new angles and ad copy/creative is a never-ending task
However, unlike poker, with affiliate marketing you actually can walk away from work, take a 3-week vacation leaving your campaigns on auto-pilot, and still be banking in the big bucks every day. That’s one of the awesome things about the industry.
But to treat it as a business and really grow as an affiliate, you need to really put in a lot of hours in order to build up a portfolio of multiple winning campaigns.
Remember, winning campaigns never last forever – so you need to get working on that back-up winning campaign.
#10 – Money is power
When you’re playing a game of poker and a new player joins the game, you can always immediately tell if he’s a fish (and/or is in way over his head) if he doesn’t buy in at the table’s max limit.
For example, on a $0.25/$0.50 NL table, the maximum buy-in is typically 100 BB, so $50. So when a player joins the table with $30, 99% of the time he will be a fish.
This is because chips are power in poker, whether it be cash games or tournament games (in which case chips are even more powerful).
The same thing goes for if a player doesn’t constantly "top up" his chips. For example, a player could buy in at $50, then after 30-minutes of play get down to $39.75. A good player will always keep his stack topped-up to the table’s max (in this case, $50), because again – chips are power.
I won’t bother going into all the reasons on why chips are power, but basically it’s important for two main reasons: you can push around and intimidate opponents and you want to maximize your profits when you have the nuts (best possible hand) – or really good hand anyway.
Money is just as important in affiliate marketing.
I put this in bold and as its own paragraph because this is something that I believe a lot of people don’t know about. In fact, I never considered it when I first started affiliate marketing, but now that I am a little bit more experienced, I can definitely tell you that it is an extremely important factor.
The more money you have and the more money you are willing to put into affiliate marketing, the faster you will learn and the faster you will find winning campaigns.
If you remember, #4 on the list of this 2-part post series was you can get into the game for $50.
While you can get started really cheaply, you will find a winning campaign a hell of a lot faster if you have $500 to work with rather than just $50.
There are so many reasons on why having access to money is so important in affiliate marketing that I’ll break the rest of this into little mini-entries:
#10-1 – Improved cashflow
When you make a lead on an affiliate network, you typically won’t get paid for at least 30 days unless you do a certain amount of volume to get on faster payouts. Networks will typically want to see you consistently generate at least $1,000/week in order to get paid weekly, for example.
Let’s say you find a winning campaign and are generating $3,500/month gross (just shy of being eligible for weeklies) with a net profit of $1,500/month. You’re doing awesome and are making $50 net/day, but have to pause your traffic source because you run out of money to keep it going.
You’re then stuck waiting for your $3,500 wire to come in from the affiliate network, which will take 30 days in order to get paid for all of it. You’re essentially losing out on $50/net a day – actually a lot more, because this is all time you could be spending on scaling your campaign and finding other winning campaigns.
#10-2 – Faster data = faster results
Affiliate marketing requires a lot of data in order to know if a particular campaign will work or not.
While you could pay a real low CPC or CPM rate and get cheaper traffic, you will also get traffic at a much slower rate, which will in turn take you forever to find out anything.
For example, while a $0.30 CPC bid on Facebook might yield you 5 clicks a day, a $0.50 CPC bid will give you 500 clicks per day. It would take you 100 days to get the same amount of data that I amassed in a single day.
Which leads me to my next point…
#10-3 – Bully the competition
2-3 months ago, I was in an absolute fierce bidding war with another affiliate.
It got to ridiculous levels, where I was purposely spending over double the traffic rates that I originally was, just in order to try to bully him out and mark my territory. The rates were so high that I was going well into the red to show that I meant business.
After about a month or so, my tactic eventually worked, and he went away, and I got my original rates again.
Going back to #10-2 example above, let’s say that bot you and I are running the exact same campaign – same offer, traffic source, targeting, ads, etc. and you’re the one at $0.30 CPC and I’m the one at $0.50 CPC.
We both start at the same time, but since I am getting traffic at a faster pace, I am able to find out that the campaign is a winner almost immediately, while you’re still clueless. I then raise my bids to $0.60 CPC as the EPC turns out to be $0.75 on the offer, and then suddenly you find that you’re getting no traffic, and it’s too expensive for you to get any traffic.
Can you see how money is power here? The only difference in this scenario was that I spent more than you.
#10-4 – More money = more access to new traffic sources
While the big traffic sources such as Google AdWords and Facebook allow you to start getting traffic for basically free (post-billing cycle), there are a lot of sources out there in which you need to deposit funds before hand.
And not only this, but the bigger media buy you do, the more you will need to prepay and commit to. Some places will "only" want a $500 or $1,000 deposit from you, while others will require a $5,000 or $20,000 commitment.
This right off the bat keeps the amount of people who run this sort of traffic to a pretty small number due to its expense, which in turn means that competition is less (in a way) as well.
You can see how not having enough money to try these traffic sources out excludes you from possible goldmines, and why money is once again power.
That brings me to the end of this 2-part post series. I hope you enjoyed it, as it took a while to write!