Why An Affiliate Site Is A Good Investment
February 6, 2023
Affiliate websites have grown in popularity this year as investors look for alternative assets to hedge against inflation.
With an affiliate site, you have control over how your asset performs. You can scale it as much as you like to have your income race past inflation. With other assets like stocks or currencies, you give up control to the markets and the owners of your assets.
This is why many investors are acquiring online businesses, but affiliate sites are particularly attractive to both experienced and inexperienced online business operators.
In this article, we’re going to explore why investors are acquiring affiliate sites in 2023.
Mostly-Passive Income Sources
While affiliate sites are an active investment, they’re one of the least active online business assets you can acquire.
Once they’re monetized, little is required from the owner to manage the income streams. Most affiliate sites earn income in three ways.
Affiliate Revenue
The main way an affiliate site earns revenue is by promoting the products and services of other businesses.
You’ll notice as you look around an affiliate site—i.e. a blog— that there are many text links in the articles. When a user clicks through one of these links, they’re taken to a store or business.
When they purchase a product or service offered by the affiliated business, a commission on the sale is paid to the affiliate site that links to the business. Sales commissions are typically paid out monthly or quarterly depending on the terms of the affiliate program.
When an affiliate site is established, the only thing the site owner needs to do to manage its affiliate revenue is to make sure the links are working and the offers and products being promoted in their site’s content are still live.
If you were to build your own site from scratch, it would take you months or even years to get the site ranked in Google through consistently publishing articles and carrying out search engine optimization (SEO) work. When you acquire a pre-built affiliate site, the owner has done this work for you, so all you need to do is keep the site functioning.
Another way an affiliate site can generate revenue is through display advertising.
Advertising Revenue
You may also notice flashing display ads on blogs you read; these ads are generating revenue for the site.
An affiliate site can be connected to an advertising network, such as MediaVine or Google AdSense. The advertising network provides small pieces of code that are added to the site by its owner.
Businesses pay the advertising network to display their ads on the site. The companies are charged per ad view or click, depending on their terms.
Every time a site visitor views or clicks through an ad for a business, that business pays a fee to the advertising network. The ad network then pays a percentage of this fee to the website displaying the ad as a commission.
Similar to affiliate links, once the ads are set up on the site, all the owner needs to do to manage the revenue stream is to make sure the site is functioning and check the ad offers are still available.
The final most-common way affiliate sites earn revenue is through sponsored content.
Sponsored Content Revenue
If a blog is popular in a particular niche and gets a considerable amount of traffic, businesses within that niche will offer to pay the blog owner to feature their article or video on their site.
The site owner could receive a one-time payment for the article or a recurring payment to keep the article on the site.
Once the article is posted, all the site owner needs to do is make sure the content is visible on the site and all of the sponsored links are working.
Entrepreneurs and business acquirers love affiliate sites as sources of income because they don’t have to worry about the income streams. Compare this to managing an ecommerce business where you need to plan and order inventory, communicate with suppliers and fulfillment companies, and handle customer service, you see how managing an affiliate site is less time-consuming.
There also aren’t many operational tasks for managing an established affiliate site.
Hands-Off Operations
The affiliate site business model doesn’t have much structure outside of its content, ads, and links, therefore all of the operational tasks are focused on these areas.
As well as keeping the website functioning, the site owner needs to produce and manage content.
Even if you’re not experienced in content production or SEO, you can still run a content site; you can outsource content production to writers and researchers. All you need is an SEO strategy, and in most cases when you acquire a content site, the previous owner already has one they used for the site. Be sure to ask the owner if they have documented procedures, known as standard operating procedures (SOPs), for the site’s SEO.
SEO operations are straightforward at their core, so it won’t be too difficult for you to understand how it works. The best thing about getting SOPs for these operations is you can outsource the work to virtual assistant (VA) researchers and writers to produce content for you.
Depending on the complexity of the website, you could easily maintain it yourself or hire a developer on an as-needed basis to maintain it for you, although most affiliate sites are user-friendly and don’t require the expertise of a developer.
Another maintenance task is monitoring site performance.
Analytics tools like Google Analytics and Clicky are used to track business performance metrics like the number of monthly site visitors, article rankings in Google, how long visitors stay on the site, and other more detailed metrics.
The site owner should be willing to walk you through their analytics dashboard and teach you which metrics to track to maintain business performance. They may also have SOPs for this task, making it easy for you to take over.
If you’d like a professional to watch the site’s performance and make recommendations for improvements, then you could hire a data analytics expert. However, for most sites, this isn’t necessary.
Overall, almost all operational tasks for affiliate sites can be outsourced.
Outsourcing Affiliate Site Operations
There are four ways you can outsource operations for an affiliate site:
- Hire VAs
- Implement software tools
- Partner with freelancers
- Hire agencies
VAs
VAs carry out repetitive and low-skill administrative tasks. There are many types of VAs, all specializing in specific areas.
They’re commonly hired for tasks like
- Keyword research
- Article posting
- Social media posting
- Market or product research
- Competitor research
- Administrative tasks
With SOPs provided by the previous site owner, you can easily outsource these operations to VAs.
Software Tools
To improve the efficiency of a VA carrying out the tasks listed above, you can integrate software tools into your operations.
For example, social media posting tools provide a dashboard where you can manage multiple social media accounts in one place. With this type of tool, your VA can post on multiple social media accounts efficiently, reducing the number of hours they work and the employee costs for your business.
Another example is competitor research. Tools like Sparktoro, which is a competitor analysis tool that provides information about the marketing strategies of websites, can aid in competitor research, allowing you to see how to best market your site.
Many repetitive, administrative tasks can be outsourced for cheap, saving you time and energy. However, some more involved tasks might require the help of people with expertise.
Freelancers
We’re starting to see complex tasks like content writing being outsourced to artificial intelligence (AI) writing tools. However, Google penalizes sites that overuse AI writing tools to produce content.
This is where a freelance SEO specialist or writer can help.
If you’ve never written content before, you can hire a freelance writer or SEO to use an AI writing tool for you to produce content for your site.
As long as both the freelancer and the AI are provided with clear instructions and boundaries for how much text can be produced by AI, you should avoid Google penalties and be able to produce a lot of content consistently with no extra work on your part.
If you want to generate a return on investment (ROI) on your site quicker by scaling growth operations like content production, then you can consider hiring a specialist agency.
Agencies
The most common types of agencies used by affiliate site owners are SEO and content production agencies.
SEO agencies provide SEO frameworks that help you increase your site’s rankings in Google. With more traffic, your site will make more revenue. Most SEO agencies also offer content production services.
Content production agencies offer more marketing services. They have other ways of promoting your site to get more traffic, including social media posting and paid advertising.
Agencies are expensive compared to hiring freelancers or VAs, but because of their larger resource base, they should be able to scale your site further and faster.
This leads us to the next positive quality of affiliate sites: they’re easy to scale.
Scaling Is Easy
Building an affiliate website from scratch and growing it to a point where it’s consistently earning revenue takes a lot of work. Once it’s earning and its maintenance is mostly-passive, then scaling it becomes easy.
The fastest way to earn an ROI from your site acquisition is to update the site’s old content. This will increase the rankings of the content in Google, which will drive more traffic to the site and increase affiliate sales.
The most-popular scaling strategy implemented by affiliate site buyers is content production.
This strategy begins with assessing the site’s analytics data to identify which content topics are generating the most revenue. Then, you produce more content on those topics. This strategy is effective because you already know the site performs well for those topics, so there’s a high chance any new content you create around those topics will also perform well.
You can also identify topics the site is performing well for but that isn’t generating much revenue from. Producing affiliate content for these topics is a quick way to generate more revenue.
There may also be shoulder topics the previous site owner has identified as opportunities, so be sure to ask them about topics you can produce more content on.
Another quick way to increase revenue without doing any extra marketing and driving more traffic to the site is to implement display ads. Once you’ve connected the site to an advertising network you can leave the new revenue stream to earn extra money.
The beauty of acquiring an already-established affiliate site is it will have many assets you can leverage to grow the business.
Leveraging the Site’s Assets to Scale
The most valuable asset a content site has is its audience. Business buyers will acquire affiliate sites just to use the audience to bolt onto their other businesses.
A site may already be generating revenue from its audience through its affiliate links, but there are ways you can generate extra income from that audience.
Redesigning the site and implementing conversion rate optimization (CRO) strategies to improve the site’s usability, design, and sales copy will increase the number of visitors that click through to your affiliate links, resulting in more sales.
If the previous owner has created an email list, you can use the audience data from the site’s analytics to identify the most popular content topics and products. With this intel, you can create email marketing campaigns to promote content and products to earn from the email list as well as the site traffic.
Another asset a site has is its content.
This can be used to market the site to increase the size of its audience. You can, again, head to the analytics dashboard to pick out the most popular content and promote it on social media to expand the site’s reach.
There are many creative ways you can implement these growth strategies to earn a healthy ROI from your affiliate site acquisition.
The best quality of affiliate sites is how beginner-friendly they are. All you need is a basic understanding of SEO, website maintenance, and digital marketing to have the capacity to be successful.
Acquiring an affiliate site then just becomes a question of how to choose the right site for you.
Finding the Right Affiliate Site For You
Affiliate site-based businesses are easy to take over. There are few assets to be handed over to the new owner and they’re easy to transfer.
When you acquire an affiliate site with Empire Flippers, our migrations department handles the whole migration process for you, including transferring all of the business assets over to you and holding your funds until the site is transferred.
After you have the site, you have a two-week migration period where if the site grossly underperforms you’re able to renegotiate with the seller or pull out of the deal completely and get your money back.
We set up this system to protect buyers and sellers from manipulation and bad deals being made.
Choosing the best site to acquire depends on a number of factors, including your online business experience, experience with affiliate sites and digital marketing, professional expertise, resources, and budget.
It can be difficult to consider all of these factors when looking at sites, especially since you also need to conduct due diligence on the sites to make sure they’re healthy and legitimate businesses.
If you’d be open to receiving help to find the ideal site for you, our expert business acquisition advisors offer free, no-obligation advice. Schedule a discovery call to get clear on what type of sites you could acquire.
