As we head into the holiday shopping season, you might consider redoubling your commitment to blogging. We often talk about the importance of blogging here — as a way to establish and define Community — but this time of year, it takes an added importance… potential affiliate ad revenue.

Affiliate Advertising

Affiliate advertising is advertising that pays a commission for the sales your site generates. In general:

• your site displays the ad
• the user clicks the ad
• the user is transported to the advertiser’s site
• the user buys the advertiser’s product
• you get a percentage of the sale

However, if that user does not purchase an item during that visit, you do not get paid.

Therefore, it is conceivable that you could go an entire day, week — or even month — without generating ad revenue from an affiliate ad.

Amazon’s Affiliate Program

Amazon.com has an affiliate program called Amazon Associates.

What makes Associates unique is that you get a commission on any and everything the user buys after your site has delivered them to the ecommerce giant.

And, since Amazon sells practically everything, some of those items could deliver a pretty sizable return.

For example, if a user clicks one of my Associates links for an Evil Inc book, they are transported to the appropriate page on Amazon.com. If, during that visit, they decide against buying the book — but opt instead to buy a new flat-screen TV, I would earn the commission (based on a percentage of the price of the unit) on that sale.

Amazon offers different percentages for different purchases. For a complete breakdown, you can click here. Some stand-outs:

1. Electronics: 4%
2. Game downloads: 10%
3. Groceries: 4%
4. Industrial products: 8%
5. Amazon Local: 6%
6. Amazon Instant Video: 5%

Of course, the counterpoint to this argument is that 4% and 5% simply isn’t very much money. And unless your reader buys the book you linked to — and a set of tractor tires to go with them — chances are, your payout will be quite small.

Banners and links

Of course, it’s pretty easy to create a banner ad through Amazon Associates. And they have a number of pre-produced ads (at standard sizes) throughout the year. I just uploaded a bunch of ads for Halloween costumes to my rotation, for example. But remember, you can also create an affiliate-ad hyperlink. So, when I blogged about going to see “Pacific Rim” at a pop-up drive-in movie with my family, for example, I heartily endorsed the movie to my readers with a link to where they could purchase it on Amazon.com. That link was an affiliate link.

In that instance would have probably linked to the DVD of the movie on an online store anyway. Since I was registered as an Amazon Associate, I merely did so in a way that I could get rewarded for any resulting sales.

Adding it to the mix

I still don’t think you should place a lot of pageviews behind affiliate advertising. However, if you use an ad manager such as Doubleclick For Publishers (DFP), you can mitigate your losses.

For example, I have a number of Amazon Associate ads rotating through my ad chain as house ads. That means they can only display when a paying ad of a certain value or higher isn’t available. And I can control the number of times they appear in a 24-hour time span for any one user.

That means I can let my CPM (cost-per-thousand adviews) advertising take the lion’s share of the pageviews. That’s my bread-and-butter in terms of ad revenue anyway. I want to (heck, I need to) make sure those ads get plenty of views. But once the payout on those ads fall below a certain level (say 5¢ CPM), then I feel it’s pretty safe to introduce an affiliate ad and roll the dice. I’m not displacing a high-paying ad, and once my frequency cap has been surpassed, DFP can go back to paid advertising (or, in lieu of that, house ads).

In a way, lumping-in my Amazon Associates ads with my house ads makes sense. In both cases, I only get paid if the user buys something. It’s not worth displacing higher-CPM advertising — but it’s also too valuable to ignore completely.

Don’t stop at Amazon

If you’re interested in affiliate advertising, check out sites such as Commission Junction and AffiliateSeeking.com. It may be possible to find an affiliate-based ad system that would fit your readership perfectly. Clickbank, for example, seems to be one of the most often-cited leaders in this regard.