Here’s another excerpt in the ongoing series about online deals. Previous chapters: How FatWallet tracks down deals, Deal Locker guarantees coupon codes and Getting the best deal from Buy.com.

You may not be able to make a living by joining Buy.com’s affiliate program.

But imagine if you joined hundreds of other affiliate programs. And you had a web site that sent hundreds, no, hundreds of thousands of shoppers to Buy.com, Amazon and other online stores. If consumers buy a lot of stuff, you’ll make a decent living.

Affiliate programs, in Internet time, have been around forever dating back to the mid-1990s when I had to define the word ‘Internet’ in my stories. Back then, ordinary people could make a living off affiliate programs. And with a minimal number of consumers shopping online, online stores needed the extra promotion.

Shawn Collins — who founded the industry’s semi-annual event, the Affiliate Summit — set up his first affiliate program through Amazon in 1997. What a difference from today, he said.

“Everything was prehistoric. You couldn’t log in to see your sales. It was done by e-mail. There wasn’t all the linking options,” he remembers. “Back then, it was pretty common for people to be satisfied to make enough money to cover their Internet bill, making $20 to $40 a month. Today’s there’s a whole breed of super affiliates who are making 6-figures or more.”

Marketing Sherpa, a research consultant, reported last year that in a survey of 329 merchants and 296 affiliates, those affiliates with 3+ years of experience made on average $54,975 a year. For those with less than 2-years in the business, they made $34,612.

Marketing Sherpa’s most recent figures put the online affiliate industry at $6.5 billion in revenues in 2005.

FatWallet, Flamingo World and BensBargains.net are some of the biggest names for the industry but affiliates aren’t just deal sites. They also include blogs, e-mail lists and sites that pay for clicks, such as like Ravenwood Marketing. It’s a difficult industry to track, said Collins because many affiliates are don’t want to divulge too much about their own strategies.

However, another indication that the industry is valuable is the attention from the big companies. Last year, Google bought DoubleClick, owner of Performics, which provides affiliates technology to cut the checks.

At the last Affiliate Summit conference in February, it attracted 3,000 attendees, up from 200 five years ago. His best guess is that there are around 700,000 active affiliates with only hundreds or a few thousand who can make a living on an affiliate income.

“I don’t think the market can handle an infinite number of affiliates,” he said. “But as e-commerce grows, there’s more opportunity because there are more buyers online.”

Affiliates survive by specializing. TechBargains specialize in technology finds. CleverMoms targets parents. There are sites who donate proceeds to a charity.

“People who focus on a certain niche like electronics, there may be only a few dozen competitors. But you’ll get a loyal and active audience,” Collins said.

From a retailer’s view, affiliate programs are still an excellent source of income and such programs are worth the investment, said Jeff Wisot, Buy.com’s vice president of marketing. Buy.com’s affiliate program has attracted 100,000 affiliates since the beginning.

Why? Stores pay only when a sale is made.

“It’s a profitable program for all companies that I know of because you’re not paying for the ad space, but on the actual order they bring in. That’s why it works so well for so many companies. Other programs, like TV commercials, you’re not guaranteed that,” he said. “Many people make a very good living off it.”

Stores catering to consumers told Marketing Sherpa last year said that on average, 8.7 percent of their revenues came from their affiliate program. Some stores reported as much as 20 percent came from affiliate sales.

To make sure its affiliates continue to promote the store, Buy.com treats them well.

So well that affiliates from all over the nation voted Melissa Salas, Buy.com’s affiliate manager, as manager of the year at the Affiliate Summit awards in February.

“We need to be on our game to get ahead of our competitors because then (affiliates) promote us more. They put us on their site if we give them easy tools,” Wisot said.

“We put a lot of energy into our affiliates. We offer them exclusive deals several times a week before they are published on our site. We give them RSS feeds. We do everything we can to make our affiliates happy.”

Related posts on online deals:

• How FatWallet tracks down deals
• Deal Locker guarantees some coupon codes
• Getting the best deal from Buy.com
• The print version of the story

More links on affiliate programs:

• Shawn Collins’ Affiliate Tip guide, offers a guide to affiliate programs and how much they pay
• Affiliate Summit blog
• Deal Sites are the key to Affiliate Program success
• Paul Borque’s Uber Affiliate Marketing Guide

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