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by nextworddev 807 days ago
Curious - what is your bearish case for profitability of affiliate marketing?
2 comments

Over time affiliate programs like the Amazon one have become a lot less generous. On the other hand though from running an ecommerce site I'd be happy to work with an affiliate like this that isn't just a coupon website that basically adds no value.
That's what I've heard as well. Also, the lag to when you actually get paid is super painful.

Also curious - how do you think about affiliates as someone who runs an ecommerce site? Are there any reservations about whether services like us take search traffic or ads revenue?

people can find multiple ways to get to the same product. once your way starts charging they will find another way.
Is the implication here that you need to charge and users will leave you once you do? If you can make a product that's significantly better, then you should be able to charge. The thing I'd note for affiliate marketing as a business model is that for it to generate significant revenue, you need to have a lot of traffic while other business models can generate that much faster (subscriptions) or make you money based off of that traffic (ads) instead of how many products are purchased.
Your note on affiliate marketing is what makes your first statement potentially unachievable. How does a consumer "know" that a product is significantly better to the point of "worth paying for"? There's always another free (potentially ad supported) affiliate marketer (or 5) around the corner. (Also considering the "worst" version of this "product" is an unskippable ad").

I don't know the solution

Fair. The best solution we've seen is building the product in some way where it's somewhat defensible, either through data, features that bigger players won't build, etc. and then using a subscription based model if users are willing to pay for that and value the searches high enough or using an ads based model if you're optimizing for traffic rather than pure value on each search.
I suppose two case studies worth exploring are:

Consumer Reports (subscription magazine recurring revenue) NY times Wirecutter (a potential add on service to boost apparent value for subscribers)

We've looked a bit into CR and Wirecutter, not that deeply into CR yet though. I definitely used Wirecutter for a bit of things in the past, and they have a high level of trust that we'll need to seek to replicate.