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Decision Making Guide: How to Make Smart Decisions and Avoid Worst Decision that Will Affect Our Life

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What is Decision Making?

Let’s define decision making. A decision can be defined as a course of action purposely chosen from a set of alternatives to achieve organizational or managerial objectives or goals. Decision making process is continuous and indispensable component of managing any organization or business activities. Decision making is just what it sounds like: the action or process of making decisions. Sometimes we make logical decisions, but there are many times when we make emotional, irrational, and confusing choices. This page covers why we make poor decisions and discusses useful frameworks to expand your decision-making toolbox.

Why We Make Poor Decisions

Tim Ferriss shares a line by one of his mentors in which I feel sets the tone for why this topic is an incredibly important one. His mentor said, “Easy decisions make for a hard life. Hard decisions make for an easy life.” It had me reflecting on some of the decisions and choices I’ve had to make in recent times.

Decision making is one of the most laborious processes I know. For somethings, I can make decisions with relative ease, and for others, it can be a daunting task. I’ve made some excellent choices in life, some inferior ones, and at times when there are tough decisions to make I avoid them like the plague. Why?

I’m always inspired to research motivation and reasons behind why as it relates to how the journey of my life rolls out. How is it possible that by making hard decisions in life we can lead to an easier one? Why do we make poor decisions? In awareness and understanding perhaps I will be able to make wiser decisions moving forward.

In Dan Gilbert’s Ted Talk, titled “Why We Make Poor Decisions,” he shares an insightful formula as to how we calculate the expected value of something. This formula may help us better understand the reasons, errors and the why behind some of the decisions we make.

It was Daniel Bernoulli who apparently came up with this formula. He was an 18th-century Swiss mathematician known for his work on probability and statistics. The recipe looks like this, Expected value = Odds of gain + Value of gain. This relates to the actions or decisions we will likely make.

Here is how it works. If we can calculate the odds and value of any gain, we will be able to know might better how we will behave. For example, if in taking action the odds of something occurring is high and the value we attach to its occurrence is also high, we are likely to make a decision in favor of the action. If these elements are low, we will likely to make poor choices or none at all. At least this is my understanding of the formula.

According to Gilbert, there are a few reasons why people make bad decisions, and usually, it results from an error of judgement. What influences our ability to reason is our upbringing, conditioning, experiences and everything else we’ve been exposed to in life. That is the hard wiring of our brain, and it will affect how we calculate odds of gain and value. Emotions have an important role to play.

Gilbert also said that when we compare we may even make errors in judgment. Comparing is contextual to a particular experience. In one instance the odds may look favorable based on other positive elements occurring at the same time however in different contextual circumstances it may not be so.

There is the social comparison that effects our decisions and comparison to our experience. For example, many of our purchasing decisions are driven by social comparison. How will this make me look? Also, if we did or had something in the past that we remember as being good we might decide to purchase or do it again but this time be disappointed because the conditions were not the same.

These factors will contribute to either an overestimation or underestimation of odds and misrepresented perception of value.

Having experienced something more frequently in life, we will be in a better position to calculate the odds of it happening. For those things we are unfamiliar with it is more challenging to do this. For example, I can safely predict the odds of how good I will feel after going for a run in the morning, something I do a few times a week. On the other hand, waking up to go for a surf, something I’ve never done, will be more difficult to determine the expected value.

However, I can form assumptions based on my interactions with other surfers and their shared experiences and my knowledge that exercise and swimming in the ocean positively influence how I feel. In practice, I will be better able to calculate the odds. It reinforces to me why it is important to experiment and try things in life before ruling out possibilities that may lead to regret.

If we can easily see that the gain of something happening is more likely to occur because it has been something we’ve been more heavily exposed to or experienced, that will increase the overall expected value and the motivation to act. However, the odds of gain are based less on calculated fact and more so driven by emotions. In my experience, even with hard evidence, emotion usually overrules.

According to Lisa Feldman-Barrett, the theory that emotions are hard-wired is flawed. She proposes the constructionist theory which states that emotions are learned and built over a lifetime of experiences. Neuroscience research has found that emotions result from numerous brain networks working in tandem and influenced by “effect” – the mind and body relationships to stimuli.

As mammals, in life, we are influenced by the need to survive. To do this, we seek to fulfil our fundamental needs that are purposeful to our survival. Reward and punishment drive our actions. The brain functions as an efficiency tool. To help us remember what is good or bad and hence improve our ability to survive. The issue is that it is not necessarily always right.

The brain, now filled with pre-conditioned tendencies, will interact with the external environment and how the body feels to produce emotions, either positive or negative. Emotion will powerfully motivate our decisions, and how well we determine the odds of gain and value of gain despite evidence or fact, that may suggest otherwise.

How many times do we do, say, eat, or think things that even against our best judgment we still proceed? When angry I may lash out violently, and yet I know it’s not the best solution. When tired or sad I eat unhealthy foods or drink despite my knowledge that such things are not suitable for me long-term. I buy something that I want in anticipation of how happy it will make me feel and yet a couple of days or hours later I’ve forgotten all about it. I realize that most of what I think I want is driven by perceived needs and that without it I wouldn’t be any worse off.

In summary, and this may sound obvious to many of you, emotions affect the quality of decisions we make in life. Emotions affect the quality of life. I believe that with increased awareness and growth in our knowledge we will be able to understand better how our emotions work and therefore how they direct our decisions. From there, may we all make better decisions and live a life with greater freedom, fulfillment and happiness.

I like to think of myself as a rational person and reasonable person, but I’m not one and I am not perfect. The good news is it’s not just me — or you. We are all irrational. For a long time, researchers and economists believed that humans made logical, well-considered decisions. In recent decades, however, researchers have uncovered a wide range of mental errors that derail our thinking. The articles below outline where we often go wrong and what to do about it.

  • 5 Common Mental Errors That Sway You From Making Good Decisions: Let’s talk about the mental errors that show up most frequently in our lives and break them down in easy-to-understand language. This article outlines how survivorship bias, loss aversion, the availability heuristic, anchoring, and confirmation bias sway you from making good decisions.
  • How to Spot a Common Mental Error That Leads to Misguided Thinking: Hundreds of psychology studies have proven that we tend to overestimate the importance of events we can easily recall and underestimate the importance of events we have trouble recalling. Psychologists refer to this little brain mistake as an “illusory correlation.” In this article, we talk about a simple strategy you can use to spot your hidden assumptions and prevent yourself from making an illusory correlation.
  • Two Harvard Professors Reveal One Reason Our Brains Love to Procrastinate: We have a tendency to care too much about our present selves and not enough about our future selves. If you want to beat procrastination and make better long-term choices, then you have to find a way to make your present self act in the best interest of your future self. This article breaks down three simple ways to do just that.

How to Use Mental Models for Smart Decision Making

The smartest way to improve your decision making skills is to learn mental models. A mental model is a framework or theory that helps to explain why the world works the way it does. Each mental model is a concept that helps us make sense of the world and offers a way of looking at the problems of life.

You can learn more about mental models, read how Nobel Prize-winning physicist Richard Feynman uses mental models, or browse a few of the most important mental models below.

Top Mental Models to Improve Your Decision Making

  • Margin of Safety: Always Leave Room for the Unexpected
  • How to Solve Difficult Problems by Using the Inversion Technique
  • Elon Musk and Bill Thurston on the Power of Thinking for Yourself

Best Decision Making Books

  • Thinking, Fast and Slow by Daniel Kahneman
  • Poor Charlie’s Almanack by Charles T. Munger
  • Seeking Wisdom by Peter Bevelin
  • Decisive by Chip Heath and Dan Heath

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Personal Continuous Improvement To Our Life: How It Works and How to Manage It?

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What is Continuous Improvement?

Let’s define continuous improvement. Continuous improvement is a dedication to making small changes and improvements every day, with the expectation that those small improvements will add up to something significant.

The typical approach to self-improvement is to set a large goal, then try to take big leaps in order to accomplish the goal in as little time as possible. While this may sound good in theory, it often ends in burnout, frustration, and failure. Instead, we should focus on continuous improvement by slowly and slightly adjusting our normal everyday habits and behaviors.

It is so easy to dismiss the value of making slightly better decisions on a daily basis. Sticking with the fundamentals is not impressive. Falling in love with boredom is not sexy. Getting one percent better isn’t going to make headlines.

There is one thing about it though: it works.

How Does Continuous Improvement Work?

So often we convince ourselves that change is only meaningful if there is some large, visible outcome associated with it. Whether it is losing weight, building a business, traveling the world or any other goal, we often put pressure on ourselves to make some earth-shattering improvement that everyone will talk about.

Meanwhile, improving by just 1 percent isn’t notable (and sometimes it isn’t even noticeable). But it can be just as meaningful, especially in the long run.

The power of tiny gains

In the beginning, there is basically no difference between making a choice that is 1 percent better or 1 percent worse. (In other words, it won’t impact you very much today.) But as time goes on, these small improvements or declines compound and you suddenly find a very big gap between people who make slightly better decisions on a daily basis and those who don’t.

Here’s the punchline:

If you get one percent better each day for one year, you’ll end up thirty-seven times better by the time you’re done.

This is why small choices don’t make much of a difference at the time, but add up over the long-term.

For much more on this concept (and an example of a coach who used it achieve huge Olympic success), read this: This Coach Improved Every Tiny Thing by 1 Percent and Here’s What Happened.

Continuous Improvement Tools

Now, let’s talk about a few quick steps you can take right now to start focusing on continuous improvement.

Step 1: Do more of what already works

We often waste the resources and ideas at our fingertips because they don’t seem new and exciting.

There are many examples of behaviors, big and small, that have the opportunity to drive progress in our lives if we just did them with more consistency. Flossing every day. Never missing workouts. Performing fundamental business tasks each day, not just when you have time. Apologizing more often. Writing Thank You notes each week.

Progress often hides behind boring solutions and underused insights. You don’t need more information. You don’t need a better strategy. You just need to do more of what already works.

Step 2: Avoid tiny losses

In many cases, improvement is not about doing more things right, but about doing fewer things wrong.

This is a concept called improvement by subtraction, which is focused on doing less of what doesn’t work: eliminating mistakes, reducing complexity, and stripping away the inessential.

Here are some examples:

  • Education: Avoid stupid mistakes, make fewer mental errors.
  • Investing: Never lose money, limit your risk.
  • Web Design: Remove the on-page elements that distract visitors.
  • Exercise: Miss fewer workouts.
  • Nutrition: Eat fewer unhealthy foods.

In the real world, it is often easier to improve your performance by cutting the downside rather than capturing the upside. Subtraction is more practical than addition.

One of the best ways to make big gains is to avoid tiny losses.

Step 3: Measure backward

We often measure our progress by looking forward. We set goals. We plan milestones for our progress. Basically, we try to predict the future to some degree.

There is an opposite and, I think, more useful approach: measure backward, not forward.

Measuring backward means you make decisions based on what has already happened, not on what you want to happen.

Here are a few examples:

  • Weight Loss: Measure your calorie intake. Did you eat 3,500 calories per day last week? Focus on averaging 3,400 per day this week.
  • Strength Training: Oh, you squatted 250 pounds for 5 sets of 5 reps last week? Give 255 pounds a try this week.
  • Relationships: How many new people did you meet last week? Zero? Focus on introducing yourself to one new person this week.
  • Entrepreneurship: You only landed two clients last week while your average is five? It sounds like you should be focused on making more sales calls this week.

Measure backward and then get a little bit better. What did you do last week? How can you improve by just a little bit this week?

Step 4: Always Think Positive

Positive thinking is a mental and emotional attitude that focuses on the bright side of life and expects positive results. A person with positive thinking mentality anticipates happiness, health and success, and believes that he or she can overcome any obstacle and difficulty.

Always thinking positive even it hard times and challenging moments in life, business, career, and with the family have a great impact to once life and future. Think positive will bring you to success and tremendous change in life. Having a positive mindset and positive upbringing will surely make influence others specially those around you.

Step 5: Be Strong and Never Give Up

Never Give Up means believing in yourself. It means willingness to accept “failure” so you can learn the critical skill of adaptation. It means not compromising on your most important values, and walking the walk, rather than just talking the talk. It means living the life you want and are passionate about.

Being Strong means able to perform a specified action well and powerfully. Having a strong will personality makes you surpass hardships in life and keep the head high while the foot on the ground. Being strong does not give people the right to suppress other but instead to be the light and inspiration for other people. Strong will person have a good leadership treats.

Here are 8 effective ways to become more mentally strong:

  1. Focus on the moment.
  2. Embrace adversity.
  3. Exercise your mind.
  4. Challenge yourself.
  5. Respond positively.
  6. Be mindful.
  7. Don’t be defeated by fear.
  8. Be aware of self-talk.

Everything really relies to the person involved and it need great courage to keep on improving ourselves and to never say “I give up”.

Israel-Gaza: Heavy firefight traded across the border between Israel military and Hamas

A bus set ablaze after it was hit by a rocket fired from the Gaza Strip, 12 November 2018

Israel says its fighter jets have hit 100 Palestinian militant targets overnight in the Gaza Strip after militants fired 370 rockets at Israel.

Six Palestinians, four of them militants, died in the strikes on Gaza, while a man was killed in a rocket attack in the Israeli town of Ashkelon.

Both Israel and Hamas, the militant group that rules Gaza, have threatened to escalate their actions.

Violence erupted when a covert Israeli mission was exposed in Gaza on Sunday.

Seven Palestinian militants, including a Hamas military commander, and an Israeli lieutenant colonel who was in the undercover unit were killed in clashes.

The incident came after apparent progress in an effort by Egypt and the UN to secure a truce on the Gaza border, where more than 200 Palestinians have been killed during protests since March.

How serious is the upsurge?

After a brief lull following Sunday night’s violence, a barrage of rockets and mortars was launched towards Israel late on Monday, which Israeli medics said killed one person and injured 28.

A bus, which had reportedly been carrying troops, was hit by an anti-tank missile in the Shaar Hanegev region, seriously wounding a male soldier.

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Overnight, one man was killed when a block of flats in Ashkelon was hit by a rocket. Unconfirmed Israeli media reports identified him as a Palestinian from the West Bank.

Eight other people were injured in the attack, including two women who the Israeli ambulance service said were in a serious condition.

In response, the Israeli military carried out what it called a wide-scale attack against military targets belonging to the Hamas and Islamic Jihad groups.

It said they included Hamas’ military intelligence headquarters in northern Gaza and “a unique vessel” in a harbour in the south of the territory.

The building housing Hamas’s Al-Aqsa TV was also bombed after being evacuated, disrupting broadcasts. Israel said the outlet “contributes to Hamas’s military actions”.

The building housing the Hamas-run television station Al-Aqsa in the Gaza Strip is hit during an Israeli air strike, 2 November 2018Image copyright by GETTY IMAGES
Image captionIsraeli air strikes targeted the Hamas-run television station Al-Aqsa

The Hamas-run Gaza health ministry said six people were killed and 25 others injured in the strikes. Four of the dead were militants and two are said to have been farmers.

This is one of the most serious rounds of fighting since Israel and Hamas fought a war in 2014.

The Israeli military has warned it is prepared to “dial up its response” to the rocket fire, while Hamas’s military wing said it was ready to “expand the circle of fire” against Israel.

UN Middle East envoy Nickolay Mladenov called on all sides to show restraint and said efforts were being made with Egypt to pull Gaza “back from the brink”.

“The escalation in the past 24hrs is EXTREMELY dangerous,” he tweeted on Monday night.

How did the violence start?

Palestinians said they discovered an undercover Israeli unit in a civilian car about 3km (2 miles) inside the Gaza Strip late on Sunday.

A firefight ensued in which the Hamas commander was killed. Israel launched air strikes and opened fire with tanks on the area, witnesses said. Six other militants were killed as well as one of the Israeli special forces soldiers.

The incident is reported to have happened east of Khan Younis, in the south of the territory.

  • Life in the Gaza Strip
  • Gaza protest image likened to famous painting

Why did Israel kill the commander?

Due to the secrecy of the operation, Israel has not revealed specific details about the mission.

The IDF said, however, that the operation was “not intended to kill or abduct terrorists, but to strengthen Israeli security”.

Palestinians look at wreckage of car destroyed in Israeli air strike in Khan Younis (12/11/18)Image copyright by REUTERS
Image captionIsrael carried out air strikes when Sunday night’s firefight erupted

The BBC’s Tom Bateman in Jerusalem says that according to a former Israeli general, the incident was likely to have been an intelligence-gathering operation that went wrong.

The exposure of such an operation by Israeli special forces inside Gaza would be extremely rare, he says.

Fawzi Barhoum, a spokesman for Hamas, denounced Sunday’s incident as a “cowardly Israeli attack”.

Why are Israel and Hamas enemies?

Hamas won Palestinian elections in 2006 and reinforced its power in the Gaza Strip after ousting West Bank-based Palestinian President Mahmoud Abbas’s rival Fatah faction in clashes the following year.

While Mr Abbas’s umbrella Palestine Liberation Organisation (PLO) has signed peace accords with Israel, Hamas does not recognise Israel’s right to exist and advocates the use of violence against it.

A school under closure in Sderot (12/11/18)Image copyrightAFP
Image captionSchools have been ordered to close in Israeli border communities as a precaution

Israel, along with Egypt, has maintained a blockade of Gaza since about 2006 in order, they say, to stop attacks by militants.

Israel and Hamas have gone to war three times, and rocket-fire from Gaza and Israeli air strikes against militant targets are a regular occurrence.

map of Gaza showing buffer zone (on land) and six-mile fishing exclusion zone
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Best Website Types That Earn Most Money at Google AdSense

Earn Money With Google AS

Want to know which kind of website is going to earn the most money with Google AdSense? Knowing which type of website is most likely to generate ad clicks will help you monetize your site and maximize your ad revenue.

In this article, we’ll show you what kind of website you should create if you’re looking to earn with Google AdSense.

What is Google AdSense?

Google AdSense is a free advertising program run by Google that allows website owners to display text, image, video, or interactive media ads on their website in the hopes that site visitors will click on them.

Google is in charge of displaying the ads on your site. And, the ads are often relevant to the content you’re publishing. This helps encourage site visitors to click on them.

After every click your site’s ads get, you get paid about 68% of what the advertisers paid to have their ad shown on your site.

The main goal when it comes to earning money with Google AdSense is to generate as many clicks as possible. If you want to earn the most money with Google AdSense, be sure to check out our helpful guide on increasing your AdSense earnings.

Any website owner can use Google AdSense. And since monetizing your website using AdSense is one of the best ways to make money online, all website owners should consider this free service.

But there are some types of websites that consistently do better than others.

Without further ado, let’s take a look at which types of websites earn the most money with Google AdSense.

1. Blogs

Blogs are known for having consistent and unique content published on them all the time. In fact, some blogs post new content daily, or even hourly.

This is attractive to advertisers paying to have their ads displayed on a website through the Google AdSense program. The reason is, popular blogs that are optimized for SEO rankings generate a lot of daily traffic that will see the ads being shown and actually click on them. This means more money in your pocket.

You might consider placing AdSense ads in the top generating spots on your blog to generate the most revenue possible:

  • Within blog content
  • Under the navigation menu but above the content
  • To the left of the blog title
  • Below blog content in the form of a native ad
  • All whitespace areas on your website

From there, you can use MonsterInsights to track Google AdSense clicks using MonsterInsights ads tracking:

  • Find out how many clicks your blog’s ads are getting
  • Find out where on your blog the most clicks are happening
  • Remove the low performing ads so others can get more clicks

For step-by-step directions, check out our tutorial on how to track Google AdSense in Google Analytics.

Using Google AdSense on your blog is the easiest way to monetize your site.

Take it from Amit Agarwal.

Google AdSense Blog Example

Earning $10,000/month with AdSense placed all over his site Labnol.org, including within blog content and at the end of blog content in the form of native ads, Agarwal is just one example of how starting a blog can earn you the most money when paired with Google AdSense.

2. Forum Sites

For some, writing blog content and attracting loyal readers is not something they want to do. However, many find that forum sites are a great way to give others a platform to speak their mind, while also generating AdSense revenue.

Instead of writing extensive blog posts, all you have to do is list forum discussion points and let users interact.

From there, drive traffic to your site, establish yourself as an authority, and create a brand, just by getting people together to talk about a variety of topics.

For a great forum example, take a look at CatForum.com. This simple forum site dedicated to cat lovers uses Google AdSense below the navigation menu and above the content.

Google AdSense Forum Site Example

There are also some ads seen at the footer of the forum section. This further monetizes this highly-trafficked forum site.

3. Free Online Tool Sites

Have you ever thought about the type of traffic a website that offers a free online tool might see? If not, you better believe if the tool you offer is valuable, lots of people will visit your site daily.

And, those site visitors are going to click on relevant ads at some point, which makes you easy money.

For example, GIFmaker.me is a free online tool that lets you create animated gifs, slideshows, and video animations, complete with music.

And, since this tool is free for everyone to use, they use Google AdSense to make some money.

Google AdSense Online Tool Example

Notice how they use the header section of their site to display ads. Plus, they use the sidebar whitespace to display ads for site visitors to click on. These ads are easy for site visitors to click on and have the potential to generate lots of money.

And there you have it! The 3 types of websites that earn the most money with Google AdSense.

If you’re thinking about using Google AdSense to monetize your website, be sure to check out how to view your AdSense reports in Google Analytics so you can optimize your ads and boost revenue once you get started.

7 Surprising Ways To Successful Affiliate Marketing for eCommerce Business

10 Surprising Ways Affiliate Marketing Will Transform your eCommerce Business

You’re always looking for a good recommendation, right?

Chinese food, car mechanic, or the latest tech gadget – we want confirmation from someone we trust that it’s a good buy.

Essentially, affiliate marketing is the eCommerce version of product promotion through an online influencer.

Affiliate marketing can be the strategic move you need to increase sales and connect with clients you otherwise would never reach.

  • By 2020, U.S. affiliate marketing spend is expected to rise to $6.8 billion.
  • 81% of brands use affiliate marketing programs.
  • 16% of all online orders are generated through affiliate marketing,

What is affiliate marketing?

Affiliate marketing is one of the only marketing channels that offers a 100 percent return on investment every time. It’s one of the only tactics that allow you to pay for marketing spend after the sale.

The affiliate marketing process involves the merchant – that’s you – and the affiliate. The affiliate, or publisher, is the company or individual that promotes your products and brand on their website. Your affiliate receives a commission when someone clicks through to your website and makes a purchase.

The best affiliates will have:

  • A trusted website that generates traffic.
  • Updated content.
  • Influence on their audience.
  • Valuable content (blog, product reviews, how-to guides).

Since the affiliate is counting on commissions, you’ll need a game plan for converting your site visitors to product buyers. It’s all about providing affiliates with the highest earnings per click (EPC). Even if you work with the best affiliates, they’ll promote your products less and switch their concentration to other eCommerce sites that have higher conversion rates and EPCs, so you need to be strategic in your approach.

With 38% of marketers calling affiliate marketing one of their top customer acquisition methods, it’s worth adding to your eCommerce strategy.

Here are 10 ways affiliate marketing will transform your eCommerce business.

1. Indirectly grow your sales team

Your entrepreneurial juices are flowing and you’re ready to grow your eCommerce business without limits. If you’re just one person or a small group, affiliate marketing can instantly expand your indirect sales team to include experts in your niche and beyond.

Affiliates are skilled in driving quality traffic to your site.

Quality traffic = More conversions.

More conversions = Higher revenue.

Higher revenue = More opportunity to grow your eCommerce business.

A highly qualified indirect sales team that doesn’t waste time designing traditional ads, getting them approved, and tracking their progress? We’ll call that a marketing win.

2. Improve customer loyalty

Customers that continue to support your brand over time will spend 67 percent more than new customers. Affiliate marketing allows you to benefit from the trust and expertise of your chosen affiliates.

When a social influencer, affiliate marketing blogger, or celebrity signs off on your product, they bring their audience with them. G-Shock has its own set of fans and customers, but now they’re benefitting from @elorabee and her nearly 183,000 Instagram followers.

eCommerce Affiliate Marketing Image 1

3. Multiple paths to conversion

What does success look like for your eCommerce business? Unlike digital advertising, affiliate marketing allows you to choose what your successful conversion will be through manually setting incentives. Choose from conversions like:

  • Sale of a particular product.
  • Email capture.
  • Filling out a survey form.
  • Downloading a how-to guide.

You can manually set incentives through affiliate marketing by offering commissions on the success of your choice. Your eCommerce business is unique, so how you rate success should be just as distinctive.

Plus, affiliate marketing quickly gets your eCommerce website in front of more eyeballs by featuring your products across the web. Instead of working on getting 1,000 new visitors to a product page, you can leverage a high-traffic affiliate site and get visitors to your site that way.

Make sure to work with your affiliate partners to optimize the path to conversion. You should have them focus on your highest average order products and send traffic to your highest converting pages to maximize impact.

4. Better budgeting and ROI

You don’t have to spend loads of cash hoping your ads hit the right audience or that Facebook and Google’s algorithms won’t change overnight.

It doesn’t matter if your marketing budget has a couple of commas or you’re shaking your piggy bank, affiliate marketing allows you to more precisely budget for marketing campaigns.

It’s simple: Choose your conversion target. Offer commissions. Make money.

Because you only pay out when products sell, you can use your marketing budget for other revenue streams – sponsoring social media influencer posts, social media, or unique content creation optimized with your keywords.

Plus, eCommerce affiliate marketing has an incredible ROI. Since you’re paying a small percentage for each sale generated (typically 3-10%, based on your vertical), you can see a return on ad spend of 10:1 or more. After factoring in your products COGS (cost of goods sold), profit margin, and affiliate commission, you should still have room for some solid profits.

Most eCommerce affiliate marketing commissions are paid out based on a percentage of the product’s sale cost. And you can set different commissions for different affiliate partners. For example, you may want to send a coupon or loyalty site an IO (insertion order) with a commission of 3%, while sending an influential blogger an IO with a commission of 10%. Get creative! Inside your affiliate platform, you can create multiple offers for your affiliates. You just want to make sure you are as competitive as possible – check your competitor’s affiliate programs and match or beat their commission rates.

5. Enhance credibility

When an affiliate promotes your service or product, you can use that promotion to add credibility to your business. Use images, icons, or text to publicize where your brand has been used and reviewed.

Chelsea Krost, a top influencer, showcases where her brand has been publicized with an “As Seen On” section on her homepage.

eCommerce Affiliate Marketing Image 2

6. Develop brand ambassadors

People are talking about your brand, and if you’re not leading the conversation, you may be unaware of what prospective customers are reading. Affiliate marketing puts your brand in the hands of influencers who help create brand ambassadors.

When trustworthy influencers blog about your products, post photos of them or feature them in videos, they’re telling all their fans and followers that your brand is awesome. It’s approved, and 82 percent of consumers say they’re highly likely to follow a recommendation made by an influencer.

According to a survey of more than 4,000 social media users from the U.S. and Europe, an influencer:

  • Has 10,000+ followers.
  • Is someone who brands contact to help promote products and services.
  • Shares info on brands they love and reviews popular products.
  • Is considered an expert in their niche.

The influencer’s fans become your new brand ambassadors by trying the products, posting about the products, and sending even more traffic to your eCommerce site.

7. User-generated content overload

Have you ever sat down at your computer and had nothing? It’s a couldn’t-create-something-good-if-the-business-depended-on-it kind of day. One very evident way in which affiliate marketing enhances your eCommerce business is with UGC (user-generated content).

Even for the Instagrammers who don’t have mass followings, this can make a difference. Here’s why:

  • The vast majority of consumers (92 percent) say they turn to people they know for referrals above any other source.
  • Twice the amount of sales are generated through word-of-mouth compared to paid ads.
  • Nearly three-fourths of all consumers depend on social media for information about a product.
  • 84 percent of consumers say they’ll go with peer recommendations above all other advertising methods.

When your fans and followers snap photos, leave reviews, or post videos about your product, use that content as marketing power. It’s always better to have someone else say what a killer brand you have than to proclaim it yourself.

Wrap

You need an affiliate marketing strategy to enhance your relationship with customers and strengthen partnerships with businesses and social influencers you admire. While the method will call for your time and energy in the beginning, you’ll soon be well entrenched in your specific niche with time to focus on what matters to you – running your business.