Is Affiliate Marketing Right For You?
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Benson Altman, founder, CEO and president of Kosher.com in New York City, is prepared for a busy spring. That's because in February, he began a relationship with Amazon.com that enables him to sell his more than 20,000 kosher products--including everything from fresh, kosher butcher meat to kosher cosmetics-on Amazon.com.
Kosher.com's products have been integrated into Amazon.com's catalog, so customers can purchase them seamlessly. Kosher.com then ships the products to customers, and Amazon.com handles everything else, such as first-level customer support and billing.
The benefits of working with Amazon.com are many. "We expect that our sales will increase 10 percent to 20 percent as a result of this partnership," says Altman, whose company projects sales of $2 million in 2006. Amazon.com also offers Kosher.com opportunities to promote its brand. While Kosher.com isn't referenced on the site, customers see the Kosher.com brand when they receive their merchandise. "The partnership will allow Kosher.com to get our name out there and make ourselves available to people," says Altman, 40.
Could this type of arrangement be good for your business? Before moving forward, keep the following in mind:
1. Consider the costs. It cost about $25,000 to integrate Kosher.com's back end with Amazon.com. And Amazon.com gets a commission on every sale. Altman also hired four additional employees to keep up with the extra business.
2. Make sure you can handle large orders. Before you sign on the dotted line, "make sure you've got the ability--and the inventory--to fulfill the orders," Altman says. "It's essential."
3. Get your technology up to speed. Says Altman, "The back-end system required to deal with Amazon.com is extremely complex and not for the faint of heart."
4. Realize that the partnership is a major commitment, and run a good business. In general, Altman says that for a relationship like this to work, you have to run a professional, sophisticated business. "Your packages have to be on time, your orders have to be correct, and your customer service has to be great," says Altman. "If customers have too many complaints about you, [Amazon.com] can drop you."