I was shocked to discover, as stated on CNBC, that Amazon is significantly slashing their affiliate program commission rates from April 21st 2020.
Sure enough, I found an email in my inbox confirming the commission rate changes coming into effect.
I have long recommended Amazon Associates as one of the simplest ways for bloggers to start learning and earning from affiliate marketing.
I have even recommended it as one of the ways you can easily make your first affiliate sale online and have a dedicated post to it.
Their program was one of the first ways I started to make money online and still earn amazon affiliate commissions today.
Some people have built many niche sites that centre around using the Amazon Associates program and a drastic cut in their rates is going to cause a huge decline in many incomes online.
Yet again, it goes to show that it’s always risky online relying on one income stream and, in particular, relying on one particular affiliate program for a majority of your income.
It’s also something that many of us continue to do anyway, despite knowing this!
I feel this is a bit of a wake up call in that respect and also a reminder at how you can’t rely on the landscape online remaining the same.
You need to adjust and move with the times online if you want to remain afloat.
However, with so many people losing their jobs in 2020, understandably many more people are now turning their attention to online business.
Many Amazon Affiliates had been enjoying record sales in the midst of this 2020 chaos and likely felt relief that their business continued to thrive at this difficult time…. But that is all about to change.
Is Amazon Associates Worth It – Anymore?
Even before this change was announced, people have been asking for YEARS whether Amazon affiliate program is worth the effort.
Meanwhile, some affiliates were pulling in tens of thousands a month and creating multiple websites dedicated to promoting Amazon products.
So, how bad is this slash going to be?
Well, it’s going to be very bad indeed…. Check out the old commission rates below first.
As you can see above, commission rates go up to 10% on some products.
I was promoting a lot of products in the furniture and home improvement categories on another blog and my commission for related products was going to be 8%.
However, after April 21st, this is going to drop to just 3%.
Therefore, if someone bought an item for $100 right now, I could make $8 on that item… after April 21st, I will only make $3.
You can see a list of all the Amazon commission rate changes below……..
As you can see, the commission rates go as low as 1% and only as high as 3%.
As far as I am concerned, this is going to be a real game changer for many people and will lead to many bloggers, websites & niche site owners losing vast amounts of income.
Even some of the most popular websites on the net rely on Amazon for a chunk of their income.
Not to mention many YouTubers, who also frequently use the Amazon program to recommend products to their viewers.
Amazon have been criticised for this steep decline – some feel that a smaller decrease would have been more bearable at this, (already) difficult time.
However, some speculate that this steep rate reduction, is really just Amazons first step in phasing out their affiliate program altogether.
What do you think about this change? Will it impact you and your business? Please let me know in the comments.
If Not Amazon – Then What?
Relying solely on Amazon for anything is always going to be risky and what you do in this situation, is going to entirely depend on your business.
The trouble is, it’s difficult for other websites to compete with Amazon.
If you’re a review based site that uses Amazon as one of your primary affiliate programs, you did so for a good reason.
Amazon is one of the most popular websites online, is well trusted and is a household name.
When you send someone to Amazon from your website, they’re going to be immediately comfortable and won’t worry about making a purchase.
If you send them instead to some obscure website they haven’t seen before, then what are the chances they will leave your site and search up the same product on Amazon?!!
So, it really depends on the product and what affiliate programs are available.
You may also find that similar products on OTHER affiliate programs do not fair much better with affiliate commissions.
Therefore, in many cases, at least with case with many bloggers making recommendations to their readers, Amazon is still going to win.
How Will People Adapt?
There are many ways that people may try and adapt to this change.
a) Switching to digital products/video courses/membership programs.
Some niches could lend themselves well to switching up physical product links to digital products or courses.
This won’t be easy for many but, for example, if you have a blog in the Dog niche – you may be able to switch your primary focus towards promoting dog training, instead of dog products.
That doesn’t mean you wouldn’t still use the Amazon Associates program, but you could incorporate a higher paying program as your primary recommendation.
Digital products tend to have pretty decent commissions as well, just be sure whatever you do recommend is of high quality.
b) Shifting towards paid advertising on your blog/website.
The great thing about paid advertising is that you don’t have to make any sales to make money.
What you do need however, is plenty of traffic.
Also, joining and ad network isn’t without its ups and downs, so there is still some risk involved but right now, there seems to sign of paid advertising going anywhere!
I’m not just talking about Google Adsense here, many other company’s, (including Mediavine who I am with) that pay much more than Adsense.
Some Ad Networks will require you to have a certain amount of traffic before you join and there is an application process, but it’s definitely a reasonable option to check out.
Joining an Ad Network was a game changer for me, because it created an additional income stream for me, with zero extra work.
c) Shifting to selling your own products and services.
This may not work for everyone and is going to be dependent on your niche, but a sure way to have more control over your income is to create your OWN products.
If you have your own products, you can even have affiliates promote them for you as well.
Your product could be as simple as an ebook, or something more in depth – such as a video course or a membership program.
By growing an email list of people interested in you & your products, you can continue to sell your products to your list into the future.
Ultimately this boils down to the same old recommendation of building a brand and a following.
d) Adding additional income streams.
If you’re stumped for new affiliate programs to try, then you may just want to consider other ways you can boost your income.
For example; you could consider starting a YouTube channel, linking to your blog from that and growing a larger audeince.
As I mentioned before, building and email list and creating your own products – figuring out a product that would be helpful to your audience and creating it!
Looking into Ad Networks that could help boost your income in addition to affiliate marketing….
OR starting an entirely new side hustle altogether.
This may be a brand new website that does not rely on Amazon at all, or something entirely different.
Is This Switch Going To Be Permanent?
Apparently this is a permanent change – but I’ve only heard this from those who have contacted Amazon directly.
Some still speculate that it’s just a temporary measure and that may be adjusted in the future.
While commission rates are always subject to change – it seems that this tends to be in a downward direction, rather than back up again!
Is Affiliate Marketing Dead?
People have been speculating for years that Affiliate Marketing is dead, or on the way out.
Amazon may have slashed its commission rates, but Amazon is just one program and there are many businesses out there desperate for you to promote their products or services.
Affiliate marketing is a great way for businesses to promote their products and have their products or services be seen by people who may never have found them otherwise.
Therefore, there is still opportunity within this space. There is also still opportunity to earn money with Amazon….
It’s just going to be a lot harder to make a substantial income from Amazon alone.
Pin Me For Later!
Don’t Rely On One Thing!
Yet again, this is just a stark reminder that relying too heavily on one income source can be risky.
But these sorts of challenges are also just things you have to deal with from time to time, when you have an online business.
Sometimes they can be avoided, but more often than not they’re events you can learn from.
Some changes that can initially seem problematic, can also provide new opportunities.
Should You Become An Amazon Associate?
If you’re brand new online and only just learning about affiliate marketing, Amazon can still be a user-friendly way to get involved.
It’s simple and easy to get signed up and there are so many products on Amazon, it can be combined with practically any niche.
Because Amazon converts so well, it may be easier to get your first sale promoting amazon products, than many other things.
However, I could certainly recommend that you check out other possible options as well.
Some people have switched over from Amazon, to the Ebay affiliate program, for example.
Two entirely different platforms, but you can see how it could work in many niches.
It Sucks….. But That’s Business!
This stuff is not easy – whether online or in the real world, you are going to come across set backs, failures and forks in the road.
It’s really how you respond to these events that will determine how well your business weathers the storm.
I’m not going to say it’s been all smooth sailing for me, it certainly has not – but I’m still stumbling along on my way, making mistakes and trying to learn from them where I can.
What changes, if any, are you making to your online business after hearing about these changes?
Let me know in the comments!