The private label bottled drinking water is a growth industry with double digit growth and profit opportunities for the entrepreneur. But like most opportunities care must be taken to seek out and exploit the most profitable niche in the market.

A recent market study examined the growth and potential of the market for bottled water and concluded:

"The bottled water industry grew about 10% in 2005, while carbonated soft drinks revenue is essentially flat," says Gary Hemphill, marketing director of BMC. "There are a couple of things driving the market—sure, people like to have a tap water substitution, but it's really driven by people's demands for a healthier alternative to the wide array of beverages on the market."

Private label water is the fastest growing segment of the overall bottled water market and its future growth is considered by many to be “explosive”. .

Private label water combines the purity of refreshing drinking water with consumable advertising that is designed to an individual customer’s specification. The water is popular and the branding message, if designed properly, serves to promote business.

Almost every company in the United States can benefit from private label water with a custom branding message. The opportunities are huge, the market is largely untapped and the private label product is viewed by customers as a cost effective, power way to promote a brand message.

The bottled water industry consists of a number of interrelated parts including research and development, manufacturing, marketing and sales. Much of the business model however, requires significant amounts of capital and has high barriers to entry for most entrepreneurs.

Nevertheless, with the advent of the internet and e-commerce, an aggressive sales focused entrepreneur can develop a substantial profitable private label business through affiliate programs .

What Are Affiliate Programs?

Affiliate programs are revenue sharing programs between an entrepreneur and a company that manufactures and sells a product or service. Affiliates are rewarded with referral payments for sending customers to the manufacturer’s Web site. The process works as follows:

• The affiliate place links on its site to a particular manufacturer’s Web site.

• When a visitor clicks on the link and makes a purchase the affiliate earns a referral fee that is a percentage of the total sale.

• The best manufacturer sites have automatic payment mechanisms and real time accounting.

But an efficient affiliate site requires planning and work. Many affiliates believe they will be able to just put up a Web site, establish some affiliate links and sit back and wait for streams of cash to start coming in. Care must be taken however to be truly successful. Consider the following:

• What type of Web site should you have to make money through affiliate programs?

• What are the best programs for your site?

• How will you effectively market your site and the underlying product?

• How can you find niche markets?

Similar to other facets of developing a home business, careful planning is needed to map out a profitable strategy for building a home based business using affiliate programs - a strategy that will allow you to build income through content in a sustainable, month after month way.

The issue is – what are the steps required to develop an income producing web site using affiliate programs that generate consistent, substantial revenue?

Tip Number 1: Align With a Manufacturer That Produces A Quality Product With Unique Features and Manages a Robust Affiliate Program.

As any good sales person will tell you, a high quality product is mandatory for sales success. Look for a company that manufactures (resellers add little value) a quality product that is recognized as different in the marketplace. There are many types of water in the market but purified water is clearly recognized as the highest quality.

After identifying a manufacturer with a quality product offering, chose one with a robust, profitable affiliate program. This should include at a minimum:

• commitment to affiliate success

• commission plans that are substantial

• a website that allows for easy ordering and accrual and payment of commissions

• support for marketing, selling and booking of orders

Tip Number 2: Identify a Niche Market and Create a Plan to Penetrate That Niche Deeply

Avoid the tendency to mass market and “shoot at the flock”. Mass marketing is beyod the scope of most companies and entrepreneurs. There are many profitable niche markets that have significant growth potential. Identify a niche market, understand the buying patterns of that niche and penetrate the market. It takes time and work but done right this effort is very profitable.

Some examples of niche markets: hotels (small and large), health spas, golf courses, gyms, car dealerships, organizations and health clubs to name a few. Almost any organization is interested in promoting their brand and brand message in a cost effective way.

Tip Number 3: Create an Eye Catching Website With a link to The Manufacturer

One of the advantages of an affiliate program is that profitable business can be developed with only a nominal investment. Given today’s technical level of internet development expertise, creation of an attractive web site is easy and cost effective. The critical part of the website however is the creation of a focused message presented in an attractive manner.

Following the creation of the site, establish a banner link with the chosen manufacturing partner that will direct affiliate inquires to the site for order creation and booking of the affiliate commission.

The manufacturer’s site must be able to design and produce labels, provide powerful e-commerce facilities for order booking and shipment and include a facility for the booking and payment of commissions to the affiliate.

Tip Number 4: Create and Implement a Sales Strategy

A clear sales strategy is the most effective path to success and profits in the private label business. Identify in writing the target niche, strategy to penetrate that niche, buying patterns, target prospects and communication material (sales collateral) and tactics to sell targeted prospects. Then implement the strategy in an organized manner and make adjustments to the strategy as conditions change. Remember the old sales adage “Always Be Closing”.

Tip Number 5: Follow Up on All Orders and Provide Feedback to Customers

As part of any effective sales effort, follow up and feedback with and to customers is critical to maintaining good customer service and obtaining repeat orders. One of the most powerful aspects of private label water sales is that happy customers tend to be repeat customers. Creation of a long customer list with satisfied customers will generate a steady stream of repeat orders and significant cash flow.