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You need two special ingredients to make this marketing strategy work successfully. You will need a product that your target audience will perceive as being extremely valuable and something that you can afford to giveaway.
What is this secret, you ask? Tell your visitors they can have your product at no cost if they advertise your web site.
You can make your product extremely valuable by selling it. Write up a persuasive, full page ad for the product & set up a real ordering system. The higher the price you charge, the more people perceive it as being valuable. A word of warning, don't price it at an unbelievably high price.
So how can you afford to giveaway a high priced product? Simple. Write an information product that can be delivered over the Internet. For example, ebooks, fee based web sites, reports, etc. You won't have production or shipping costs.
Now the strategy kicks in. A person visits your web site, sees the ad for your information product and perceives that product as being valuable.
Right after the price of your product, tell them they can get the product at no cost, if they agree to either place your ad on their home page or run your ad in their e-zine for a specific amount of time.
If they don't have a web site or e-zine, you can also set up a script so they could refer 3 to 5 friends or e-mail your home page to a friend.
You win either way! Free web site marketing or you will make a huge profit. And it's viral; when one person promotes your web site you'll get new visitors to promote your web site and so on.