Ok. I guess I'll take a stab at this...
First, you shouldn't be asking for tactical channel advice yet at this stage in my humble opinion. Here are some things to look into, that can evolve into a strategic marketing plan:
#1 Competitive Analysis -
-Who are the major players in your niche?
-What channels are they using to drive traffic to their site?
-How much traffic do they have?
-How good are their landing pages?
-How strong is their value prop?
-Are there credibility indicators / trust marks (e.g. certifications etc) they have that you don't have?
-Are they doing things that you are doing better? Worse?
-How are you differentiated from their offering?
#2 Demographic Analysis
-Who is your ideal customer?
-What motivates them to purchase?
-Where do they gather?
-What is the typical mindset of this demographic? E.g. research, purchase, browser etc
Here's a tip. Instead of guessing who you think they are, check out Quantcast data on your competitors, sites like Forbes / Motley Fool etc. You might also look at the demos on mailing lists common to your niche. You can probably dig some of that up at Nextmark.
#3 Internal Analysis
-Analysis of your current conversion rates. Think about this beyond straight conversion %, break it up into a funnel. E.g. Visitor > Product View > Shop Action (Add to Cart) > Buyer > Repeat Buyer. Consider that this is not the only conversion path. For example, generating a lead might be considered a secondary conversion goal.
-Analysis of price elasticity of demand. Would changing your price or varying the way the offer is constructed yield higher results?
-How can you improve on your landing page(s), call to action, copy, value prop etc.
-Do you have accurate anaytics in place to measure all of this?
-Have you defined KPIs to benchmark performance?
At the end of the day, how well this all works will determine success or failure. This is true whether it be PPC or Affiliate or whatever. If your conversion rates suck, you can recruit all you want, but affiliates will move on if a higher yield can be made somewhere else on their traffic and efforts. The same is true with PPC, at least if you want volume. The highest volume terms will likely be the most expensive. If you can't achieve a positive ROI then you're going to miss out on all that potential.
#4 Channel Analysis
This probably gets to where you were going in your original post. You have a lot of options here, both online and offline. Online, some off the top of my head....
-Paid Search
-Contextual
-CPM / Media Buys
-SEO
-House List Email
-Affiliate Marketing
-List Leasing / Newsletter Sponsorships
-Etc
Your goal should be to eventually incorporate ALL of these channels into a comprehensive online marketing strategy, provided you can do it at a positive ROI. Obviously you can't do all of this out of the gate, so the question is what order makes the most sense. You need to research the shit out of these areas, find opportunities and execute in a logical fashion.
Affiliate marketing, SEO and your house list will
generally provide the best ROI. SEO and building a list are longer term objectives. With that said, start with PPC
PPC is great because you get immediate feedback on how well your offer is performing. Do not go out to the affiliate world with your creative / offer until you are sure it's as good as it can be. It doesn't have to be "perfect", optimization is an ongoing process...but it does need to perform on par with offers similar to yours in the space. Otherwise, all your recruiting efforts will be for naught because people will jump ship left and right if the offer doesn't perform. Secondly, take the "low hanging fruit" you find in your PPC campaign and start doing SEO work for those long tail terms. Simultaneously begin to work on the broader terms that are going to take time. Depending on the competitiveness, this can vary a lot.
In short, to start IMHO -
-Roll a PPC campaign
-Optimize the shit out of your offer and site
-Once it's performing well, execute on an affiliate program, recruitment etc
-At the same time, begin SEO work on low hanging fruit terms
Just one guys opinion...and I left a shit ton out because I was typing really fast. Didn't intend on writing a novella, but it just sort of happened.