Affiliate marketing is one of those terms you hear about every day, but don’t really understand what it is. You see people talking about it online, but you’re never sure how it actually works.
Affiliate marketing is one of the most popular ways to generate passive income online. If you want to learn about what it takes to become successful with affiliate marketing. The global affiliate marketing industry is worth 17 billion. The US affiliate marketing industry alone will reach 8.2 billion in 2022.
This guide will help explain affiliate marketing in simple terms, and show you how to start making money with it. We’ll teach you everything from how to choose a niche to how to find affiliates and promote your products. You’ll even discover some great tools we use ourselves.
What is Affiliate Marketing?
First things first, let’s talk about exactly what affiliate marketing is. When someone clicks on an ad or visits a website, they usually have no idea that their actions were being recorded by someone else.
This person is called an affiliate marketer. They may be getting paid to advertise something, or they may be promoting another company’s product. Either way, when someone does business with them
Affiliate marketing is a form of performance marketing where affiliates earn commissions based on the amount of people they send to a merchant site via email or social media. In exchange for earning commissions, affiliates are rewarded with a percentage of each sale generated by the referrals.
In addition to generating income, affiliate programs provide value to merchants because they help promote their brand over time.
When someone visits a merchant’s site through an affiliate link, the merchant earns money regardless of whether the visitor ultimately purchases anything. This is especially useful for sites like Amazon, whose main source of revenue is derived from third party sellers rather than selling directly to customers.
As an affiliate marketer, you’ll likely generate traffic to your site and increase conversions once you build up enough trust with your audience.
You can do this by creating great content, offering high quality bonuses, and providing regular emails full of helpful tips. Once you’ve earned enough trust, you can start building relationships with your audience and promoting your affiliate offers.
How Does Affiliate Marketing Work?
Affiliate marketing is one of the most popular ways to make money online today. This type of advertising involves partnering with brands and businesses within the same industry as you offer up promotional discounts or coupons, and they give you a cut of the profits when customers use those deals to buy what you are promoting.
But how does it work exactly?
The idea behind affiliate marketing is simple: you partner with another company and earn commissions based on sales generated through your site. For example, let’s say Company X wants to sell a $100 laptop computer.
Instead of spending tens of thousands of dollars on TV ads, they outsource the job to affiliates. These are companies that already have a large audience of potential customers. If those affiliates refer visitors to Company X’s website, the company pays the affiliate a commission for each sale.
In return, the affiliate gets paid whether the visitor buys something or leaves without making a purchase. This model works well for both parties involved.
Factors to consider in Affiliate Marketing
When it comes to affiliate marketing, affiliates get paid whenever someone uses their link to create a transaction. It can be a click a submission, or a sale. Affiliate marketing is performance-based so as an affiliate you earn only if your website visitor takes action through your affiliate link.
In affiliate marketing, there are a few things involved that help you throughout your affiliate marketing journey. These factors are important, especially when choosing your affiliate products
- Commission amount/ type – there are two generally two types of commission structure: flat rate or recurring. The flat rate is mostly applicable on physical products or a one-time payment per sale. The recurring model is most popular with subscription-based products. Either way, they are both a percentage commission on a sale.
- Cookie lifetime – these are text files containing data to identify computers as you use a network. Sites store data about your users for a certain period. If a cookie lasts a day, your buyer will need to complete a purchase within 24hrs, if 30 days, they have 30 days to buy for you to claim your commission. Some sites can go even longer, 90 days even.
- Relevancy – How relevant an affiliate product is to your audience is important. You don’t want to be talking about health tips and selling your audience horse riding equipment. If you choose products that are not relevant to your audience you will only break their trust.
- Payment logistics – this is as simple as “how do you get paid” and how often you will receive payments. This is important for you to understand, sometimes you need to reach a certain amount to receive a payout. For example, the payout can be when you reach $100 in affiliate commissions.
- Promotional assets and Conversion rates – you wouldn’t want a product that’s hard to sell otherwise, you will be working hard and don’t getting people buying into your affiliate product. Products with high conversion rates are best to start with so you can generate commissions much more quicker.
Who is Involved In the Affiliate Marketing Process?
Affiliate marketing often involves the seller (Product owner, the affiliate, and the customer and Affiliate networks)
- Affiliates promote the product
- Sellers create or sell the product
- Affiliate networks manage affiliates
- Consumers buy the product or use the product.
Affiliates are content publishers either individuals or businesses who write about products or services and then include links back to the vendor’s website so that their readers can learn more about them. They may also include images and videos to enhance the experience for users.
There are many different types of affiliates including contextual, referral, display, search engine, e-mail, social media, and mobile. The best affiliates will be ones that align themselves with your business goals and target demographic.
You should always look at the terms and conditions of any affiliate program before joining. Some programs require you to join a certain number of times before you get access to the program, while others allow you to join as many times as you want. Look into all the details of the program before signing up.
Affiliate networks as previously mentioned manage affiliates. The advantage of using an affiliate network is that it gives affiliates credibility and manages the relationship between affiliates and sellers. An affiliate network is a third-party service that manages the entire process from finding new vendors to tracking sales.
An affiliate network allows affiliates to connect with other people and businesses in the same way that Google AdSense allows websites to place ads on their pages.
When someone clicks on an ad, the affiliate receives a commission. The affiliate network takes care of everything else.
Sellers or Product curators
Sellers are creators of products or services affiliates promote. A seller pays a commission to affiliates and they can be individuals or companies. In some cases, the seller might not be the creator of the product, especially for retail eCommerce stores.
The seller usually has a website where they sell their products and services. They may also offer free samples of their products.
The Consumer or buyer
Consumers are the people who buy products or services through affiliate links. When they make a purchase, the seller credits the affiliate with the agreed percentage of the sale.
Consumers are what makes affiliate marketing complete, for affiliates to make affiliate commissions, they need to have an audience of consumers of the product they are writing about.
For the affiliate marketing system to function properly, there must be sales and the consumers or customers are the ones who make them happen.
An affiliate’s job is to market products or services to consumers through various channels (social networks, blogs, etc.)
If the consumer finds the products or services useful, then he or she may click an Affiliates’ link and buy from the merchant. If the consumer buys something, then the Affiliates get paid a commission for their efforts.
You should always remember that the customer must know that you, the affiliate marketer, are earning commissions from the sale of the products you recommend.
This disclosure enables the buyer to make decisions while knowing the relationship you may or may not have with the brand that owns the product.
What are the Types of Affiliate Marketing?
Affiliate marketing is one of the most popular ways for merchants to monetize their businesses online. However, there are different types of affiliate programs out there.
Here are some examples of each type:
Unattached affiliate marketing
One of the most popular forms of affiliate marketing is called “unattached,” where affiliates aren’t tied to specific products. This allows them to market whatever they want, whether it’s a brand-new product or an established brand.
They don’t have to worry about what customers think of their recommendations. In fact, some companies even encourage their affiliates to promote competitors’ brands.
The downside is that unattached affiliates often lack credibility within their niche.
If someone sees an affiliate recommendation for a particular product, how does he know that person isn’t just trying to sell him something else? However, if you’re willing to put in the work required to establish credibility, this can be a lucrative way to make money online.
Related affiliate marketing
Affiliate marketers often promote products and services they haven’t personally experienced. They do this because they want to build credibility and authority within their niche. This is called “related affiliate marketing.”
Related affiliate marketing can be a good way to earn some extra cash, but it carries the potential for making mistakes. If you promote something you haven’t personally used, you could end up promoting a bad product or one that doesn’t live up to its claims.
Only one negative review can cause people to stop trusting you, which is a big risk to take. But as with all risks, you stand to make a higher return on investment on the products you include. And, if all goes well with you and your audience, you can even stand to grow and build more credibility for your brand.
Involved affiliate marketing
Involved affiliate marketing involves only promoting products and/or service providers that you’ve actually tried out yourself and believe in.
An influencer promotes products and brands that they believe their audience would be interested in, rather than paying for clicks on ads. Building this kind of reputation takes longer than just starting out, but it’s necessary if you want to build a sustainable business.
Avoid scams like free offers from people claiming to be affiliated with Amazon or eBay.
What Types of Affiliate Marketing Channels Can you Use?
Several channels are available for affiliate marketers to use to bring traffic and make sales.
Here are some popular options:
You can set up a blog and write content around the niche topics you have chosen to write about. Your readers will then visit your site via a referral from Google, Bing, Yahoo etc.
Blogging organically attracts visitors by helping affiliates rank in search engine result pages (SERPs). Bloggers use guides to teach visitors how to use products, pick the best options available for them.
This can be done using reviews from visitors or bloggers, videos guides and other educational content. Where ever there is linking to the seller, affiliates use their unique link to get credit for the sale.
See our guide on how to start a blog.
Paid Search Microsites
Microsites are branded pages separate from the main site used to provide a detailed sales pitch about affiliate products. Here you can tailor the message more to closing a sale for your affiliate product.
Affiliates can also promote microsites through social media platforms like Facebook, Twitter, Instagram and Pinterest.
Influencers have a large following and have a big impact in sales. A study by digital marketing institute has revealed that 49% of consumers rely on influencer recommendations for products they buy. Influencers get people in their space to buy products on social media platforms like Instagram, YouTube, and Facebook using affiliate links.
Influencer marketing can be done in many forms, sometimes make involve doing live videos on social media or product reviews.
Email marketing is one of the most popular forms of marketing with the highest return on investment.
They have a potential to bring about $35 to $45 for every $1 spent on email marketing. As an affiliate marketer it’s important to build a mailing list because this could be your biggest source of sales.
See our ultimate guide to email marketing.
Social Media Marketing
Social media marketing is another great way to drive traffic and leads to your website. It allows you to create a community around your brand and engage with customers.
It’s a great place to share content related to your affiliate products. Social media sites include Facebook, LinkedIn, Twitter, Instagram and Snapchat.
See our ultimate guide to social media marketing.
Videos are becoming increasingly popular online. People love watching video content on YouTube, Facebook, Instagram and Twitter. Video marketing helps to increase engagement and conversions.
Videos allow you to tell stories and showcase your products. You can even add interactive features such as quizzes and polls to encourage viewers to take action.
Coupon sites are very popular, they date back to the eCommerce boom. Having your affiliate link on coupon sites can bring in lots of sales for your affiliate product. Coupons are usually freebies that give discounts on purchases.
You can find coupons on websites like Groupon, Living Social, Amazon Associates and Ebay.
One affiliate marketer can use a combination of some if not all these affiliate channels for maximized results.
What are the Benefits of Affiliate Marketing?
Given the information you know about affiliate marketing you might have noticed some benefits to if already. Also if you put some work into it you will get results you desire.
Here are some of the most common benefits to starting affiliate marketing:
It is a nearly passive income stream
Just to understand affiliate marketing requires you to put some work into creating content and promoting it. The upside is because you are not directly dealing with customers to get a transaction done, you can end up making money at any time of the day.
What you need is to set up a system that collects emails, create a workflow to keep customers engaged and wait for the results.
A flexible business model
With affiliate marketing you don’t have to produce, or create products or deal with the day to day business operations and supporting customers. It’s not a 9 to 5, where when you are not present the business is not operating.
What you work on instead is a schedule that best suits out to produce and promote content. You then choose the products aligned with your content to add as recommendations for your audience to try in the form of affiliate links.
Cost effective (low cost)
Affiliate marketing is a business you can start with a low budget money. Depending on which channel you start with, video, or blogging the initial investment will be either hosting fees, camera equipment or your time.
Unlike with a product manufacturer, as an affiliate marketer your focus is on creating good content. This means you do not have to worry about customer service, inventory management, shipping etc.
The only thing you need to invest in is your time.
The more time you spend working on your affiliate marketing strategy, the better results you will achieve.
Easy to scale
If you want to grow your affiliate marketing business, you just need to make sure you are producing quality content and promoting it effectively. Once you have mastered this process, you can easily scale your efforts by hiring affiliates to help you out.
There are many ways to build an affiliate network, but one of the most common ones is through building an email list.
This allows you to send targeted messages to your subscribers and increase conversions.
A low risk business
There is not putting money into developing a product and testing if the market needs it or not. In fact you should pick proven products in the market to get your sales quicker, you have an option to leave if you it doesn’t work.
Affiliate marketing requires you to promote products to your audience and in some cases use PPC to increase that traffic. But, you have an option to not use paid media.
No need to offer customer support
One of the toughest jobs in todays’ online market is customer satisfaction. Companies are making big investments towards customer success.
The great thing about affiliate marketing is the affiliate products already have that in place, so you won’t be there supporting customers.
How Do I get started with Affiliate marketing?
To get started with affiliate marketing you need 3 things a content strategy, a website, and an audience. Once all this is in place you are on your way to seeing results.
Here are the steps you should follow to get started with your affiliate marketing.
Choose/Find a Niche
When looking for niche to build on, find a topic that you are most passionate about. This will keep you going for long in putting in the hours needed to succeed with affiliate marketing.
You should focus on addressing problems that someone interested in your content would most likely face. This way you can address these problems and offer solutions to help you user achieve something valuable.
Choose an affiliate marketing channel
Before choosing a channel, remember, affiliate marketing is not a “set and forget”. To succeed you need to be implementing a strategy that works, for both you and your audience.
After deciding on your niche, start with at least one channel to create your content. Blogging is probably the cheapest channel to go with when getting started. This works best for an affiliate marketer who wants to go the product review route.
There is YouTube where you don’t have to pay to get started, all you need is the ability to record videos and deliver great content. A number of influencers opt for Instagram as a channel for affiliate selling. Mainly because the already have a big following on the platform.
Whatever platform you go with make sure you include affiliate links in your content so you can create leads. For blogging you add a hyperlink where you are making suggested solutions, YouTube you can use the video description and Instagram you do sponsored or ad.
Choose products you want to promote
Affiliate products you pick should be related to your content. Otherwise, it will be a total waste of time to even consider giving your audience offers that are not related to what they are reading. This is because your visitors find information they are looking for when they are actively searching for solutions or trying to define the problems they may be facing.
Think about how the products you want to promote will make your audience’s life better. Will it solve the problems they are facing on a day to day? If the answer is yes, then you are on the right track.
Join an affiliate network or Program
An affiliate network will help you manage all your affiliate products in one place. If you already have a website and an audience, this is an affiliate network is a great place to start.
You can use google analytics or google search console to see who comes to your website and what they are interested in. This way you can choose the products related that relate to your audience:
Here are some top affiliate networks available;
- Impact.com – Impact is one of the most popular affiliate marketing networks. With Impact, its easy to scale for multiple contributors and a diverse audience. The admin interface is fantastic, especially the quick links feature. It has almost every top affiliate program, making it easy to locate new affiliates.
- ShareASale – The world’s largest affiliate network, Shareasale has over 1 million merchants listed on their site. They also provide tools such as reporting, tracking, and payment processing.
- Commission Junction – Commission Junction is another large affiliate network which specializes in digital goods. Their wide variety of products makes them a good choice for beginners.
- ClickBank – Clickbank is a giant affiliate network that has more than 10,000 vendors offering everything from physical products like electronics and books to services like web design and internet marketing.
- Amazon Associates – Amazon Associates is a program offered by Amazon that allows people to earn commissions by promoting other companies through their own websites.
If you are new to affiliate marketing, I recommend starting out with ShareASale.com or Impact. It’s free to sign up and list your first product. Once you build traffic and sales, you can move into other programs.
Create Quality content
You might have heard of the expression, content is King. This is because people will only love visiting your website or affiliate channel because of its content. Now that you have your affiliate products set and the links read, create quality content that aligns with those products.
Content varies depending on the type o channel you use for your marketing but, here are the common types of content you can create around the affiliate products.
Tutorials/ How to Guides
How to blogs and videos help you audience how to use products you are affiliated with. They are great because they are actionable and show your audience how to apply them to the challenges they are facing.
Product Reviews/ Comparisons
Product reviews give your audience your view on products what you love about them. Be honest when you deliver these reviews, you can even add what you believe is missing from the product.
In some cases you can even compare a product designed to do what you affiliate product does, just ensure you are honest throughout to build trust with your audience. Honesty will result in a lot of people trusting your opinion and deciding to learn more from you and follow your channel.
Case studies show how other people have succeeded using the affiliate product you are promoting. It’s a great way to show your audience what they might be missing out on. Also, it helps you further build rapport with your audience. You are basically showing them what the situation was before the product and with the product.
A resource page
Resource pages are usually a big driver of sales. A resource page will have all the products you sell with their affiliate links meaning its super easy to create.
Build an audience
To build an audience is like building a community of people chasing after the similar dreams and aspirations. An audience is built on value, so give valuable information to attract your audience. It’s an even greater approach to build a loyal audience before monetizing your content.
Building an audience is important because they will be the source of your commissions in the long run. For your audience to consider the offers you suggest to them, understand that you will need to give them free and valuable information.
Building an audience can be through using the following tactics
- Search engine optimization – see some top SEO strategies you can implement.
- Email Marketing – see our ultimate guide to email marketing.
- PPC or Paid Media – see this guide from an inbound agency on developing a PPC strategy.
Affiliate Marketing Tips to Get you Started
Once you have started keeping up is the important part. Affiliate marketing requires effort from your side to grow an audience and your authority as an affiliate marketer.
Start with product reviews
To boost your affiliate marketing efforts, Reviewing your affiliate product may be one of the easiest ways to get started.
This will also allow you to learn more about the products you promote in detail. Product reviews will show your audience you are an expert in your niche and they will most likely trust you more.
There are different ways to review products, one way is through best-of lists, comparison posts and testing products, and sharing your experience.
You don’t necessarily need to know the ins and outs of a product, or even buy a subscription to test, most of the products offer free testing so you can simply register to try out a demo and share the experience you had with the product.
Keep up with the latest trends
Keeping up with trends is important, especially since you will most likely be using social channels to promote your content. You should keep up to date with not just trends in your niche, but also in your marketing.
Crowds move with the next big thing, as in the case of Facebook, or when Tik Tok was launched. Keep up to date with the latest trends to stay relevant.
Build trust with your audience
Trust from your audience comes from you sticking with what you initially promised from the start, and being helpful in the topic you have chosen.
If you are talking about health and fitness like in the example given earlier, the products you are affiliated with have to have health and fitness benefits. If they don’t it won’t rest well with your audience.
The other important thing in building trust is you are not telling them to buy products, but recommending them based on your expert opinion. This is why you can also have a diversity of affiliate products which brings us to the next tip.
Diversify your affiliate products
Focusing on one affiliate product is risky. Think about how great it is to be able to give your audience options based on how well your products are related. Also, it gives you good content in product comparisons.
The benefit of diversifying your products is also in the form of lower risk. In case one affiliate program is canceled you can easily carry on with promoting other products related to it. This way you won’t be left in the dry if one of the products gets canceled.
Optimize your content for SEO and User Experience
Always be in touch with your analytics, and make sure all links are working correctly and your audience is being led to the wrong content. Also, use the analytics data to create a seamless user experience.
Your marketing should be data-driven to achieve your affiliate marketing goals. Remember, in marketing, you never know if things work until you try them. Some tactics will take time, and some a short time to see results.
Pay attention to what’s working and what not working, and use tools like google analytics or social media analytics tools to keep track of your social media marketing if any.
Promote your affiliate products
You can use multiple methods to promote your affiliate products. The first method would be by creating a blog post about the product. You can then link back to the product page and include the affiliate link.
Another option is to use paid media such as PPC (Pay Per Click) advertising. There are many platforms where you can advertise your affiliate products. You can also use email marketing, social media ads, and more.
Start Affiliate marketing today to grow Online
Affiliate marketing is one of the most popular ways to make extra cash online. With affiliate marketing, you don’t have to spend thousands of dollars to start making money online you just need the right tools to get started, first you can choose a web host, set up a blog, and join the best affiliate marketing programs in your niche.
Alright, that’s about it. Everything you need to know about affiliate marketing: now it’s time to put some work into it and grow your affiliate marketing business. This ultimate guide has everything you need to get started. Get started today.