What is Affiliates Marketing?
Affiliate marketing is a performance-based marketing strategy where businesses reward affiliates (partners) for driving traffic, leads, or sales to their products or services through the affiliate’s marketing efforts.
What if you could make money at any time, from anywhere — even while you sleep?
This is the concept behind affiliate marketing.
Affiliate marketing is the process by which an affiliate earns a commission for marketing another person’s or company’s products. The affiliate simply searches for a product they enjoy, then promotes that product and earns a piece of the profit from each sale they make. The sales are tracked via affiliate links from one website to another.
Affiliate marketing is a great way to drive sales and generate significant online revenue. Extremely beneficial to both brands and affiliate marketers, the new push toward less traditional marketing tactics has certainly paid off.
In fact, affiliate marketing spend in the United States increased from $5.4 billion in 2017 to $8.2 billion in 2022— which means there’s plenty of room for those looking to get a piece of the pie.
This step-by-step beginner’s guidewill walk you through how to launch your affiliating marketing business and what benefits you can expect.
How Does Affiliate Marketing Work?
Because affiliate marketing works by spreading the responsibilities of product marketing and creation across parties, it leverages the abilities of a variety of individuals for a more effective marketing strategy while providing contributors with a share of the profit. To make this work, three different parties must be involved:
- 1-Seller and product creators.
- 2-The affiliate or advertiser.
- 3-The consumer.
Seller and product creators.
The seller, whether a solo entrepreneur or large enterprise, is a vendor, merchant, product creator or retailer with a product to market. The product can be a physical object, like household goods, or a service, like makeup tutorials.
Also known as the brand, the seller does not need to be actively involved in the marketing, but they may also be the advertiser and profit from the revenue sharing associated with affiliate marketing.
For example, the seller could be an ecommerce merchant that started a dropshipping business and wants to reach a new audience by paying affiliate sites to promote their products. Or the seller could be a SaaS company that leverages affiliates to help sell their marketing software.
The affiliate or publisher.
Also known as a publisher, the affiliate can be either an individual or a company that markets the seller’s product in an appealing way to potential consumers. In other words, the affiliate promotes the product to persuade consumers that it is valuable or beneficial to them and convince them to purchase the product. If the consumer does end up buying the product, the affiliate receives a portion of the revenue made.
Affiliates often have a very specific audience to whom they market, generally adhering to that audience’s interests. This creates a defined niche or personal brand that helps the affiliate attract consumers who will be most likely to act on the promotion.
The consumer
Of course, for the affiliate system to work, there needs to be sales — and the consumer or customer is the one who makes them happen.
The affiliate will market the product/service to consumers through the necessary channel(s), whether it be social media, a blog or a YouTube video, and if the consumer deems the product as valuable or beneficial to them, then they can follow the affiliate link and checkout on the merchant’s website. If the customer does purchase the item, then the affiliates receives a portion of the revenue made.
However, keep in mind that the customer must be aware that you, the affiliate, are receiving a commission off the product.
According to the Federal Trade Commission, an affiliate marketer must clearly and conspicuously disclose their relationship to the retailer, thus allowing the consumer to decide how much weight to give your endorsement.
A disclaimer such as “The products I’m going to use in this video were given to me by Company X” gives your viewers the information they need and allows them to make an informed decision about whether or not to buy the affiliate product.
Types of Affiliate Marketing Models
- Pay-Per-Sale (PPS): Affiliates earn a commission when their referral results in a sale. This is the most common model.
- Pay-Per-Click (PPC): Affiliates earn money based on the number of visitors they direct to the merchant’s site, regardless of whether a sale is made.
- Pay-Per-Lead (PPL): Affiliates earn a commission when their referral results in a lead (e.g., filling out a form, signing up for a trial).
- Pay-Per-Install (PPI): Affiliates earn money when their referral results in the installation of an app or software.
Tips to Help You Become A Successful Affiliate Marketer
Ready to try your hand at affiliate marketing? Here are our top online marketing tips to help you get started.
Develop a rapport with your audience.
When beginning your affiliate marketing career, you’ll want to cultivate an audience that has very specific interests. This allows you to tailor your affiliate campaigns to that niche, increasing the likelihood that you’ll convert. By establishing yourself as an expert in one area instead of promoting a large array of products, you’ll be able to market to the people most likely to buy the product.
Make it personal.
There is no shortage of products you’ll be able to promote.
You’ll have the ability to pick and choose products that you personally believe in, or even products from your favorite brands, so make sure that your campaigns center around truly valuable products that consumers will enjoy. You’ll achieve an impressive conversion rate while simultaneously establishing the reliability of your personal brand.
You’ll also want to get really good at email outreach to work with other bloggers and influencers. Use a tool like ContactOut or Voila Norbert to gather people’s contact information and send personalized emails to garner guest blogging and affiliate opportunities.
Start reviewing products and services.
Focus on reviewing products and services that fall within your niche. Then, leveraging the rapport you have created with your audience and your stance as an expert, tell your readers why they would benefit from purchasing the product or service you are promoting.
Almost anything sold online can be reviewed if there is an affiliate program — you can review physical products, digital software or even services booked online, like ride-sharing or travel resort booking.
It is especially effective to compare this product to others in the same category. Most importantly, make sure you are generating detailed, articulate content to improve conversions.
Use several sources.
Instead of focusing on just an email campaign, also spend time making money with a blog, creating landing page, posting on review sites, reaching out to your audience on social media and even looking into cross-channel promotions.
Test a variety of digital marketing strategies to see which one your audience responds to the most. Make frequent use of this technique.
Choose campaigns with care.
No matter how good your online marketing skills are, you’ll make less money on a bad product than you will on a valuable one. Take the time to study the demand for a new product before promoting it.
Make sure to research the seller with care before teaming up. Your time is worth a lot, and you want to be sure you’re spending it on a product that is profitable and a seller you can believe in.
Stay current with trends.
There is serious competition in the affiliate marketing sphere. You’ll want to make sure you stay on top of any new trends to ensure you remain competitive.
Additionally, you’ll likely be able to benefit from at least a few of the new marketing techniques that are constantly being created.
Be sure you’re keeping up to date on all these new strategies to guarantee that your conversion rates, and therefore revenue, will be as high as possible.
