Are you familiar with affiliate marketing? Yes, that invitation that sometimes comes to you where you are invited to earn money at any time and from anywhere, even while you sleep… That’s exactly what we are talking about.
There are many companies that use affiliate marketing, as it is an excellent way to boost sales and generate significant revenue online. Even those who have tried it say that it is extremely beneficial for both brands and affiliate marketers… We can say that the new push towards less traditional marketing tactics has paid off.
What is affiliate marketing?
Affiliate marketing or affiliate marketing is the process by which an affiliate earns a commission for marketing the products of another person or company. Under this method, the affiliate simply searches for a product they like, then promotes it and earns a share of the profits from each sale they make. The sales are then tracked through affiliate links from one website to another.
Spending on affiliate marketing 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.
Today, we’re bringing you a step-by-step beginner’s guide that will tell you how to launch your affiliate marketing business and what benefits you can expect.
How does affiliate marketing work?
Because affiliate marketing works by dividing the responsibilities of marketing and product creation between parties, it leverages the skills of a variety of individuals for a more effective marketing strategy, while providing contributors with a share of the profits.
For affiliate marketing to work, three different parties must be involved:
1. The marketer and the product creators.
The marketer, whether a solo entrepreneur or a large company, is a salesperson, merchant, product creator or retailer with a product to market. The product can be a physical object, such as household items, or a service, such as makeup tutorials.
Also known as the brand, the marketer does not need to be actively involved in marketing, but can also be the advertiser and benefit from the revenue sharing associated with affiliate marketing.
For example, the seller could be an e-commerce merchant who has started a dropshipping business and wants to reach a new audience by paying affiliate sites to promote their products or service.
2. The affiliate or publisher.
Also known as a publisher, the affiliate can be an individual or a company that markets the seller’s product in a way that appeals 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 ends up purchasing the product, the affiliate receives a share of the revenue earned.
Affiliates usually have a very specific audience to target, usually adhering to the interests of that audience. This creates a defined niche or personal brand that helps the affiliate attract consumers who are most likely to act on the promotion.
3. The consumer.
Of course, for the affiliate system to work, there has to be sales, and the consumer or customer is the one who makes the sales.
The affiliate will market the product/service to consumers through the necessary channels, be it social media, a blog or a YouTube video, and if the consumer finds the product valuable or beneficial to them, then they may follow the affiliate’s link and make the purchase on the merchant’s website. If the customer purchases the item, the affiliate receives a share of the revenue earned.
However, keep in mind that the customer must know that you are the affiliate and receive a commission on the product.
The Federal Trade Commission explains that an affiliate marketer must clearly and conspicuously disclose its relationship with the retailer, thus allowing the consumer to decide how much weight to place on your recommendation.
A disclaimer such as “The products I’m going to use in this video were given to me by company X” provides your viewers with the information they need and allows them to make an informed decision about whether or not to purchase the affiliate product.
Types of affiliate marketing
It is usually unclear whether an affiliate marketer has actually used the product they are promoting or if they are just in it for the money; although usually, in the case of dietary services or skin care products, the customer may not trust an affiliate unless they know they have tested and approved the product themselves.
In 2009, renowned affiliate marketer Pat Flynn categorized affiliate marketing into three types:
In the unlinked business model, the affiliate marketer has no connection to the product or service he is promoting. He has no expertise or authority in the product’s niche, nor can he make claims about its use.
Typically, a non-linked affiliate will run campaigns of PPC (pay-per-click) marketing using an affiliate link in the hope that buyers will click on it and make a purchase on their own.
Although unlinked affiliate marketing can be attractive because of its lack of commitment, it is generally for those who simply want to generate revenue without investing in the product or customer relationship.
Related affiliate marketing is a middle ground between unlinked and implied, and targets those who do not necessarily use the product or service, but are related in some way to the niche audience. These affiliates usually have some sort of influence in the niche and an established following, so they can offer some authority.
For example, maybe you’re promoting a brand of clothing you’ve never worn, but you have an audience through a fashion blog or YouTube channel. In this case, you would be considered a related affiliate marketer.
The advantage of this type of affiliate marketing is that the marketer has the experience to generate traffic, however, you may risk recommending a bad product or service if you have never used it before, which may cost you the trust of your audience.
Involved or implied.
As the name implies, involved or implied affiliate marketing describes those who are closely tied to the product or service they promote. The affiliate has tried the product themselves, is confident that it will provide a good experience, and has the authority to make claims about its use.
Rather than relying on pay-per-click, the affiliate marketers involved use their personal experiences with the product to market, and customers can trust them as reliable sources of information.
Of course, this type of affiliate marketing requires more work, creativity and time to build credibility, but it is likely to generate higher profits in the future.
How do affiliate marketers get paid?
Affiliate marketing is a quick and inexpensive method of making money without the hassle of selling a product, so it has an undeniable appeal to those looking to increase their online income. But how does an affiliate get paid after linking the marketer to the consumer?
The answer can be complicated.
It is not always necessary for the consumer to purchase the product for the affiliate to receive a commission. Depending on the program, the affiliate’s contribution to the salesperson’s sales will be measured differently.
The affiliate can get paid in several ways:
This is the standard affiliate marketing structure In this program, the merchant pays the affiliate a percentage of the product’s selling price after the consumer purchases the product as a result of affiliate marketing strategies. In other words, the affiliate must actually get the investor to invest in the affiliate’s product before being compensated.
Pay per lead.
A more complex system, pay-per-lead affiliate marketing programs compensate the affiliate based on lead conversion. The affiliate must persuade the consumer to visit the merchant’s Web site and complete the desired action, whether it is filling out a contact form, signing up for a product trial, subscribing to a newsletter, or downloading software or files.
Affiliate marketing is largely about generating traffic to websites and trying to get customers to click through and take an action. Therefore, the myth that affiliate marketing is all about SEO (search engine optimization) comes as no surprise.
However, although organic traffic is free, SEO simply cannot sustain affiliate marketers in such a saturated market, which is why some affiliate marketers use PPC.
PPC (pay-per-click) programs focus on incentivizing the affiliate to redirect consumers from their marketing platform to the merchant’s website. This means that the affiliate must entice the consumer to the point where the consumer moves from the affiliate’s site to the merchant’s site. The affiliate gets paid based on increased web traffic.
There are two common concepts in PPC:
– CPA (cost per acquisition): With this model, the affiliate gets paid each time the seller or retailer acquires a lead, which is when an affiliate link takes the customer to the merchant’s online store and the customer takes an action, such as subscribing to an email list or filling out a “Contact Us” form.
– EPC (earnings per click): This is the measure of average earnings per 100 clicks for all affiliates in a retailer’s affiliate program.
In this payment system, the affiliate gets paid each time it directs a user to the merchant’s website and installs a product, usually a mobile app or software.
So, if a merchant budgets an offer of $0.10 for each install generated through an affiliate program, and the campaign results in 1,000 installs, the merchant will pay ($0.10 x 1,000) = $100.
Why be an affiliate marketer?
- Passive income.
While any “normal” job requires you to be at work to earn money, affiliate marketing offers you the chance to earn money while you sleep. By investing an initial amount of time into a campaign, you will see an ongoing return on that time as consumers purchase the product in the days and weeks that follow.
Plus, you get paid for your work long after it’s done. Even when you’re not in front of your computer, your marketing skills will earn you a steady stream of income.
- No customer service.
Individual marketers and companies offering products or services have to deal with their consumers and make sure they are satisfied with what they have purchased.
Thanks to the structure of affiliate marketing, you never have to worry about customer service or customer satisfaction. The affiliate marketer’s entire job is to link the salesperson with the consumer. The salesperson handles any complaints from the consumer after you receive your commission for the sale.
- Work from home.
If you are a person who hates going to the office, affiliate marketing is the perfect solution. You’ll be able to launch campaigns and receive income from the products that marketers create while working from the comfort of your home. It’s a job you can do without getting out of your pajamas.
Most businesses require initial start-up fees as well as cash flow to fund the products you sell. However, affiliate marketing can be done at a low cost, which means you can get started quickly and without a lot of hassle. There are no unexpected fees to worry about and you don’t need to create a product. Getting started in this line of work is relatively easy.
- Comfortable and flexible.
Since you are essentially becoming a freelancer, you have maximum independence to set your own goals, redirect your path when you see fit, choose the products you are interested in and determine your own schedule
. This convenience means you can diversify your portfolio if you want or focus only on simple, straightforward campaigns. Plus, you’ll be free from company restrictions and regulations, as well as poorly performing teams.
- Performance-based rewards.
With other jobs, you could work 80 hours a week and still earn the same salary. The beauty of affiliate marketing is that it’s based solely on your performance. You’ll get out of it what you put into it. Honing your reviewing skills and writing compelling campaigns will translate into direct improvements in your income – you’ll finally get paid for the excellent work you do!
Common Types of Affiliate Marketing Channels
Most affiliates share common practices to ensure that their target audience is engaged and receptive to buying the promoted products. But not all affiliates advertise products in the same way. In fact, there are several different marketing channels they can leverage.
An influencer is a content creator who has the power to influence the purchasing decisions of a large segment of the population.
This person is in a great position to benefit from affiliate marketing, as they have an impressive following, so it is easy for them to direct consumers to the marketer’s products through social media posts, blogs and other interactions with their followers. Influencers then receive a share of the profits they have helped create.
Influencer marketing campaigns are especially popular on Instagram and TikTok, where brands partner with influencers who are considered experts or authorities in their specific niches. Depending on the arrangement, a campaign may consist of a series of product reviews with photos, account shots or live videos.
While an influencer may have their own brand and aesthetic, it is important to add elements that relate to your brand to ensure brand recall and recognition. This can be achieved using apps like Instasize, where you can quickly edit and customize your campaign creatives in a tap.
With the ability to rank organically in search engine queries, bloggers are great for increasing a marketer’s conversions through content marketing. The blogger tests the product or service and then writes a comprehensive review that promotes the brand in a compelling way, which drives traffic to the marketer’s site.
The blogger is rewarded for his or her influence by spreading the value of the product, helping to improve the vendor’s sales.
- Microsites focused on paid search.
The development and monetization of microsites can also generate a lot of affiliate sales. These sites are advertised within a partner site or in a search engine’s sponsored listings.
They are distinct and separate from the organization’s main site. By offering more focused and relevant content to a specific audience, microsites lead to increased conversions due to their simple and direct call to action.
- Email lists.
Despite its older origins, email marketing or email marketing is still a viable source of affiliate marketing revenue. Some affiliates have email lists that they can use to promote the marketer’s products. Others may take advantage of email newsletters that include hyperlinks to products, earning a commission after the consumer purchases the product.
Another method is for the affiliate to build an email list over time. They use their various campaigns to collect mass emails, and then send emails about the products they are promoting.
- Big media websites.
Designed to create a huge amount of traffic at all times, these sites focus on building an audience of millions of people.
These websites promote products to their mass audience through the use of contextual banners and affiliate links. This method offers superior exposure and improves conversion rates, resulting in top-notch revenue for both the marketer and the affiliate.
One of the most well-known sites is Amazon’s affiliate program, Amazon Associates, which has the largest market share of affiliate networks (46.15%).
Affiliate marketing programs
Or, if you prefer, you can even contact retailers directly and see if they offer an affiliate program. If not, they may be willing to offer you a special coupon or discount code to share with your audience to help them drive traffic to their online store.
Tips to help you become a successful affiliate marketer
ready to give affiliate marketing a try? Here are our top online marketing tips to help you get started.
Develop a relationship with your audience.
As you begin your affiliate marketing career, you’ll want to cultivate an audience that has very specific interests. This will allow you to tailor your affiliate campaigns to that niche, which will increase the likelihood of conversion. By establishing yourself as an expert in one area rather than promoting a wide variety 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 can promote. You’ll be able to choose products you personally believe in, or even products from your favorite brands, so make sure your campaigns focus on truly valuable products that consumers will enjoy. You’ll get an impressive conversion rate, and at the same time, you’ll give reliability to your personal brand.
You’ll also want to get really good at email outreach to work with other bloggers and influencers. Use tools to collect people’s contact information and send personalized emails to get guest blogging and affiliate opportunities.
Start reviewing products and services.
Focus on reviewing products and services that fall into your niche. Then, leveraging the relationship you’ve built with your audience and your expert position, explain to your readers why they would benefit from purchasing the product or service you’re promoting.
Almost anything sold online can be reviewed if an affiliate program is in place: you can review physical products, digital software or even services booked online, such as ridesharing or resort booking.
It is especially effective to compare this product with others in the same category. Most importantly, make sure you generate detailed and articulate content to improve conversions.
Use multiple sources.
Instead of focusing only on an email campaign, also spend time on a blog, creating landing pages, posting on review sites, reaching out to your audience on social media and even pursuing multi-channel promotions.
Test various digital marketing strategies to see which one your audience responds to the most. Use this technique frequently.
Choose campaigns carefully.
No matter how good your online marketing skills are, you will make less money with a bad product than with a valuable one. Take the time to study the demand for a new product before promoting it.
Be sure to research the vendor carefully before partnering. Your time is worth a lot, and you must be sure you are spending it on a product that is profitable and on a vendor you can believe in.
Keep up with trends.
There is a lot of competition in the affiliate marketing arena. You need to make sure you stay on top of new trends to remain competitive. In addition, you can probably benefit from at least some of the new marketing techniques that are constantly being created.
Make sure you stay up to date on all of these new strategies to ensure that your conversion rates, and therefore revenue, are as high as possible.