As an online marketer, I am usually asked what is actually an ‘affiliate’ when I tell someone about my job. If you are new to digital marketing you might also be wondering what is an Affiliate, how does Affiliate Marketing works and how to make money with it.
In the Affiliate Marketing model, an ‘affiliate’ is someone who recommends a product to their own customers or audience, in exchange for a commission if they decide to purchase it. Affiliates are not part of the company and usually promote a few different brands in their niche.
This is obviously beneficial for both sides. Having ‘affiliates’ allows the company to reach a certain audience without incurring in other marketing costs – such as ads – and promoting the products gives the affiliate a way to monetize their platform or following.
Now that we know what an affiliate is, let’s take a deeper look at affiliate marketing.
Note: The term affiliate has a different meaning in corporate law and taxes, but for the purpose of this article and what concerns us we have focused on the marketing meaning of it.
What is Affiliate Marketing?
As mentioned before, affiliate marketing is a form of digital marketing where you refer someone to any online product and, if that person buys it, you receive a commission. Affiliate marketing is one of the most popular ways people make money online and for some it can be a passive income once established.
History of Affiliate Marketing
Affiliate Marketing may seem like an internet invention but actually, the concept of revenue sharing (paying commission for referred business) precedes the online world.
Affiliate marketing as we know it today, saw its beginnings in 1989, when American entrepreneur William J. Tobin, founder of PC Flowers and Gifts, noticed the potential of virtual promotion and created Prodigy – which became known as the first Affiliate Marketing Program in history.
With the exponential growth and reach of the internet, first e-commerces noticed the opportunity and small initiatives following the same concept started to emerge in the United States.
That’s when a connection between e-commerces, websites owners, and the final consumer, was established.
The big kid in the game: Amazon
In July 1996, Amazon popularized the practice by launching an Affiliate Program. Amazon associates could place banner or text links on their site for individual books, or link directly to the Amazon home page.
When visitors clicked on the associate’s website to go to Amazon and purchase a book, the associate received a commission.
Amazon was not the first merchant to offer an affiliate program, but its program was the first to become widely known and serve as a model for later programs
Beyond the blog
Nowadays, the creation of new media platforms, give affiliates more opportunities to offer their promoted products. Channels like youtube and social media have spread the affiliate opportunity beyond bloggers and website owners.
At the beginning, bloggers would look at affiliate marketing as an extra stream of income for something they created out of pure passion. Today, affiliates do things a bit different by picking an offer they want to promote first, and then coming up with a strategy to promote without a website or blog.
Currently, there’s a huge market for Affiliate Programs, specifically in the commerce of digital products. Although we are not against any legit promotion method, we still think website and blog are the better and most passive long term strategy for affiliate marketing.
How Does Affiliate Marketing Work?
Believe it or not, an affiliate marketing business is probably one of the most profitable and passive you’d likely to come across. However, to those on the outside, the inner workings of affiliate marketing can be mysterious and confusing.
Here are 5 simple steps that explain the basics of how affiliate marketing works:
- Affiliates promotes products or services on their site or platform.
- Visitors clicks on the affiliate’s link to the product. A cookie (code) is stored on the consumer’s browser which makes it possible to track the potential sales.
- Consumer is redirected to brand’s website.
- Consumer purchases a product/service from the brand.
- The affiliate network automatically pays out a commission to the affiliate (based on the rules set by the brand) for driving that sale.
Benefits of Affiliate Marketing
Interested in affiliate marketing? Here are some other benefits to – hopefully – drive you to take action.
Low to no risk
I know many people who have lost their savings in the pursuit of an e-commerce or Amazon business. The problem is that most virtual shops fail due to a lack of planning and experience. Affiliate Marketing is a safe alternative that doesn’t require that kind of investment.
You don’t need your own product
Not long ago the idea of running a full times business without any product of your own seems far and unlikely, which at the same time created a barrier to enter the market. With affiliate marketing you don’t need to create a product to start making money online, You can promote products that were created and optimized by other people. This means you can profit without worrying even worrying about fulfillment.
No more bosses
Once you start making money as an affiliate, you will be able to reap the benefits of working from home, make your own schedule and even traveling while you do so.
Possibilities are endless
As an Affiliate, you can promote literally any product un the market (as long as it works with your niche of course). You can test different offers without much trouble and stick to the ones that bring you more profit.
No worrying over costumer support
The sales are made through the companies website and they are in charge to deal with all the post-sale support. You only have to promote the link and don’t need to worry about anything else.
Payments are guaranteed
All payments are managed by affiliate programs, which means the commissions are calculated automatically after the sale, eliminating any risk of mistakes or fraud. The affiliate program acts as a mediator guaranteeing the protection of both the affiliate and the company.
Scaling to the moon
No matter how small you start, once you find what works best for you, you can replicate it and keep growing your business, since you don’t need to allocate any time to taking care of other processes.
How To Get Traffic To Your Affiliate Offers?
One of the main reasons why most newbie affiliate marketers give up after 3 months is because they can’t get traffic to their affiliate website or links. Mastering traffic is one of the keys to be a successful affiliate but it can take some time to find a master your perfect traffic source.
Here are some factors that you can work on to get targeted traffic to your affiliate offers:
Create great content
Creating useful evergreen content takes time, effort and dedication but is also one of the cheapest way to get eyes on your offers. Depending on what you are most comfortable with you can create a blog, a youtube channel, a Facebook group or even an Instagram account.
Practice effective SEO techniques
Whether it is for your blog or youtube channel, you want to make sure your content is created based on what people are looking for. This is achieved by doing keyword research to find out searches with enough volume what not too much competition.
As a beginner you want to go for ‘low term keywords’ to have a greater chance to appear on google’s (or youtube’s) top results. Going for “How to lose 10 lbs. in a month as a vegan” will give you better chances than going for “weight loss”
The majority of affiliate marketers pay for their traffic via platforms like Facebook, Google Adwords, and other ad networks. When using paid ads, you want to be careful to not send them to your affiliate links directly since most platforms and brands do not allow them. It’s always best to send social traffic to your own landing page on your site.
Building up a solid email list of subscribers is one sure way to bulletproof your affiliate income for the long term. If you do it right, you will have an audience of highly targeted members interested your affiliates offers. To learn more about why you need to build an email list for affiliate marketing and exactly how to do it check out this article.
Affiliate Marketing Frequently Asked Questions
We receive a lot of questions about affiliate marketing. Here is a compilation of all the most common ones:
How much can you make as an affiliate?
0 to millions. Part of the allure of affiliate marketing is that its potential is limitless. Do not get me wrong, it is not a get-rich-quick scheme (are those even a thing?), but how much you make will depend only on yourself, your consistency and strategy.
Do I need a website for affiliate marketing
I can see how the idea of creating a website can be intimidating for some. The answer is no, you can always use methods such as PPC or advertising to promote a product. However, I believe a blog or website to be the best promotional tool.
Check out this post on 11 ways to do Affiliate Marketing without a website.
How to find new products to promote?
Affiliate marketplaces like Shareasale and Maxbounty, to name a few, are the best places to start your affiliate marketing research. You can browse your niche and see the top-performing affiliate programs.
Alternatively, you can keep an eye on blogs and websites in your niche and see which products they are promoting and what methods they are using.
What is an Affiliate link?
Once you sign up for an Affiliate Program, you will be able to get your own link to the products you are promoting. These links will take customers to product pages but are also coded to track your sales and therefore, commissions.
Now that you know what an affiliate is and how they make their money, you won’t look so surprised next time you meet one. Or maybe you will become an affiliate and be the one telling people about it.
If you want to learn more about Affiliate Marketing and how you can make money with it, make sure to check this free Masterclass by 7-figures Affiliate, Spencer Mecham