What Is Affiliate Marketing (And How to Get Started)?

Wake up at an ungodly hour. Drive to the office through total gridlock, streets jammed with other half-asleep commuters. Slog through email after mind-numbing email until the sweet release at five o’clock.

Sound terrible?

What if, instead of dealing with the monotony and stupor of the rat race to earn a few bucks, you could make money at any time, from anywhere—even while you sleep?

That’s the concept behind affiliate marketing.

Affiliate marketing is a popular tactic to drive sales and generate significant online revenue. Extremely beneficial to both brands and affiliate marketers, the new push towards less traditional marketing tactics has paid off. In fact,

  • Affiliate marketing is used by 81 percent of companies and 84 percent of publishers, a ratio that will continue to rise as affiliate marketing spending in the United States rises year after year.
  • Affiliate marketing spending in the United States is increasing at a rate of 10.1 percent each year, bringing the total to $6.8 billion by 2020.
  • In 2018, content marketing was estimated to cost 62 percent less than traditional marketing tactics while producing three times the number of leads. The impact of affiliate marketing can be ascribed to 16 percent of all internet orders.
  • Amazon’s affiliate structure updated in March 2017, now offering creators rates of 1-10% of product revenue, allowing affiliates to significantly enhance their passive income.
  • The affiliate marketing of Jason Stone, otherwise known as Millionaire Mentor, was responsible for as much as $7 million in retailer sales just in the months of June and July in 2017.

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What Is 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. 

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Why do affiliate marketing?

Here are two reasons why you should consider doing affiliate marketing: 

1. Low-cost and low-risk

Starting a business means incurring upfront costs for products, employees, equipment, rent, and so on. This makes it risky and expensive. With affiliate marketing, all you need is a website. Even if it doesn’t work out, all you’ve wasted is time and a little bit of money.

2. Easy to scale

A typical salesperson only sells products from one company. As an affiliate marketer, you can promote products from many different companies and earn commissions from all of them. 

How Does Affiliate Marketing Work?

Because affiliate marketing distributes product marketing and creation tasks across parties, it is able to tap into the skills of a wide range of people for a more successful marketing approach while also rewarding contributors with a cut of the profits. Three parties must be involved in order for this to work:

  1. Seller and product creators.
  2. The affiliate or advertiser.
  3. The consumer.

Let’s delve into the complex relationship these three parties share to ensure affiliate marketing is a success.

1. Seller and product creators

A vendor, merchant, product maker, or retailer having a product to market is a seller, whether a sole proprietor or a multinational corporation. A physical item, such as household products, or a service, such as cosmetic tutorials, might be the product.

The seller, usually known as the brand, does not have to be actively participating in marketing, but they can be the advertiser and earn from affiliate marketing’s revenue sharing.

The seller could, for example, be an ecommerce merchant who began a dropshipping business and wants to reach a new audience by paying affiliate networks to market their products.

Alternatively, the seller could be a SaaS company that uses affiliates to promote its marketing tools. 

2. The affiliate or publisher.

An affiliate, also known as a publisher, is a person or an organization that promotes a seller’s goods to potential customers in an enticing manner.

To put it another way, the affiliate advertises the product to persuade customers that it is worthwhile or advantageous to them and to persuade them to buy it. If the customer purchases the product, the affiliate receives a percentage of the sale.

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.

3. The consumer

Affiliate marketing is driven by consumers (and their purchases), whether they realize it or not. Affiliates spread the word about these products via social media, blogs, and websites.

The vendor and the affiliate split the revenues when customers buy the product. The affiliate may opt to be transparent with the customer and disclose that they are compensated for the sales they create.

The consumer may be completely unaware of the affiliate marketing infrastructure supporting their transaction at other times.

In either case, they will rarely pay extra for a product acquired through affiliate marketing because the affiliate’s profit share is already factored into the retail price. The customer will finish the purchase process and receive the product as usual, with affiliate marketing having no impact.

How Do Affiliate Marketers Get Paid?

A quick and inexpensive method of making money without the hassle of actually selling a product, affiliate marketing has an undeniable draw for those looking to increase their income online. But how does an affiliate get paid after linking the seller to the consumer?

The answer can get complicated.

The consumer doesn’t always need to buy the product for the affiliate to get a kickback. Depending on the program, the affiliate’s contribution to the seller’s sales will be measured differently.

The affiliate may get paid in various ways:

1. Pay per sale.

This is how affiliate marketing usually works. The merchant pays the affiliate a percentage of the product’s sale price once a customer purchases the product as a consequence of the affiliate’s marketing efforts. To put it another way, before the affiliate is paid, the investor must really invest in the product.

2. Pay per lead.

Pay-per-lead affiliate schemes are a more complicated method that pays the affiliate based on the number of leads converted.

The affiliate must persuade the customer to go to the merchant’s website and take the requested action, such as filling out a contact form, signing up for a product trial, signing up for a newsletter, or downloading software or files.

3. Pay per click.

This program focuses on incentivizing the affiliate to redirect consumers from their marketing platform to the merchant’s website. This means the affiliate must engage the consumer to the extent that they will move from the affiliate’s site to the merchant’s site. The affiliate is paid based on the increase in web traffic.

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  • A dedicated account manager focused on your success.

Why Be an Affiliate Marketer?

What are the reasons to become an affiliate marketer?

1. Passive income.

While any “normal” employment requires you to be present in order to earn money, affiliate marketing allows you to earn money while sleeping.

When you commit a set period of time in a campaign, you’ll see a steady return on that investment when customers buy the product in the days and weeks afterward.

You are paid for your task long after it has been completed. Even if you aren’t in front of a computer, your marketing talents will generate a consistent stream of cash for you.

2. No customer support.

Individual sellers and companies offering products or services have to deal with their consumers and ensure they are satisfied with what they have purchased.

Thanks to the affiliate marketing structure, you’ll never have to be concerned with customer support or customer satisfaction.

The entire job of the affiliate marketer is to link the seller with the consumer. The seller deals with any consumer complaints after you receive your commission from the sale.

3. Work from home.

If you’re someone who hates going to the office, affiliate marketing is the perfect solution. You’ll be able to launch campaigns and receive revenue from the products that sellers create while working from the comfort of your own home. This is a job you can do without ever getting out of your pajamas.

4. Cost-effective.

Most firms require both initial costs and cash flow in order to fund the products they sell. Affiliate marketing, on the other hand, maybe done at a little cost, allowing you to get started quickly and with minimal effort.

There are no fees to worry about with affiliate programs, and no need to manufacture a product. It is relatively simple to get started in this line of business.

5. Convenient and flexible.

Because you’re effectively becoming a freelancer, you’ll have complete autonomy in terms of creating your own goals, rerouting your path as needed, selecting items that interest you, and even setting your own hours.

Because of this flexibility, you can diversify your portfolio or stick to simple and easy ads. You’ll also be free of business rules and regulations, as well as underperforming teams, i.e.,

6. Performance-based rewards

Other jobs allow you to work an 80-hour week and yet make the same amount of money. Affiliate marketing is entirely dependent on your results. You will receive out of it exactly what you put into it.

Improving your review skills and writing interesting marketing will result in immediate income increases. You’ll finally be compensated for your excellent effort!

7. Do Not Underestimate the Power of SEO.

If you do SEO correctly, you can obtain a lot of organic traffic from search engines. The days of Search Engine Optimization (SEO) being all about deceiving Google are long gone. It’s all about making your website more user-friendly today. People are naturally drawn to the internet for information.

To be the first information source people find, you should grasp the fundamentals of on-page SEO, keyword research, and link development. Who wouldn’t want to be number one in Google for terms like “best product” or “product review”?

Final thoughts

No affiliate marketing wheels were reinvented here. These are the fundamentals, and applying them will get you off on the right foot.

Just don’t expect life-changing income or the freedom to quit your 9–5 overnight. Affiliate marketing takes time.

Affiliate marketing is a straightforward way to monetize your content and build an online income. 

As times change, affiliate marketing is evolving. Once blogging and email lists were the main ways to share affiliate links, but social media now means influencers are earning considerable income promoting affiliate products. 

Whichever method you choose, make sure the products you share are relevant to your audience, and steer clear of any shady practices.

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