Valued at $12bn, affiliate marketing offers huge potential for making money online. Both flexible and low risk, this proven business model requires minimal financial outlay, if any, to begin earning commissions. Understanding the basics of affiliate marketing will help set fair and realistic expectations while avoiding rookie mistakes.
What is affiliate marketing?
Affiliate marketing is an advertising model that enables you to earn commissions from promoting another company’s products or services. Commissions are determined as a percentage of the sales you generate, however, occasionally, they may be set at a fixed amount.
How does affiliate marketing work?
The main duty of an affiliate marketer is to direct their audience towards completing a required action, such as making a purchase, visiting a website or registering with a merchant. In order to get results, marketers include links on their social media posts, blogs or website. A tracking cookie within the link helps affiliate networks to identify where the sale has originated from and attribute commissions accordingly.
Types of affiliate marketing
There are essentially three types of affiliate marketing based on the level of association a marketer has with the product or service they are promoting:
Unattached affiliate marketing
This type of marketing requires no direct association between the affiliate or advertised product. Affiliates will earn commission by featuring the merchant’s ads, regardless of whether they fit in with their particular niche or article.
For instance, within a blog article discussing international transactions, there could be adverts promoting tropical fish or washing machines.
Involved affiliate marketing
With involved marketing, affiliates will be seen as experts in the field, educators to their audiences in relation to the product or service, providing recommendations based on personal experience. For example, a champion tennis player promoting the best tennis balls for clay courts.
Related affiliate marketing
Related affiliate marketing is a hybrid of the other two types. Affiliates will usually have a degree of authority within the niche, making them a trusted source of information. For instance, if the marketer has an established audience for casino and sportsbook reviews, they can promote reputable online sports betting sites or information pages, even if they haven’t actually used those particular sites.
Types of payment
There are three primary methods for payment in affiliate marketing, as follows:
- Pay-per-sale: Affiliates receive a percentage of each sale tracked through their unique link
- Pay-per-lead: Based on lead conversion, affiliates successfully convert members of their audience to create an account with the merchant or to subscribe to a magazine for example
- Pay-per-click: Commissions are calculated dependent on the amount of traffic that affiliates can drive to the merchant’s site – the more clicks the better
Is affiliate marketing profitable?
Valued at $12bn, affiliate marketing is a rapidly expanding industry pitching a win-win business model for both the affiliate and merchant. Being prepared to diversify your approach and reach a wider audience is key to being successful in the industry.
Starting an affiliate marketing business is low-risk and low-cost, all you need is a website and away you go. Your earning potential is limitless. There’s no limit to upscaling your business, you can sign up to additional affiliate programs and/or introduce new content and products to your established audience.
Getting started
With all that being said, let’s get down to the nitty gritty and the simple steps for getting started:
Step 1: Decide on a platform
You can potentially conduct affiliate marketing through any platform, even Instagram works! However, it’s easier to build your audience and increase sales through a blog or YouTube channel.
Step 2: Choose your niche
The best advice is to choose a specific element of a category as opposed to something more general. For instance, the subject of ‘animals’ is huge so maybe whittle it down to ‘wild cats’ which is a tighter topic encouraging a more focused audience.
Step 3: Join an affiliate program
With your target audience in mind and a platform to publish on, simply research brands within your niche to find affiliate programs to register with. Keep in mind cookie periods, commission structures and brand reputations.
Step 4: Create superb content
High-quality content earns trust among your audience and boosts your site’s search results. Valuable content must resonate with your target audience. Mix up the kind of content you publish, include product reviews, comparisons, tutorials, resource pages and so on.
Step 5: Drive traffic
With quality content in place, it’s time to drive traffic to your affiliate site. SEO is a must, as the higher up the search engine rankings your content ranks the more traffic you will receive.
Step 6: Get clicks
Finally, encourage visitors to click on your links by paying careful attention to link placement in context within the article. Use eye-catching tables and boxes to attract the reader’s attention and make the post easier to skim read.
