What is Affiliate Marketing & How Does It Work?

Affiliate marketing is a type of performance-based marketing in which you can sign up as an affiliate for a business and promote its products or services to your circle. You’ll get rewarded for each visitor or customer you bring to that brand or for each sale made as a result of your marketing efforts.

Affiliate marketing is often touted as a way to make money while you sleep and there is some truth to that statement. However, like most things in life, it's not quite that simple.

In this blog post, I’ll discuss what affiliate marketing is and how it works in detail. You’ll also learn about:

• The benefits of affiliate marketing
• How to become an affiliate marketer
• The best affiliate networks you should join
• How to start making money as an affiliate marketer

Are you ready to start your journey as an affiliate marketer to create new income sources for yourself and help brands grow while you do so?

Then, let's start…

What is Affiliate Marketing?

Affiliate marketing is a form of marketing in which you, the affiliate marketer, help brands promote their products or services. In turn, you get rewarded for every new visitor, lead, or sale you bring to that brand with your marketing efforts.

Generally speaking, there are three main types of affiliate programs:

• Pay-per-click (PPC): This is where you get paid a certain amount of commission when someone clicks your affiliate link to visit the brand's page.
• Pay per lead: Here, the brand pays you a commission every time one of your visitors fills out a form on their website to learn more about their products or services. A popular example of a brand that uses the pay-per-lead model is Shopify.
• Pay per sale: With this type of affiliate program, you earn a commission every time someone purchases a product or service through your affiliate link.

This payout model works best for brands as they only have to pay an affiliate when they make money from the affiliate’s marketing efforts.

Still unclear about how affiliate marketing works?

Check out the below diagram to understand all steps involved in affiliate marketing.

Image Source

That's the general idea of affiliate marketing and how it works. In the next section, we’ll discuss what makes affiliate marketing worth your time and efforts.

Why Does Affiliate Marketing Matter? Statistics You Should See

Affiliate marketing is a multi-billion dollar industry and affiliate spending is expected to reach $8.2 billion in the U.S. alone by the end of 2022.

This statistic not only shows that brands recognize affiliate marketing as an effective tool to promote their products and services but also means that you have more opportunities to make affiliate income.

There are many advantages of becoming a part of the affiliate marketing industry. Let’s take a look at some of them here:

• Affiliate marketers are paid for performance. So, you don't have to invest in a product or service. You only need to promote someone else’s products or services to earn commission from the sales you generate for that brand.
• Affiliate marketing is a scalable business model that allows you to earn as much money as you want. It’s totally up to you how much time and effort you put into your affiliate business.
• If you check statistics, about 9% of affiliate marketers today make more than $50,000 a year. Some of the most prominent affiliates make millions.
• You can easily diversify your income with multiple affiliate programs to promote products or services offered by different brands. This way, you’ll be able to create multiple streams of passive income as an affiliate marketer, which is a great way to secure your financial future.
• Affiliate marketing is a great way to build relationships with people who are interested in the products or services you're promoting. When you have built a positive relationship with a customer, they're more likely to buy from you again in the future.

You may also like to listen to Everflow’s Michael Cole as he talks about Affiliate Marketing’s Evolution and What the Future Holds on my podcast, Marketing Growth Podcast.

Now that you know some of the benefits of affiliate marketing, let's discuss how to become an affiliate marketer.

How to Become an Affiliate Marketer: The Step-by-Step Process

Affiliate marketing can be quite confusing to newcomers, but once you understand how it works, the process is fairly simple. So let's break down the steps.

Here are the steps you should follow to become an affiliate marketer:

Step 1: Choose the Right Niche for Your Affiliate Business

The first step to becoming an affiliate marketer is to choose a niche market. Your niche determines what you sell and who your target audience is. So, it's crucial that you choose one that you're interested in and passionate about.

For example, if you love doing your makeup to enhance your looks, choosing beauty and cosmetics as your niche is a good idea. You'll be able to easily create content that is interesting and useful to your target audience, and eventually, monetize it.

Let's take a look at a few tips that can help you decide on a profitable niche market for your affiliate marketing work.

• What hobbies do you have? What topics do you like to read about? Consider your interests and passions to look for niches that will make the whole process a bit more enjoyable.For example, if you're interested in fitness, you might choose to promote products related to fitness or health. Similarly, if you're interested in fashion, you might choose to promote clothing and accessories brands that you love.
• Just being interested in a niche doesn’t make it the right market for your affiliate business. You should ask yourself if you will be able to help others solve problems related to that niche.Ask yourself what you’re knowledgeable about and skilled at. For example, if you’re interested in fitness, would you be able to help your audience find out the best workout exercises and diet for their body type.
• What products or services do you use regularly? If the company runs an affiliate program, you can start affiliate marketing by signing up for its program and promoting the company’s products on social media or on your own blog.
• Now that you’ve got a few niches to explore, you should evaluate the monetization potential of different niches. You can visit affiliate networks to determine how much money you can make by promoting different niche products.You can also perform keyword research related to different niches to identify if it’s trending. Also, see how often affiliates use it or check the competitive score of your niche-related keywords using tools like Semrush or Google Keyword Planner.

In all, you should focus all of your affiliate marketing efforts on a niche that you’re interested in and know something about. Plus, this niche should offer ample monetization opportunities so you can become a successful affiliate marketer.

Here are some of the best affiliate marketing niches that you may like to explore:

• Photography
• Travel
• Health, fitness, and weight loss
• Tech gadgets and software solutions
• Gaming
• Home decor
• Beauty and makeup
• Baby products
• Organic and eco-friendly products
• Pet care and pet products (food, accessories, etc.)
• Events and entertainment
• Gardening

Pro tip: When choosing a niche, don’t try to become an expert in everything at once. You should focus on establishing yourself as a specialist in one thing first and then try to learn about other topics related to your niche.

Step 2: Find and Join High-Paying Affiliate Programs

Once you've chosen your niche, the next step is to find affiliate programs that align with your interests. So, how do you go about finding these programs?

One of the best ways to find high-paying affiliate programs is to search online. There are many different directories and databases that list affiliate programs, and most of them are free to join.

Another great way to find affiliate programs is to search online for “affiliate networks” or “affiliate platforms.” These platforms connect affiliate merchants with affiliate marketers. Therefore, joining a popular affiliate network is a great way to find high-paying affiliate programs, as well as quality products and services to promote.

Some of the most popular affiliate networks include:

• Commission Junction (CJ)
• ShareASale
• Rakuten Advertising
• ClickBank
• AvantLink
• Pepperjam
• Awin
• WEBGAINS

Another option is to visit the websites of products and services you use often and see if the brand runs an affiliate program. Most large companies have their own affiliate programs to help boost sales with performance-based marketing.

One such example is Amazon Associates. As a blogger, publisher, or content creator, you can sign up for Amazon’s affiliate program, promote hundreds of products with unique affiliate links, and earn up to 10% commissions from qualified purchases.

The best way to sell Amazon’s affiliate products is to create a blog or use your social media profile to create product reviews and product comparisons.

Image Source

While not all affiliate programs are created equal, you can find programs that offer higher commissions than others by doing a little bit of research.

Whether you search for an affiliate marketing program on Google or other search engines, on forums like Quora, or on affiliate networks like those mentioned above, always be sure that it offers information about three points.

• Contact details – phone number or email address of the company
• Clear instructions on how much commission you will get as an affiliate marketer for every sale someone makes using your code
• Information about what type of promotional methods you can use to promote and sell the company’s products or services

Choose an affiliate marketing program that aligns well with your expertise, skills, and the needs and preferences of your target audience.

Also read: How to Set Up a Profitable Affiliate Program

Step 3: Choose Which Offers/Products to Promote

Once you have a list of high-paying affiliate programs that fit your niche, it's time to decide what type of products or offers will work best for your audience.

There are usually three types of affiliate partnership payment models:

• One-time payments (usually 5%-50% of the sale)
• Recurring monthly payments ($50 each month)
• Lifetime commissions ($500+)

For instance, the popular ecommerce platform, BigCommerce, has a lucrative affiliate program. It lets its affiliates earn 200% of the first-month payment by their referred customer or $1,500 per Enterprise referral.

Image Source

If you run a digital marketing or business growth blog like mine, you may find BigCommerce’s affiliate program worth the effort.

The most important thing when choosing what offer/product to promote is to decide on products and/or services that really sell.

Wondering how to do that? Here are a few tips for you:

• Look for brands that offer lucrative commissions and offers on affiliate sales.
• Don’t overcrowd your affiliate business with slow-moving products.
• Stay on top of the latest trends when choosing affiliate products and services.
• Make sure that the products/services you pick are relevant to your niche. People should actually want what they're being sold. If they don't, then no amount of marketing skills will convince them otherwise. Also, you’ll lose your audience if you push them to buy things they aren’t interested in.
• Sell products from brands you trust in terms of quality, ease of use, effectiveness, and durability. These days, many consumers are valuing sustainable products as well to reduce their carbon footprint.
• Also, consider factors such as market demand, competition, sales cycle length, and other affiliate incentives when choosing the right affiliate programs for yourself.

Step 4: Obtain a Unique Affiliate Link for Each Product/Offer

Once you sign up with an affiliate marketing program, there should be some sort of tracking system in place so that the company knows how many sales were made and by whom. This allows both parties involved; affiliate marketing partners and merchants, to be paid what they deserve.

For instance, in the image below, fashion and lifestyle influencer, and also Hooters’ affiliate partner, Brittany, promoted the brand’s takeout delivery offer with a unique promo code.

Image source

This unique discount code not only encourages users to take any action but also makes it easy for the brand to track how many orders the affiliate generated. Many brands reward affiliates with an additional commission or a higher commission rate if they drive more sales.

When promoting affiliate products, services, or offers, you should always use a unique tracking link or code for each of them to track results.

In the long run, using unique affiliate links or codes will also help you analyze which products or services your audience likes the most. You’ll be able to make better decisions about which brands and products to promote in the future to increase your affiliate revenue.

Step 5: Promote Affiliate Links on Your Blog, Social Media Profiles, and/or Website

One of the best ways to promote affiliate products on your blog or social media is by creating quality content around them.

For example, if you’re promoting a product that helps people save money, you could write a blog post about the best ways to save money. Or, if you’re promoting a product that helps people stay healthy, you could write a blog post about the best healthy foods to eat.

In addition to creating valuable content, you can also promote affiliate products by including links to them in your email newsletters and your posts on Instagram, Facebook, and other social media channels.

When people click on these links, they’ll be taken to the product or service’s website, where they can learn more about it and potentially buy it.

Both website/blog and social media channels have their pros and cons but what matters most is what works best for YOU. If all else fails, go with what feels right at the time. There's no reason why one platform would work better than another if it's not going to provide any benefit whatsoever.

When sharing a link, always be sure to write an enticing description that will make people want to click through. You can also use graphics or videos to help explain what the offer is about. The goal is to help your audience learn more about the product or service and be in a better position to decide if it's something they're interested in.

Most successful affiliate marketing professionals use in-context images and videos for the online promotion of their partner brand’s products or services. It helps the audience connect on a personal level and see how a particular product could improve their lives, which encourages them to buy it.

Here’s an example:

Mike Giese, a competitive cyclist, promoted Honey Stinger products that are easy to carry and help him get the on-trail nutrition he needs to get going.

Image source

While promoting the product, Mike shared a video and a few snaps from his riding time. Plus, he also offered a 15% off affiliate code to give an additional benefit to his audience.

As marketers, we know that people love stories. So, telling your story of using a particular product or service using real-time photos and videos works best to entice users and compel them to buy it.

Other Ways to Promote Affiliate Products

Promotions on Forums

If you don’t run an affiliate website, you can always turn to popular community forums related to your niche to promote the referral links of your affiliate products.

For example, if you want to promote a design course or software solution, you can look for forums where budding artists, designers, and other people talk about design principles, tools and their functioning, and more.

However, you shouldn’t spam forum users with your affiliate links. If you want to drive results from forum promotions, you need to be actively involved in the forum conversations and help other users by answering questions and sharing valuable content.

Paid Advertising

Paid advertising is an easy way to promote your affiliate/referral links to a large pool of internet users at once. You can advertise your affiliate products through Google AdWords, Facebook Ads, or by buying advertising space on someone’s website or blog.

However, investing in paid advertising means that you’ll be spending some part of the affiliate income you generate. So, determine your paid advertising budget, platform, and strategy wisely.

Podcast Advertising

If you host a podcast or participate in a podcast interview, you can use this chance to tell listeners about your affiliate products. However, make sure that the product you speak about is relevant to the topic of the podcast episode.

Video Marketing

Videos are one of the most effective channels to tell stories. You can also create product tutorials and reviews while sharing hands-on experiences of using the product.

And the best part? It’s easy to promote affiliate links in the description or caption of your video posts. If you’ve got a unique affiliate discount code that is easy to spell, you can also mention it verbally in your video.

Step 6: Collect a Commission Every Time Someone Uses Your Link to Make a Purchase

The final step is to wait for someone to use your links and make a purchase. Once this happens, you'll receive a commission from the company.

This is the easiest part of doing affiliate marketing, but your job doesn’t end here.

To be a successful affiliate marketer, you should track how effective each of your affiliate promotions is turning out to be and find ways to make more money.

Step 7: Track and Measure the Effectiveness of Your Affiliate Promotions

You should track the following key metrics to determine the success of your affiliate marketing strategies and system:

• Number of clicks on your affiliate links
• Number of sales actions
• Conversion rate
• Return on ad spend (if you use paid advertising)
• Top affiliate products and programs in terms of sales and marketing efforts

Wondering how to do that?

The easiest way to collect valuable insights about your affiliate campaigns is to use the right tools to do so.

How to Make More Money with Affiliate Marketing: Best Practices

Becoming an affiliate marketer is a straightforward process that doesn't take much time. However, to become successful as an affiliate marketer, you'll need patience and dedication because it takes some time to start making money from your marketing efforts.

For affiliate marketing success, here are a few tips:

• Use different types of affiliate link placement strategies to diversify your marketing efforts and maximize your affiliate sales and revenue.
• Create multiple websites to promote affiliate products of different industries. Don’t promote everything in one place else it will be difficult to attract and entice targeted audience bases.
• Promoting too many affiliate products that provide no real value to your readers or social media followers is a big “NO.”If you want to generate actual sales, it’s important to win the trust of your audience. For this reason, you need to help them discover products and services with real value.

Affiliate Marketing FAQs

1. What does an affiliate marketer do?

An affiliate marketer is a person who promotes other people’s products and services for a commission.

To do this, they create marketing materials such as blog posts, social media posts, and email newsletters, and then drive traffic to the product or service through these channels. When someone buys the product or service through the affiliate’s link, they earn a commission.

There are two main ways that affiliate marketers make money:

• Through commissions on sales: Commissions are earned when an affiliate marketer promotes a product or service and someone buys it as a result of their promotion.
• Through ad revenue: Ad revenue is earned when an affiliate marketer hosts ads on their website.

2. How do I earn with affiliate marketing?

An affiliate marketer is someone who promotes products or services for a commission. They do this by creating content around the products or services they're promoting and then including links to those products or services within that content.

When someone clicks on those links and makes a purchase, the affiliate marketer earns a commission from the sale.

So, how do you become an affiliate marketer? It's actually quite simple. You just need to follow the steps below:

• Choose a niche or category for your affiliate business. You should ensure that you pick something you're interested in and know something about. For example, if you're interested in fitness, you can promote products related to fitness, workouts, or health.
• Find brands in your niche that run affiliate programs using Google Search or by visiting the websites of brands you use and vouch for. You should pick affiliate programs that offer maximum commission amount and other benefits to their affiliates.
• Select the products you want to promote. Make sure that it is something your audience will like to learn about and, eventually, purchase.
• Obtain unique affiliate codes or links to track how many affiliate sales you generate for a brand. Some brands like Daniel Wellington also offer unique discounts for referral/affiliate sales. Promoting such offers can increase your chances of generating sales.
• Promote the affiliate links or codes you receive on your own website or through email newsletters, forums, paid ads, and social media channels. Try your best to make your referral link reach more and more potential customers.
• Collect commission for every sale you generate. Many affiliate programs have a withdrawal limit, which means you can only withdraw your affiliate revenue after hitting a pre-defined sales limit.
• Track key metrics to evaluate the performance of your affiliate marketing efforts. This will help you determine which products your audience resonates the most with and which affiliate programs generate maximum returns.

3. Are affiliate marketers rich?

No, affiliate marketers are not necessarily rich. However, there are many affiliate marketers who make a very good living from their businesses. It's important to remember that affiliate marketing is a business, and like any other business, it requires time and effort to be successful.

4. How much money can you make as an affiliate marketer?

Some affiliate marketers make a few hundred dollars while others earn six-figure incomes from affiliate marketing. It totally depends on how much reach and influence an affiliate marketer has, and the types of affiliate programs they sign up for.

To make more money as an affiliate marketer, you should:

• Choose quality products over high-paying affiliate programs because promoting low-quality products will degrade your reputation and affiliate sales in the long run.
• Consider promoting subscription-based, high-value affiliate products. Many of them offer recurring commissions to the affiliate every time a subscriber renews their product subscription.
• Choose brands with conversion-optimized landing pages and product pages. When a user clicks on your referral link, they’ll be redirected to the landing/product page that gives them more information about the product.
• Users are more likely to purchase through a well-designed and conversion-optimized page than a cluttered, unorganized page.
• Understand your audience, their immediate needs and wants, and the type of products and content they like. This will help you educate them about relevant products and services using value-added content.
• Create a variety of ads and track engagement metrics to see which ones work best for promoting a specific product or service. You may consider boosting your top-performing affiliate promotion posts on social media using paid advertising for greater exposure.
• Use search engine optimization best practices to generate more web traffic to your affiliate website. The greater the number of visitors, the higher your chances of generating affiliate revenue. Here’s a guide to SEO affiliate marketing for more details.

5. How do affiliate marketers make money without a website?

Even marketers without their own affiliate websites can make money by promoting the products and services of their partner brands through social media channels, email newsletters, community forums, and other marketing channels.

Ready to Start Making Money with Affiliate Marketing?

Affiliate marketing is a great way to make money online, but it's important to choose the right offers and programs to promote. By following the steps listed above, you'll be able to find high-paying affiliate programs that fit your niche and start making money in no time!

If you’ve questions about making money online with affiliate marketing, feel free to contact me here.