Affiliate marketing is promoting other people’s products in return for a small commission for each sale. You’ve probably seen headings marked “affiliate link” or “sponsored post” on many of the websites you visit; or maybe you’ve already taken the first step and signed up to an affiliate network.
If you are new to affiliate marketing, let’s cover how it works.
First, find an affiliate program or network you are interested in. Look at the program overview, including the type of products or services, payment methods, and commissions they offer.
If it appeals to you, sign up and wait for confirmation of your acceptance. Then, start creating content, adding the custom links the program provides. Those links track when one of your users makes a purchase, and you’ll earn a small commission.
You can work with individual companies or affiliate networks, where you register and choose the programs that interest you. The programs are generally divided into categories to make selection easier. Once approved, start promoting your affiliate links on your website, in newsletters, on social media, and anywhere else you’re permitted to share links.
The network sends you a payment when you’ve reached the minimum payment level. Payment methods vary, and usually include PayPal, bank transfers, and checks.
Let’s take a more in-depth look at the parts of a successful affiliate marketing system.
The Merchant
Sometimes also known as the creator, the seller, the brand, the retailer, or the vendor. This is the party that creates the product. It can be a big company, like Dyson, who produces vacuum cleaners.
Or, it can be a single individual like Mariah Coz, who sells online courses to female entrepreneurs.
From solo entrepreneurs to startups to massive Fortune 500 companies, anyone could be the merchant behind an affiliate marketing program. They don’t even have to be actively involved. They just have to have a product to sell.
The Affiliate Marketers
This party is sometimes also known as the publisher. Affiliates can also range from single individuals to entire companies. An affiliate marketing business can produce a few hundred dollars in commissions each month or tens of millions of dollars.
It’s where the marketing happens. An affiliate promotes one or multiple affiliate products and tries to attract and convince potential customers of the value of the merchant’s product so that they end up buying it.
This can be achieved by running a review blog of the merchant’s products. For example:
It could also be an entire site dedicated to finding cool products related to certain topic and promoting those affiliate products.
(This is why I’m broke is one of the most popular affiliate network sites)
The Consumer
The customer or consumer makes the affiliate system go ’round. Without sales, there aren’t any commissions to hand out and no revenue to be shared.
The affiliate will try to market to the consumer on whatever channel they see fit, whether that’s a social network, digital billboards or through a search engine using content marketing on a blog.
The consumer needs to knows they are part of an affiliate marketing system. Usually a short disclaimer like “If you purchase items on this site, I may earn a small commission. Thanks for supporting our work.” is fine.
The consumer will not typically pay a higher price to the affiliate marketer, as the cost of the affiliate network is already included in the retail price.
The Affiliate Network
Only some consider the network part of the affiliate marketing equation. However, I believe that an affiliate marketing guide needs to include networks, because, in many cases, a network works as an intermediary between the affiliate and the merchant.
While you could technically promote someone else’s course and arrange a direct revenue share with them, letting a network such as ClickBank or Commission Junction handle the payment and product delivery puts a more serious note on your affiliate marketing.
Sometimes, affiliates have to go through an affiliate network to even be able to promote the product. For example, this happens if the merchant only manages their affiliate program on that network.
The affiliate network then also serves as a database of lots of products, out of which the affiliate marketer can choose which to promote.
Clickbank is an example of an affiliate network.
In the case of promoting consumer products, like tools, books, toys and household items, the biggest affiliate network, by far, is Amazon.
Their Amazon Associates affiliate program lets you promote any item that is sold on their platform.
Anyone can sign up and then generate a custom affiliate link to Amazon products. If someone purchases through your link, you earn a small commission.
With the basic terms clarified, let’s get an overview of how you can best get started with building your affiliate marketing business.
As I said, there are basically two sides of the affiliate marketing equation to choose from, assuming you are not going to build an affiliate network like Commission Junction.
You can become a merchant and have others promote your product, in exchange for giving them a commission from the sales that they make.
Or, you can become an affiliate marketer for several products and market those to consumers, in order to make money.
While most people start by taking the affiliate route and it definitely is the easier path to take, building enough traffic to make a meaningful income just from affiliate sales isn’t quick or easy.
That’s why I’ll walk you through the four basic steps to get started on both sides of the affiliate marketing industry.