Affiliate Marketing: What it is and How it Works

Affiliate marketing is a type of business where someone (the affiliate) promotes a product or service and receives a commission for doing so.

It is a wonderful business relationship where an individual or company, large or small, agrees to pay you money based on a certain action that people you send to him take.

Typically, people become affiliates by signing up with a network marketing company, or by working with an affiliate management company. Once an affiliate signs up with a network marketing company, they will be given access to a database of products and services. The affiliate is then responsible for promoting the products and services to its audience. 

white printing paper with Marketing Strategy text

When someone signs up as an affiliate, they are essentially becoming a salesperson for the network marketing company. The primary goal of an affiliate is to generate as much revenue as possible for the network marketing company. In order to do this, the affiliate must adhere to certain guidelines and rules set by the network marketing company.

There are several ways that affiliates can generate revenue from their work as an affiliate.

Let me give some examples:

Amazon.com has one of the biggest and longest-running affiliate programs.  They will pay you a commission based on what people buy when they come in through your links.  So, let’s say you make a website to promote a product. You get traffic to your website and send it to Amazon using your affiliate links.  Let’s say these people buy something.  You will make a commission on anything they buy that falls within Amazon’s rules.

Amazon’s commissions are low compared to many other affiliate programs, but some affiliates have found that the ease of selling physical goods at amazon (versus selling digital goods somewhere less well-known) makes up for the low commission rates.

As an example of a less well-known place to sell digital goods, we can talk about the website clickbank.com, where people can sell things like digital e-books. The ClickBank marketplace is where an e-book is sold and promoted by its author or creator. A “vendor” on Clickbank is an individual or business that sells goods or services. Some sellers charge commissions of up to 75%, but this varies widely depending on the product.

75% is a lot for an e-book that costs £35 or £87. Despite the higher payout, conversion rates (the percentage of visitors who actually make a purchase after clicking your link) can be low. Affiliate marketing isn’t limited to selling Amazon products or Kindle books; there are plenty of other opportunities out there. You can find an affiliate program for just about anything you can think of.

Promoting cost-per-action (CPA) offers is another way to earn money as an affiliate marketer. Cost-per-acquisition or CPA for short. Form filling, application submission, email address disclosure, and offer registration are all examples of common trigger actions. To put it simply, if you can drive enough traffic to the offer and have them complete it, you will earn a specified sum of money.

This sum of money is typically small, ranging from a dollar to two dollars, but it can be significantly larger for some offers. If you sign up for a medical offer where you only pay shipping and handling, but then don’t cancel or return the item, your credit card will be charged the full price of the item. These deals typically pay much more than those requiring only an email address. However, the rate of return and refund for such offers may also be higher.

Many people also use Google AdSense as a form of affiliate marketing. Utilizing AdSense from Google. AdSense is an option to consider if you build a high-traffic website but are at a loss as to what kind of advertisements or affiliate links would be most effective. You create an AdSense account and AdSense provides you with some code. If you copy and paste this code onto your site, AdSense will begin displaying advertisements in that location.

AdSense works by analysing the text on your page to determine its topic and then displaying contextual ads based on that information. Profits are generated from ad clicks. There are more important subjects to discuss. Some things, like experiences, are more valuable than others, like a collection of recipes.

Although it is less common, there is one more kind of affiliate program that I’d like to describe. It’s a “pay-per-click” model. Say you have a website and you put a link on it to a vendor who offers to pay you a certain amount of money for each click through the link. There is a wide range of costs per click, from a penny to £.15 or £.20 for sellers.

I’m hoping this has shed some light on the concept and practice of affiliate marketing. It’s not really free cash, but it can feel that way at times. There is no product to ship, no customers to support, and you still get paid.

Franklyn Frantos (Snr)

© 2022

Leave a Reply

Your email address will not be published. Required fields are marked *