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How Does Affiliate Marketing Work Online?

Updated on July 18, 2011

What Is Affiliate Marketing?

Many people wonder what is affiliate marketing? There really is no concrete affiliate marketing definition. Affiliate marketing allows you to make money online by earning commissions on internet sales of products from other companies. It is one of many internet money making ideas, and one of the best ways to make money from home.

It's one of the best ways to make money online because there is little to no risk, and it takes very little money to start. You can even start affiliate marketing with no money at all!

You can choose virtually anything you want to promote with affiliate marketing. So anything that you already have an interest in or knowledge of already works. Books, sports, beauty supplies, jewelry, and software are just a few examples.

Physical products aren't the only thing that allows you to make money with affiliate marketing. You can sell digital products, services or collect finder's fees as well.

The commissions you collect are usually a percentage. They can range as low as 6% up to 75% of the purchase price.

Reasons to Start Affiliate Marketing as a Way to Make Money Online

Affiliate marketing is a great way for someone new at making money on the Internet to learn the ropes.  It is easier than most other online moneymaking methods because it's easier to understand than other ways.  It's easier to relate to affiliate marketing because it works like a salesperson who makes commission in the normal business world.

Another great thing about affiliate marketing is that there is no inventory.  You save money by not having to buy your inventory or pay for storage space.  You save time by not having to pack and ship packages.  And you save headaches by not dealing directly with customers and complaints.  The owner of the products handles any customer service issues.  You don't even have to set up a payment processing method or a merchant account for payment.

Yet another reason to start affiliate marketing is that every year the number of people who buy items online keeps growing.  Why not get a piece of that gigantic retail pie for yourself?

How Does Affiliate Marketing Work?

You want to know how does affiliate marketing work? The simple way affiliate marketing works is that you set up a web site promoting particular products.  Basically you advertise the products, hence the term affiliate marketing.

You put special links on your website that are coded with your unique affiliate ID.  You try to get people to click on your links.  If they do, they will be sent to the company website.  If your website visitor buys the product, you get your commission.

There are many ways to set up websites for free.  There are even ways to make money with affiliate marketing without owning a website!

Yes, You Can Work at Home and Make Money Online With Affiliate Marketing

This isn't to say that affiliate marketing is an easy way to make lots of money overnight.  If you want to be successful in affiliate marketing, you have to work hard.  You also need patience, the ability to continue to learn all the time, diligence, and time.

But if you don't give up and keep learning affiliate marketing, you can be successful and work at home!  Yes, you can even make money in your sleep with affiliate marketing just like all the ads claim.  You can also make thousands of dollars a month with affiliate marketing if you do your research and learn how to do it correctly.

How Does Affiliate Marketing Work Online? Comments

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    • twilanelson profile image

      Twila Nelson 6 years ago from Carmichael, California

      Thorough and correct hub. I am working online through the nights and going door to door during the day. I am trying to learn how to boost my sites popularity and rankings. I feel like a failure from time to time. Although you have brightened my day. I will learn as much as I can and implement that information with hard work. I will use patience and keep waiting for some monetary monetary reward. Thank you for reminding me to stay optimistic.

    • katiem2 profile image

      katiem2 7 years ago from I'm outta here

      This is a great hub and very well done I feel it's easy to follow and really gets the point accross without holding anything back. FAB HUB Peace :)

    • Hello, hello, profile image

      Hello, hello, 7 years ago from London, UK

      A very complete and information hub. Thank for giving all these details and help.

    • martycraigs profile image

      martycraigs 7 years ago

      A great explanation of affiliate marketing. People who have the time and resources to invest can become quite successful. But it surely isn't for everyone.