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What Is Affiliate Marketing?
Simply put, affiliate marketing is a way that an affiliate can earn commissions by promoting the products and services of an online merchant. The affiliate (you), also known as the publisher, uses their web properties to refer traffic to the website of an online merchant, also known as an advertiser.
An affiliate is a publisher of information in the form of articles, blogs, podcasting, video, audio, or more. These publishers monetize their content with affiliate programs.
Within this relationship an affiliate is rewarded when someone follows a link on their blog or website to the website of a merchant and then makes a purchase. Depending on the merchant, commissions are most often based on a percentage of a sale or a fixed amount per conversion.
The popularity of Affiliate Marketing has grown exponentially over the last decade, simply because it is so successful:
- Merchants often chose affiliate marketing as a channel to promote their products because they only need to pay for advertising that produce conversions or sales.
- Publishers often choose affiliate marketing because it provides an opportunity to supplement or even replace their income while working from the comfort of their own home. There is no requirement to stock product and all shipping or digital delivery is taken care of by the merchant.
Affiliate marketing is not risk free however, and although there are many success stories there are just as many, if not more, failures. You must be disciplined, prepared to roll up your sleeves and put in the hours. If not you will just end up hopping from one affiliate offer to another wasting time and money looking for the easy riches.
- There are NO guarantees.
- If necessary, you must be prepared to work longer hours than you have ever worked before.
- You must be willing to accept the risks that come with running your own business.
Nuts And Bolts Of Affiliate Marketing
The merchant will often provide marketing materials known as ‘creative’ to help affiliates on their way. Creative is added to your website and comes in the form of:
- Banner ads
- Text links
You will also receive an affiliate tracking code that allows you to track your referrals to the merchants site, sales, conversion rate and any commission due to you. Commissions are typically paid out on a monthly basis by check, Electronic Funds Transfer (EFT) or PayPal.
Affiliate networks provide the glue that binds the affiliate and the merchant together. They provide affiliates with up to date reporting of sales and commissions as well as historical data useful in measuring and tracking the effectiveness of their marketing efforts. Similarly, affiliate networks provide advertisers with valuable information about sales volumes and the ability to monitor the success of their advertising.
5 Of The Best Affiliate Marketing Networks
1. Commission Junction (www.cj.com): Based in Santa Barbara, California and now owned by ValueClick, Commission Junction is a global leader in affiliate marketing. Merchants include top brands and dedicated support is provided for top-performing publishers.
2. LinkShare (www.linkshare.com): LinkShare was founded in 1996 making it one of the oldest affiliate networks on the web. is another excellent affiliate network. LinkShare are based in New York City, with offices throughout the US as well as London and Tokyo. Merchants include J.C. Penney, 1-800-Flowers.com, American Express, and Avon Products. It is one of the oldest affiliate networks on the web. LinkShare was acquired by the Japanese Portal Rakuten in 2005 for the princely sum of $425 million.
3. Affiliate Window (www.affiliatewindow.com): Affiliate Window is the UK’s largest affiliate marketing network. Merchants include blue-chip brands such as Dixons, Boots and Vodafone, to niche retailers looking to grow their online presence. Excellent stats, and good commission rates paid out on a monthly basis.
4. Amazon (www.amazon.com): Launched in 1996 Amazon is another excellent affiliate marketing network with thousands of products to choose from. Amazon provides excellent stats and reporting. Conversion rates are amongst the best in the industry and affiliate links are very easy to place on your website or blog.
5. Shareasale (www.shareasale.com): Shareasale, located in Chicago Illinois, is a privately held Corporation established in April 2000. There are currently over 2,500 Merchants in to the ShareASale Affiliate Marketing Network providing a diverse range of products.
How Do Affiliates Get Paid?
Depending on the merchant or network you are working with you can be paid per sale, per lead, or per click.
- Pay Per Sale is the most popular payment within the affiliate marketing industry. Commissions are earned when a visitor to your site clicks through to the merchant’s site and makes a purchase.
- Pay Per Lead is often the preferred payment model amongst finance, mortgage and insurance providers. Payment is made when you refer a visitor to an advertisers site who completes a form and gives their permission to be contacted for further information.
- Pay Per Click differs from Pay Per Sale and Pay Per Lead, here you are paid for the click regardless of whether the advertiser makes a sale or not.
4 Questions to Ask Before Joining Any Affiliate Program
- Dose the merchants site look professional? Make sure the affiliate program you are joining maintains a professional site that’s easy to navigate and contains good sales copy. There is little point spending time, money and effort generating traffic to a site that simply fails visitor expectations. Don’t send custom to a site you wouldn’t feel comfortable buying from yourself.
- Does the merchants products or services fall within in your area of expertise? Promoting a product that you are you are knowledgeable about is probably the best way to get started in affiliate marketing. A quick way to find suitable affiliate programs is to search on Google for a product or service followed with the words ‘affiliate program’.
- Are there negative online reviews regarding the merchant or their products/services? Prior to making a purchase online many people use search engines to research the credentials of the retailer and appraise consumer reviews of the product or service. If the results are flooded with negative reviews and warnings from dissatisfied customers, it will limit any possible success. Conversely, good reviews will work for you.
- Are you prepared to put in the extra hours? Affiliate marketing is no different to any other type of business. The level of success you enjoy is commensurate to the hours you put in and how effective that time is spent. Affiliate marketing offers a means to earn a substantial income if you remain dedicated and diligent. However, affiliate marketing also a killing field for the niave and capricious. If you are looking for some kind of ‘get rich quick scheme’ that runs on auto-pilot, affiliate marketing is definitely not for you.
Part two of this series of articles will look at possible earnings and how to select a product to advertise.