What’s Affiliate Marketing and How Does It Work

Let’s Define Affiliate Marketing


Neil Patel breaks this down very simply by saying “Affiliate marketing is the process of earning a commission by promoting other people’s (or company’s) products. You find a product you like, promote it to others and earn a piece of the profit for each sale that you make.”

What the above basically means is that affiliate marketing is an agreement between an online retailer and an online marketer. They would agree that for every person that buys a product/service through the “marketer’s link” (which is explained later on in the post), the marketer would receive a certain percentage of commission for the sale.


The Game


In affiliate marketing, there are basically two players on a team trying to score a goal

The players:

The merchant- This could be a company selling a product/service e.g.: Wealthy Affiliate , or an individual that is trying to sell their product/ service (usually, individuals sell training courses online)

The Marketer/ Affiliate – this is usually an individual / company that promotes the merchant’s products on their website and social media

The goal: to get consumers to buy the product/service.

The game plan: the merchant gives the product/service link to the marketer who then uses their website and social media to leverage web traffic , promote the product/service and ultimately score a goal.

Pretty simple in theory right?

We all know that in reality…almost nothing is as easy as it may seem. That’s why from the onset, I am going to make it clear to my dear friend that affiliate marketing is NOT a get-rich-quick scheme.

It a proven method to build a sustainable business online.

This means that instead of earning a couple a hundred dollars online in a small space of time and then closing shop, you will be building a business that will one day be potentially making you a couple of hundred (or even thousands) of dollars daily, but this requires time and effort.

This doesn’t mean that you need to be building and improving your website 24/7, but the more time and effort you put in, the likelier your chances of success are.


The link…


What is an affiliate link? An affiliate link is basically link that the merchant gives you upon signing up for the affiliate programme.

You then copy that link and insert in strategic locations within your content. When a customer clicks on your link, it will take them to the merchant’s page where the merchant will then further try to sell the product.

The genius thing about the affiliate link is that when the customer clicks your link and buys the product, the method they took to buy the product is traced and the link is tracked back to you. Thus allowing you to receive payment for the sale.

However, the question now arises, “what happens if the customer doesn’t buy straight away, leaves the merchant’s site and returns later to buy, but goes directly to the merchant’s site and bypasses my site, how do I still get paid?” When a customer clicks your link, something called a “cookie” is placed on their browser and this will track their use of that particular website for a certain number of days (the numbers vary between different companies)

So if your potential customer returns within the stipulated number of days and purchases, you will still be compensated for the sale


The Possibilities of Your Earnings…


Depending on what you are promoting, you can earn anywhere from 1-100% commission for selling a product (note that 100% commission is extremely rare)

The most common range though is from 4-75% commissions.

The sale of physical products usually yields a lower commission, e.g.: Amazon pays their affiliates between 1-10 % commissions per sale.(although in April 2020 ,Amazon cut their commissions  by about 50%,so just be careful when signing up with them.)

The sale of digital products/services (like online courses etc.) usually pay larger commissions, between 50-75 % commission per sale.


How Do You Get Paid?


Depending on the agreement between the merchant and the affiliate, the affiliate’s contribution to the merchant’s sales will be measured differently. Two common ways of getting paid are:

  1. Pay per sale: this is the standard method of getting paid. When a customer actually buys the product/service through your link, you will receive a commission of the sale.
  2. Pay per click: this is simple; you will get paid every time a customer clicks the link that will take them to the merchant’s website. Basically, you are not getting paid for only making the sale, you are now getting paid for driving traffic to the merchant’s website.

The Tools You Will Require…


The best thing to have as an affiliate marketer is a website that will sell your product for you.

Other lucrative ways to promote the given product/service is on social networks like Facebook, Instagram, twitter, Pinterest etc. However, the challenge with social media is that you are going to require a large following to be able to make an impact on your sales

Another form of advertising is paid ads, but this is not recommended when you are starting off. The best thing to achieve when starting out is organic web traffic as this helps with your Search Engine Optimization.

(Organic traffic Is basically the visitors you attract to your website via unpaid search results. This means that visitors find your website on their via search engines like Google, Bing or Yahoo, and they are not “referred” by another website

Search Engine Optimization is the process of getting ranked on Google or other search engines via organic traffic. This is very important as the higher you are ranked on search engines, meaning the closer you are to the first page that appears when someone searches for your product, the more traffic you will get to your website and ultimately the more sales you will make)


Sell While Sleeping


The reason why I said that a website is the best thing to have as affiliate marketer is because if you think about it, your website is your 24/7 sales representative.

Once you write your content about a particular product/service and publish it, it remains on your website and people can access your content and buy through your link at any time of the day or night (this is actually one of the main reasons that Affiliate Marketing becomes a form of passive residual income)

If you promote products/services on your website, you can write detailed lengthy blogs to convince people to buy the product/service. The reason this is important is that before people buy a certain product, they usually search for reviews on that product and whether it is useful or a waste of money and time.

This indicates that those people are usually open-minded about the product and by providing a detailed description and review of the product/service, you are able to persuade the reader to be inclined to buy the product

The problem that many starting affiliates face though is how to actually create and start a website as this seems like a daunting task. The truth is that it actually isn’t and you can learn how to build and set up your website in 4 simple steps right Here!


The Best Methods of Promoting Products While Adding Value


Some best proven ways to promote a product/service is by writing:

  • review posts
  • how to posts (and then incorporating your product as a key aspect of doing the action, e.g.: if my product was a baking machine, I can write a how to post that’s titled “how make a cake” and then show people how to make the cake but incorporate the baking machine in my method. Then at strategic points in my content I will add my affiliate link)

Note: To promote a product is the one of your main goals as an affiliate marketer.

The other main goal is to genuinely add value to the reader’s life.

You need to be honest, open and persuasive in order to gain the reader’s trust and hence, making the sale, so if you don’t like an aspect of the product, let the reader know because this shows them that you are not just saying good things about a product to promote it, but you are actually giving your honest opinion which is much more valuable and leads to gaining their trust.


Pros and Cons of Affiliate Marketing


Pros:

  • It is one of the cheapest ways to start making money online
  • There is no face to face or phone call selling, your website does the converting for you
  • Affiliate programmes are almost always free to join.
  • As you gain trust and authority within your niche (field of interest) , you should gain more web traffic start and to convert more often, leading to more revenue being generated.

Cons:

  • It takes time to start earning decent money
  • Again, getting organic traffic takes time (you could potentially go months on end without seeing any major results)
  • Link tracking does sometimes fail and therefore resulting in the loss of a sale

Conclusion + my special bonus


If you are serious about building a solid financial future for yourself then I would recommend affiliate marketing for you, because through affiliate marketing, you can build your own business at your own pace.

For those who are looking to make quick money online, affiliate marking is not something I would recommend because as I’ve mentioned above, in the affiliate marketing industry, it takes time to make a dime.

For those who are interested in affiliate marketing, I am going to offer you the same package I was offered when first started. That is a 7-day FREE trial at Wealthy Affiliate (arguably the industry’s most advanced affiliate marketing platform) where you will gain access to the first phase of 2 Step-by-strep courses that will help you to build and grow your website over time.

All you have to do is click here and set up your account for free. That’s it ! Welcome to our world…

If you have any questions or queries, you can simply scroll down, type your comment/question in the text box and I will get back to you ASAP.

Yahya

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8 Replies to “What’s Affiliate Marketing and How Does It Work”

  1. Great post. Very informative but easy to read. Affiliate marketing is certainly the way forward to legitimately earn money. But as you mention it does take time.

    1. Thanks Ibrahim. The idea behind this post was to inform people of what affiliate marketing really is and help them make a conscious decision about their future.

  2. Great content there you broke it down well into bite size chunks that are easy to understand and I like the way you kicked off the I will make a fortune in a week readers.
    People need perspective and your post did it well. Cheers

  3. Hey, Ibrahim.
    thanks for sharing this article, really long and complete. I am glad your website provides the information I need.

    To be honest, I like blogging. Right now, I’m still learning and still need to read a lot of literature to improve my content. It is quite difficult for me who only rely on GLanguange as a helper, to understand many things that I need to achieve my goals. Anyway, thanks again for this article 🙂

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