If you are asking yourself what is affiliate marketing or how you can make money from affiliate marketing, you came to the right place.
You probably heard about affiliate marketing in a podcast or know of a competitor who has increased sales thanks to affiliate marketing, and now you want to try it yourself.
At Kaizen Sigma, we know it can be hard to keep up with every new trend in digital marketing. That’s why we prepared this guide to affiliate marketing for beginners.
In this article, we will explain everything you need to know about affiliate marketing so that you can use it in your own business. Plus, we will give you a couple of recommendations of platforms that can help you get started.
But first things first: what is affiliate marketing?
The answer to the question ‘what is affiliate marketing?’ depends considerably on who you ask. Let’s look at two examples.
According to Entrepreneur.com, affiliate marketing is “a way for a company to sell its products by signing up individuals or companies (“affiliates”) who market the company’s products for a commission”.
Shopify has a slightly different definition: “affiliate marketing is an online sales tactic that lets a product owner increase sales by allowing others targeting the same audience – “affiliates” – to earn a commission by recommending the product to others.”
Ok, so these definitions might be a bit too technical and focus mostly on the seller. Let’s break it down to easier terms: what is affiliate marketing for someone who doesn’t have previous marketing knowledge?
The easiest way to answer the question ‘what is affiliate marketing?’ is the following: affiliate marketing is the online practice of recommending a product, and earning a commission when someone buys that product.
Pretty simple, isn’t it?
Now let’s learn about the three most important terms related to affiliate marketing: the affiliate, the advertiser, and the affiliate network.
The affiliate is the one who recommends the product. As easy as that.
As you may have realized by now, the affiliate must have some sort of online presence to recommend that product. Maybe it’s a website of his own, maybe it’s a YouTube channel. Wherever it is, the affiliate is sharing positive comments and information about a certain product and inviting people to buy it.
But the affiliate is not the one selling the product. He, she or it – an affiliate can be a person or a business – is only recommending the product and adding a link to another website where people can buy it.
The advertiser is the one who sells the product that the affiliate had recommended.
The advertiser is usually a company that sells online, and its products or services are so good that someone – the affiliate – is willing to promote them.
Basically, people follow the affiliate’s recommendation and buy a product from the advertiser. It seems like the advertiser is the only one winning in this situation. How does the affiliate make any money from this?
The affiliate network is the link between the affiliate and the advertiser. Thanks to the affiliate network, the affiliate gets a commission when someone buys a product from the advertiser.
But how do they do it? It’s actually pretty simple.
When someone is visiting the affiliate’s website and clicks on a link to the advertiser’s website, the affiliate network keeps track of that. This way, the affiliate network knows that the purchase of the product was thanks to the affiliate who recommended it. In return, the affiliate network gives the affiliate the corresponding commission.
If this is the first time you’re reading about affiliate marketing, you may be having some doubts about who benefits from it.
First, let’s study the affiliate’s perspective. The affiliate has a website, a social media account or a YouTube channel where they talk about a product they like, and if someone buys that product thanks to their recommendation, they get a commision.
Basically, this means affiliates have absolutely nothing to do with thinking about the product or manufacturing it, and yet they make money from that product. Clearly, affiliates are the ones who benefit from affiliate marketing.
But what does affiliate marketing look like for the advertiser? Sure, they have to pay a commission to the affiliate when they sell a product, but they get great publicity in exchange.
Advertisers get massive amounts of advertisement to their products in hundreds or thousands of pages, and they only have to pay a commission when they complete the sale.
Evidently, the advertiser also benefits from affiliate marketing.
Affiliate marketing is a win-win tactic where both the affiliate and the advertiser benefit whenever someone buys a product.
We answered the question ‘what is affiliate marketing?’, now it’s time to see it in action.
One of the most popular websites to use affiliate marketing is Amazon.com. You can buy pretty much anything from Amazon, and many websites recommend products from Amazon in exchange for a commission.
For this example, we chose an article from Business Insider called The 32 best things we ever bought on Amazon for under $25.
The very first item on their list is ‘a pair of anti-glare, blue-light-blocking computer glasses’. They add a catchy description, so someone might be interested in buying those glasses. If so, they would click on the link below, and be redirected to Amazon.
If you click on that link, you’ll notice it takes you to the following URL:
However, if you search for the same article directly on Amazon, the URL for the product is:
“https://www.amazon.com/gp/product/B00WJUV512/”
Can you notice how the URLs are different? That’s because of affiliate marketing. In the first case, there is a code that tells the advertiser that the purchase is being made thanks to a recommendation made from an affiliate’s website.
Ultimately, if someone buys the glasses because they read the Business Insider article, Business Insider is going to get a commission for that recommendation.
If we haven’t answered all your questions about what is affiliate marketing, we recommend you check out the FREE Affiliate Masterclass.
They are the leaders in affiliate marketing and they can teach you all the secrets about affiliate networks and how advertisers and affiliates can implement affiliate marketing.
We have explained how it works, now it’s time to see how you can make money from affiliate marketing.
There are two parts of the affiliate marketing practice you can choose from: you can either become an affiliate or an advertiser.
If you want to become an affiliate, you need to create an online presence that attracts people and redirects them to a product or service they can purchase.
If you want to become an advertiser, you need to sell your products or services online, and have others promote your business.
Let’s take a closer look at what steps you should take to make money from affiliate marketing in each case.
To make money from affiliate marketing as an affiliate, you need to promote another company’s products and convince people to purchase them so that you can earn a commission.
There are three steps to become a successful affiliate to make money from affiliate marketing.
First, you need to create an online presence that attracts visitors. Most people who try to become affiliates begin reviewing products right away, but they never get enough traffic to actually make a living from it. The most successful affiliates are those who create interesting content that attracts visitors to gain their audience’s trust before actually promoting products.
The second stage is to sign up for an affiliate network. You should contact websites whose products you would like to promote and ask if they work with affiliates. Most are likely to answer positively, so you can sign up for their affiliate network and promote their products.
Finally, once you have a large enough audience and you’re a part of an affiliate network, you can start reviewing products. Make sure your reviews are excellent to convince your visitors to purchase the products.
To make money from affiliate marketing as an advertiser, you need to sell a product and invite affiliates to promote your products.
Similarly to affiliates, there are three steps to become a successful advertiser to make money from affiliate marketing.
The very first step is to create a product you can sell. This means you need to have an original idea for an interesting product and you must deal with production. Try to create something that people will be interested in buying and that affiliates will be interested in promoting.
Next, you have to sell your product online. Create an e-commerce website where visitors can find your products and buy them. Affiliates will send people to your website, so make sure it looks nice and engaging enough for people to purchase from you.
The third step is to find affiliates to promote your products. Joining an affiliate network is the easiest way to find quality affiliates who will make your sales go through the roof.
Now that you know everything you need to know about affiliate marketing, how about actually making some money from it?
We recommend you check out this free case study about affiliate marketing. The video offers great insight into affiliate marketing and shows how it is possible to earn $10,000 in passive income in just 2 months!
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