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Affiliate Marketing And How it Works

What is an affiliate marketing?


We define Affiliate marketing as the process of earning a commission by promoting other people’s (or company’s) products/services. You find a product you like, promote it to others and earn a piece of the profit for each sale that you make.

Webmasters will receive a referral fee or commission from sales when the customer has clicked the affiliate link to get to the merchant’s Web site to perform the desired action, usually make a purchase or fill out a contact form.

Affiliate marketing  has four core players:

  1. Merchant : known as the creator, the seller, the brand, the retailer or the vendor. This is the party that creates the product.
  2. Network (that contains offers for the affiliate  to choose from and also takes care of the payments): letting a network such as ClickBank or Commission Junction handle the payment and product delivery puts a more serious note on your affiliate marketing.
  3. Publisher (also known as ‘the affiliate‘): Affiliates can range from single individuals to entire companies.  An affiliate marketing business can produce a few cash in commissions each month or millions. It’s where the marketing happens. An affiliate promotes one or multiple affiliate products and tries to attract and convince potential customers of the value of the merchant’s product, so that they actually end up buying it.
  4. Customer: The customer makes the affiliate system go round. Without sales, there isn’t any commissions to hand out and no revenue to be shared.

The market has grown in complexity, resulting in the emergence of a secondary tier of players, including affiliate management agencies, super-affiliates and specialized third party vendors.

The affiliate will try to market to the consumer on whatever channel they see fit, whether that’s a social network, digital billboards or through a search engine using content marketing on a blog.

What is the aim for affiliate marketing?

Once you find a product you like, just promote it to others, and earn a piece of the profit for each sale that you were able to make. This in turn benefits all in areas like:

  • You (affiliate)’re happy because you earned a commission,
  • The company(merchant) is happy because they have a new sale from a customer that they might not have normally been able to reach,
  • And the customer is happy because they learned about a product from you that will hopefully fulfill a need or desire.

NB ”The beauty of affiliate marketing is that you don’t have to invest the time and effort to create a product to sell. You can begin selling something as an affiliate as soon as you have a platform to sell it on. You also need no degree or certificate to be an affiliate marketer.”

How Do You Get Payments?

Most merchants will only pay for the actual leads and not just visits. This makes it more of an advantage compared to Pay Per Click where a ton of money is spent without producing any actual leads. So it is best to send leads that could generate sales so you get the right payment. Not all leads are converted into sales.

Now not all people are aware of what PPC, PPL and PPS is. Here’s what you need to know:

  • Pay Per Click or PPC – is a program where an affiliate gets paid for all the valid clicks generated regardless if it made sales or leads.
  • Pay Per Lead or PPL – is a program where advertisers pay a fixed commission for every qualified action that it generated. This action could be Installation, Online Form Submission, Free Trial, Short Survey and many others.
  • Pay Per Sale or PPS – is a program where advertisers pay the publisher a percentage of all sales that are qualified. These could be a percentage which was agreed by the advertiser and publisher.

Here’s a way to start affiliate marketing:

  1. Research different affiliate programs and products.
  2. You find a product you want to promote.
  3. You sign up for their affiliate program
  4. You get a special link that allows the merchant to track the people who clicked your link
  5. Build a site or channel.
  6. Produce excellent content.
  7. Build an audience.
  8. Promote your affiliate product(s).
  9. If they buy the product, you get a commission

There is not limit actually to how much you can earn from affiliate marketing. However the amount you earn will depend on the program you are promoting and as to how many conversions you are generating.

Please read understanding emotional intelligence

Final Thought:

Although you are not the merchant of the products you promote, you should be knowledgeable enough about them.

This is because, they do reflect on your judgment as a marketer, because people who buy through your links may remember you and your recommendations.

I get questions from some folks about how to make money online. How to use some of their vast time online to generate income. One of the modes of making online money is through affiliate marketing. From above, you must have learnt certain basic ways this can be done.

I try to simplify it so that you need not worry about certain terminologies but how you can go about this. These are the few reasons why affiliate marketing is so popular and why it’s one of my favorite ways to make money online.

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