What is Affiliate marketing and How does it work?

Everyone wants to get out of the rat race and gain financial freedom. When you go online, you come across internet marketers especially on YouTube teaching you various techniques to make money while you sleep

Passive income is the dream.

And yes, It is possible!

One of the foremost ways to earn it online is through affiliate marketing.

What is Affiliate marketing?

Affiliate marketing is a referral based marketing system that involves the recommendation of products by a marketer in exchange for commissions from the sales of such products.

In other words, you can make money by promoting other people's products

How Affiliate Marketing Works

A marketer finds a product he likes, promotes it and earns a commission (a share of profit) from the sale of such product.

According to acceleration partners,

1. Affiliate partner promotes a brand’s products or services on their site.
2. Consumer clicks on brand’s promotion on the affiliate’s site and a cookie is then stored on the consumer’s browser; cookies are what make it possible for the affiliate network to track the consumer’s progress from the affiliate’s website through to the brand’s shopping cart.
3. Consumer is redirected to brand’s website.
4. Consumer purchases a product/service from the brand.
5. The network then automatically pays out a commission to the affiliate (based on the rules set by the brand) for driving that sale.

There are basically four parties involved in a typical affiliate marketing system
They include:

1. The Merchant
2. The Affiliate Network
3. The Publisher or Affiliate Marketer
4. The Consumer

The Merchant:

This refers to the product creator. They don't necessarily have to be the manufacturer of the product. The merchant only needs to have a product to sell

The Merchant could be a manufacturer, retailer, vendor or brand. For Example, Jumia is a merchant and of course, they obviously don't manufacture products. Yet, they have enough products for affiliates to promote

Moreover, The merchant doesn't have to be a big brand like Jumia or Amazon. Even Solo entrepreneurs who produce e-books and other digital products can fall into the merchant category. All that is required to be a merchant is have something to sell

Affiliate Networks:

These are middlemen that serve as intermediaries between affiliate marketers and the merchants
Although some merchants create and handle affiliate programs themselves, it is much easier to leave all that for affiliate networks to handle

Affiliate Networks Usually have a lot of products among which a marketer or publisher can choose to promote. This way, a publisher isn't limited to just one product. Examples of really nice affiliate networks include ShareAsale, ClickBank, Commission Junction etc

Publisher Or Marketer:

Affiliate marketers are promoters who attract customers through various means and convince them to make a purchase decision or take specific actions on a merchant's website.

When an affiliate marketer tactically gives a consume, good reasons as to how a particular product solves problems and add values, conversion is expected.

Most bloggers, Influencers and brands fall into this category

Consumer

The audience that an affiliate marketer look to influence to make a purchase, submit a lead form, sign up for a newsletter, test out a service, become a new customer, etc.

Consumers are usually the main target for an affiliate marketing cycle to be complete. And of course, it has to end with a purchase

How Do Affiliate Marketers Get Paid?

There are different ways and payment options for affiliates. they include:

PPC (Pay Per Click)

You make money based on the number of users you send to the advertisers website through your link

(PPL) Pay Per Lead

You get a commission when a user follows your link to an advertiser’s website and completes a particular action which could be filling a form, signing up for a trial of a product, subscribing to a newsletter, downloading a software, or submitting contact details.

(PPS) Pay Per Sale

This is the most commonly used payment structure. You’ll get your commission from a merchant when a user makes a purchases as a result of your marketing strategies

Advantages of Affiliate Marketing

You can work from Home

For those who hate going to the office, affiliate marketing allows you the pleasure of working from home. All you need is your computer and internet connect. This is a job you can do without ever getting out of your pajamas.

You earn passive income

While any “regular” job requires you to be at work to make money, affiliate marketing offers you the ability to make money while you sleep. By investing an initial amount of time into a campaign, you will see continuous returns on that time as consumers purchase the product over the following days and weeks. You receive money for your work long after you’ve finished it. Even when you’re not in front of your computer, your marketing skills will be earning you a steady flow of income.

It is Cost-effective

Unlike most businesses that require huge amount of startup fees, affiliate marketing can be started at low cost, meaning you can get started quickly and without much hassle. There are no affiliate program fees to worry about and no need to create a product.

Conclusion

Affiliate marketing is perfect for those looking to gain control of their own income by focusing on performance-based revenue options. An affiliate marketer can also achieve passive income without worrying about producing their own product or service.

Although the success of your business depends on your skills, affiliate marketing is an effective way to make money online full-time or part-time.

What are you waiting for?

Learn How to start affiliate marketing