What Is Affiliate Marketing?
If you’ve ever heard about affiliate marketing before, you’ve probably heard how it makes it so easy to make money – anytime, anywhere, without having to do anything. Most people talk about its end result, but very few take the time to explain how affiliate marketing works.
But that’s just what makes more people curious to learn about it. After all, who wouldn’t want to quit the rat race of corporate life and find an alternate stream of income that brings you money even while you sleep (literally)?
So, what is affiliate marketing? Let’s find out.
Affiliate Marketing: The Definition
Simply put, affiliate marketing is a process involving earning commissions by promoting the offerings of other retailers or advertisers, be that products or services.
But it’s not just about “promoting” the products or services. For this monetization model to work, you’re only rewarded the commission when the retailer or advertiser achieves a specific result through your promotion. In other words, it’s performance-based.
In most cases, that result is a conversion, usually in the form of a sale. Yet, that’s not to say that other conversions are also possible, including leads, website clicks, newsletter subscriptions, app downloads, free trial users, and more.
When you join an affiliate program, in which an online merchant (the affiliate) offers to pay individuals a commission in exchange for promoting their site, product, or service, you’re then called an affiliate partner.
Note: You can promote the products and services of multiple companies and earn commissions from all of them – there’s no conflict of interest, which further makes affiliate marketing appealing!
How Affiliate Marketing Works
To go into further detail, affiliate marketing entails promoting a product, service, or even website through a distribution channel that you own. The most common channels include blogs, social media accounts on different platforms, podcasts, and websites.
You’re probably thinking about how the affiliate knows that they earned a customer through you. It’s pretty simple: they provide you with a unique affiliate link associated with your partnership, and that’s the link you use to refer readers, visitors, viewers, or listeners, to the given product or service.
That way, whenever someone clicks on those links and makes a purchase or performs the desired action that the retailer or advertiser desires, your commission is automatically recorded and traced back to you. Once the transaction is credited, you get paid your commission as a token of appreciation for your efforts.
While affiliate marketing programs’ commission rates vary based on the affiliate, you could earn anywhere between 5-50% per sale.
In all cases, affiliate marketing is undoubtedly a model you should leverage at scale, especially that business spending on affiliate marketing is expected to reach $8.2 billion in the U.S. by 2022! So, now’s the time to tap into this billion-dollar industry!
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