Is it really possible to make money from affiliate marketing? Definitely! You can earn extra income or even full-time income without leaving the comfort of your home. However, it isn’t really that straight forward. Like many other online businesses, you must educate yourself and be on top of your business if you want to be successful.
But what is affiliate marketing in the first place? In short, affiliate marketing is the process of earning a commission by promoting other people/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 with no additional cost to the buyers.
Simply put, businesses are always looking for new customers. Sometimes, it’s easier to pay someone else when they refer a customer to you instead of more traditional means of marketing and advertising.
Is affiliate marketing easy?
Like most online businesses, there are so many self-proclaimed gurus and the get-rich-quick schemes that try to give the impression that affiliate marketing is a way to make quick money without any serious effort. You’ve probably heard some of these claims and how they promise to help you make thousands of dollars monthly without doing anything. Some of them will even make you believe all you have to do is set up an affiliate site, and fold your arms while it makes money for you.
Affiliate marketing is just like any other businesses, where there are a few wealthy ones, a good number of successful ones, and thousands who are barely making anything substantial. There is no doubt that you can make money with affiliate marketing because it is a viable business. However, the big question is whether or not it is a business model for you.
One key point to realize is that affiliate marketing is not radically different from other forms of online marketing. In fact, affiliate marketing overlaps with regular internet marketing quite significantly with its focus on SEO (Search Engine Optimization), PPC (Pay Per Click) advertising, email, sales funnel and other content marketing methods. For all of these reasons, affiliate marketing is a great business for beginners to learn about online marketing. If you can sell affiliate products then you can essentially sell anything online.
How Does it Work?
The business model is quite simple and easy to understand:
- You, as the affiliate, promote another company’s products in your own marketing efforts to bring sales or leads for that company. It could be done through social media, a blog, email marketing, paid ads, or any other marketing channels you use.
- Once a customer clicks on your affiliate link, they are tracked using a special code so that you get credit if they end up making a purchase.
- If the customer does make a purchase, you’ll then receive a commission. This could be anywhere from 5% to 50%, in some cases 100% of the sale.
Now at first glance getting a fraction of a sale might not seem that fruitful. However, if you do the math, you’ll see that those fractions quickly add up to a not insignificant number! Especially if you’re sending hundreds of customers to a company. Keep in mind; you’re not actually doing any of the heavy lifting, all you’re doing is referring the business.
Will this happen overnight? Definitely not. Like most businesses, success takes time, and affiliate marketing is no different. Affiliate marketing works though, and if you’re willing to put in the time, you’re going to see some significant rewards down the line.
In addition, don’t expect this to be a zero-capital required business either. It does require some initial capital investment to kick start your business, either to host a blog and sales funnels, or to drive traffic. Yes, it is possible to do it without any capital, however without the proper tools required, it will take you a long time to start seeing any money coming in. That also doesn’t mean you’ll need to take out a big loan to start an affiliate marketing business. The great thing about online business is that you only need a few hundred bucks or less to get started.
Who Does What?
When it comes to affiliate marketing, there are typically four parties responsible for making the process work.
- The Creator – generally speaking, this is the inventor of the product or service. They create the work, and they own the rights to that work. This can be digital content (similar to this guide) or a physical product.
- The Network – affiliate networks are the primary gateway linking product creators and affiliate marketers together. Using an affiliate network, creators have a site where they can share their product with marketers around the world. Marketers are able to similarly search for different products that suit their audience quickly and easily. A common question is why do creators not go directly to marketers? The simple answer is scale – affiliate networks often have thousands of different products available, so they tend to have the most marketers. As the majority of affiliate marketers use networks to source products, creators are more likely to find a match versus trying to source a marketer independently.
- Some Popular Networks – some big-name networks that you should definitely look at are Clickbank, JVzoo, and Shareasale. Another one that is also worth mentioning is Amazon. Amazon specifically has an excellent affiliate program – called Amazon Associates – which is free to join. With a global reach and true name brand recognition, Amazon by itself can help you realize your dreams of passive wealth. Stay tuned as I’ll demonstrate how simple this really
- The Marketer – which is you. The screenshot provided earlier is an example of what a “super affiliate” can make so as you can see, it’s possible to become quite wealthy as an affiliate marketer. Super affiliates, by the way, are those individuals that have discovered and dominated a specific niche where they generate the biggest percentage of an affiliate program’s profits. Affiliate marketers do the grunt work of promoting a product or service – they recommend and guide users in a specific direction and when a sale is made, they receive some compensation as a reward for their marketing efforts. I’ll get into some details of different strategies to market products online later on.
- The Customer – the customer is truly the deciding factor for any business and not just online ones. If the product or service does not meet a customer’s needs, then significant sales are unlikely, regardless of how well a product is marketed.
Advantages of affiliate marketing
Here are some of the benefits of affiliate marketing:
- You don’t need a lot of money to start. Unlike many other businesses out there, affiliate programs won’t charge you to join.
- You don’t have to create any product or service.
- There’s no need to ship or stock products.
- With internet access, you can work from anywhere and anytime you want to. No one will control your work hours, or yell at you when you’re not generating results.
- Depending on your online marketing skills, it has the potential to earn you passive income. That means once you have everything in place, you can leave the business aside and do something else, while still collecting commissions.
- You can add it to an existing home business venture to create an extra source of income. It is perfect for coaches, bloggers, information entrepreneurs, including anybody with a website.
Disadvantages of affiliate marketing
Here are some of the challenges of affiliate marketing:
- It may take a while to generate the traffic you need to make money.
- Sometimes people might not be credited for their referral due to bugs or hijacking.
- Your credibility can be ruined through bad affiliate referrals. This is why you need to work with quality businesses to avoid such.
- You don’t have any control over the products, service, business or the way the business is run.
- Some companies have a reputation for defaulting payment. Thus, it is important to only work with reputable affiliate programs.
- Very competitive. Most of the great programs are often very competitive.
- The merchant owns the customer. You can know the number of sales per product through your stats, but most times, there’s barely any information about the customer which is why it is often difficult to get re-sales. That’s why it is important to build an email list and properly segment your subscribers.
How to succeed as an affiliate marketer
The fact that it does not require much startup capital is a factor that makes affiliate marketing an attractive business. There’s no product or inventory management needed. You don’t have to deliver any service. You basically get paid for referring customers and clients to existing businesses.
Affiliate marketing is not a difficult business, but like any other venture, it requires a great deal of planning, knowledge and effort to succeed. Here are some pointers to help you succeed in affiliate marketing:
- The first step is to learn all you need to know about affiliate marketing and the necessary steps to succeed.
- Make sure the products and services you will be referring are great quality. You can decide to buy the products to test their quality. Or better yet, promote the products that you’re already using in your daily life or business. The products and services you’re promoting will have a great impact on your business, which is why you need to focus on the quality and not just the income.
- Carry out research on the affiliate programs you are interested in to understand how they work, and how you will be paid. You need to ensure it would be a good fit for your business.
- Select at least one channel to deliver your message out to the world. The most popular choice is a blog, but it could also be social media, email, or sales funnel landing pages. Better yet, why not do all of them? The more channels you can reach out to your audience, the better it is!
- The affiliate items you choose should match the content of your website or niche. For instance, if your content is about figure skating, picking affiliate links connected to items like motorcycles or cars will not help you.
- Disclose every affiliate relationship. Visitors are likely aware that you get paid from graphic ads, but if you use an in-text link or write a review as a recommendation, you want to disclose that it may lead to compensation as well. It is actually required by the FTC, but apart from that, it also helps you build trust with your readers.
- Don’t just rely on social media or SEO alone to drive traffic to your website. You need to understand your target market. Know where to find them and learn how to attract them to your site. There are lots of free and affordable marketing strategies that you can use to promote your affiliate business.
- Create an email list. You may have heard the saying “the money is in the email list.” All of the biggest affiliate marketers out there use email for their affiliate marketing. Email marketing is a great way to boost your affiliate profit.
- Market your business through a funnel system and lead page. Use free offers to attract potential customers to your email list, and then use that opportunity to transfer them to the affiliate product page. In your follow up emails, you can offer other amazing affiliate deals along with free content providing great value to your audience. You need a solid understanding of sales funnel if you want to launch a successful business.
- Monitor the progress of your affiliate programs, especially if you have a lot of programs or/and if you’re using ad types like Google AdSense to make money. Too many ads sometimes distract readers or dilutes the site, causing a dip in performance.
- Although it doesn’t require much capital, but it will take you a long time to make any substantial money if you don’t invest in your business. You do need to put in some cash if you want to grow your business faster.
Before you start your own affiliate marketing business, it is important to educate yourself and learn all you need to know about the business. And if you decide to pursue this business, or wish to add affiliate marketing to your existing online business, understand that it’s not fast, automatic, nor without any effort. The beginning is always the most difficult. You will have to put in tons of effort, hard work, and planning to get the business running.
At the end of the day, there is no real easy way to make money online. If anyone told you so, then they are probably trying to sell you something. However, if you’re determined in creating something online, where you can work in your own terms, and more importantly, generate you extra cash on the side, then affiliate marketing is a great business model.