affiliate-marketing

What is Affiliate Marketing? And How Can It Help Me Make Money Online?

what is affiliate marketing

Let’s introduce you to the world of affiliate marketing.

If you’ve landed on this page, chances are you’ve heard about affiliate marketing but you’re not quite sure how it works. With this article, I’ll give you a good idea of what is affiliate marketing about, the myths surrounding it, and how you can get involved in the lucrative world of affiliate marketing yourself.

Most of you, and perhaps some of the 90s kids can recall the rise of pop stars like Britney Spears and Christina Aguilera. But most people will tell you that the 90s was also an important era where the World Wide Web (aka The Internet) becomes a reality.

With this new technology, many companies realized that they now have access to not only the local customers, but customers from all around the world. And what better way to expand your business than to have other people promote your business for you?

At the same time, many website owners were creating contents that were extremely helpful and valuable to the internet users. Soon, companies partnered up with these website owners to market their products and services, and promised to give a commission when the website owners generate sales for them.

Thus, affiliate marketing was born.

So, How Does Affiliate Marketing Work?

 

affiliate-marketing

In short, affiliate marketing at its core is all about partnerships and relationships. There are 4 main components when it comes to affiliate marketing:


Advertiser


In affiliate marketing, an advertiser can be a company selling their products, such as electronics, clothing, weight loss pills, car parts, basketball shoes, you name it.

Or, an advertiser can also be some insurance companies trying to market their insurance policies and bring in new customers/policy holders.

In short, an advertiser is someone who is ready to pay other people to help them promote their business. It can either be huge multinational companies such as Nike and Coca Cola, or new startups that are trying to get some exposure through the publishers.


Publishers


A publisher is an individual or a company that promotes an advertiser’s products and services. In exchange for their advertising efforts, publishers get a commission from the advertisers when a new sale or desired action has been performed by a consumer.

Traditionally, the publishers are often website owners that contractually agree to work with an advertiser to promote their products. In turn, the advertisers provide the publishers with creatives – links, banner ads or text ads that the publishers can display on their websites.

When we talk about starting an online business, many aspiring entrepreneurs choose to become a publisher due to the low entry barrier. All they need to do is to have a website and put up valuable contents for their readers (who are also consumers).

They can then choose to work with their trusted advertisers and earn commissions when the readers/consumers purchase an item or sign up for a service that they advertise.


Affiliate Networks


Advertisers often submit their offers to affiliate marketing networks that aggregate a huge amount of offers from different advertisers.

You can think of affiliate networks as the middle-man between Advertisers and Publishers, where Advertisers display their offers and Publishers choose which offers to promote.

Affiliate Networks also tracks affiliate sales generated by Publishers and handle payments from Advertisers to Publishers for valid leads and sales.


Consumers


The last component that completes the affiliate marketing cycle is the consumers. The consumers are the readers and internet users that see the advertisements.

If they are interested in an offer, they perform a desired action (either by clicking on an affiliate link, submitting their information using sign-up forms, or purchase a product/service).

This action takes them from the publisher’s website to the advertiser’s website to complete the action, which is what we call a conversion.

Once a conversion has been completed, the advertiser awards the publisher with a commission.

Myths Surrounding Affiliate Marketing

 

There seems to be some myths that won’t go away when it comes to affiliate marketing. Now’s a good time to take a look at a few popular ones and bust the myths.

1. It’s Difficult to Get Involved in Affiliate Marketing

Affiliate marketing is actually something that anyone can do, as long as they are willing to put in some effort and learn on the go.

In fact, most successful affiliate marketers got involved in affiliate marketing without having any prior technical and marketing experience.

Nowadays, the entry barrier is getting even lower with free training modules aiming to build an online business with affiliate marketing from scratch.

2. Affiliate Websites Don’t Need Much Maintenance

It’s a fact that many affiliate marketers make more than $100,000 per year from affiliate marketing, and they seem to work from the beach perpetually.

While this is the impression many people may have about affiliate marketing, starting a business with affiliate marketing is actually not very different from starting any other forms of online and offline businesses.

An affiliate marketer needs to keep learning and improving, and treat his/her website as a real business in order to thrive.

3. You Should Always Choose the Most Profitable Niche

When starting an affiliate marketing business, most people will go for the “hot niche” because they believe that’s what will make them the most money.

While you may have a chance to earn big with a hot niche, what works for other people doesn’t necessarily work for you.

Your best bet when starting an affiliate marketing online business is to choose a niche you are interested in, and one that you can work with for months and years to come.

For more details, read How to start an online business for free.

The Bottom Line

 

Now you should have a better idea on what affiliate marketing is all about, and also the resources to start your online business if you wish to establish an extra source of income.

While it is not easy to get an online business up and running, most people can definitely make it a successful one while holding a full-time day job. Time and time again, we see employees from all walks of life build a successful affiliate marketing business by being a part-time entrepreneur.

For many people, affiliate marketing was, and will continue to be a way to escape from traditional employment, and eventually escape the rat race altogether.

 

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15 Comments

  1. Earn X

    Hi,
    l will like to know the best Affiliate site that is lucrative to earn money. l love the extensive explanation you gave on Affiliate marketing and how it can help to make money online, this is very useful especially for Newbies.
    Your article has helped me a lot to fully understand what Affiliate marketing is.
    thanks for this

    • Edward

      Hey there, most people start with the Amazon associates program, which is one of the biggest affiliate programs around.

      Otherwise you can look into other affiliate networks like Maxbounty or Shareasale where there are thousands of offers to promote and make commissions.

  2. Weston

    Great post! You explain affiliate marketing very well. I’ve been an affiliate marketer for the last few months now and love it. I love that I don’t have to worry about having my own product or having to deal with shipping the products to customers. And affiliate marketing is free so it’s a great way to make extra money.

    I like how you explain the myths of affiliate marketing. Like you explained, affiliate marketing is easy to get involved with, but, like any business, it takes a lot of time and hard work. The affiliate marketers that work from the beach probably started out working hard and long hours on their website and niche.

    How long have you been an affiliate marketer?

    Thank you!

    Weston

    • Edward

      Hey Weston, I’ve been working on this for the past 3 years, but I’ve only really started to see results around 1.5 years earlier after joining Wealthy Affiliate. It’s been a game changer for me.

  3. Jen

    This is great information on what affiliate marketing is, as well as what it isn’t. The myths are probably all the things most people hear about and if you mention you are going to start a website with affiliate marketing, people often say it’s too difficult or it won’t work for your niche. Now here is some information to give them that helps reinforce why you are doing it.

    I thought this article was also helpful for someone like me that wants to get more into affiliate marketing on my site, but isn’t really sure where to start or what an advertiser versus publishers is. We may hear the terms all the time, but aren’t really sure what it means. Thank you for providing more information! This was very helpful.

  4. Joshua

    This is a really great article! I am just getting into affiliate marketing and have set up my own wordpress website in a niche that I love.

    I’m just interested in your thoughts about the future of affiliate marketing… do you see it being something that will always be around, or do you think it may evolve into something else? I’d be interested to know what you think!

    • Edward

      Hi Joshua, glad you found it helpful!

      Affiliate marketing will always be around, in fact it has been around since the dawn of internet. Businesses are always looking to expand their reach, and affiliate marketing is an indispensable tool.

      I’d foresee affiliate marketing to rely more heavily on mobile traffic, now that a lot of users are browsing through their phone. So optimize your website to mobile pages too!

  5. Bobby

    So glad to find this page.
    I have a close friend that is looking for an online business to start. If she started with affiliate marketing like you said, is there training involved? She does not know much about online marketing. How much would she need to invest up front? Is there a good return on her money invested? These are just a few questions that I know she would want to know.
    I will send her to your site for more information and tell her to contact you.

    • Edward

      I always recommend people to get free affiliate marketing training over at Wealthy Affiliate, no exception here.

      Typically there’s no upfront investment, but if she’s finished the basic training and wants to go further (learning advanced techniques and getting premium website hosting) it’ll be around $47/mth investment. I invested for 1 whole year which brought down the price to just $29/mth.

      For me I made back all the investments within first few months, and since then I’ve been generating over $1,000/mth online. Of course individual results vary, but I’ve seen many more people who get much better results than mine.

  6. Emmy

    I like your review of Affiliate Marketing and any newbie in
    online business will be able to understand it. How can one escape the rat race of a 9.-5 job and be comfortable in earning a stable online income?. I have tried before and have fell in the hands of scammers.

    • Edward

      Read up a few of the scams I’ve reviewed and learn the basic pitfalls. You’ll come across new scams again, so equipping yourself with knowledge is the best way to protect yourself.

      The only platform I recommend is Wealthy Affiliate like what I’ve mentioned in some other comments.

  7. Tooting Tummy

    Glad I came across this website. Thanks Edwards for your post on affiliate marketing and your rather detailed and yet simple explanation of how affiliate marketing works, with the complete process. Yes, it is true that there are many myths about it, and most often people think affiliate marketing is a big money making racket and a scam! But it actually isn’t! Kudos to a great article about how to achieve financial freedom by simply running your business online.

  8. Hi, re Clickbank – do you have ideas about improving conversions on a varied webpage? I have a image uploading website and as such it’s near impossible to match offers to the visitor. regards

    • Hi Tamela,
      It’s better to use responsive ads like google ads for websites like yours. It will automatically present a relevant ads based on the search pattern and browser history of the user.
      Regards,
      Edward

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