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The Beginner’s Guide to Affiliate Marketing
The Beginner’s Guide to Affiliate Marketing
The Beginner’s Guide to Affiliate Marketing
What is Affiliate Marketing and how to get started?
Affiliate marketing is a thriving $17 billion industry* globally growing at a rate of 10% per year. Affiliate marketing remains a top performance channel for marketers due to its high earnings potential for both advertisers and affiliates.
Advertisers/Brands can see up to 30 percent or more of their total revenue driven by affiliate marketing. 31% of web publishers and 20% of Advertisers say affiliate marketing is their most successful channel with the average affiliate marketer earning $8,038 per month.
If you’re a new Advertiser or publisher keen to learn about how Affiliate Marketing can help you then, The Beginner’s Guide to Affiliate Marketing will give you a step-by-step guide on the basics of the affiliate marketing channel.
Topics covered in this guide
- What is Affiliate Marketing?
- How does Affiliate Marketing work?
- What is Tracking?
- Key benefits of Affiliate Marketing
What is Affiliate Marketing?
Affiliate marketing is a performance-based marketing strategy where businesses (advertisers) reward affiliates (publishers) for driving traffic or sales to their products and services through the affiliate's marketing efforts. This symbiotic relationship benefits all three parties involved: advertisers, affiliates, and consumers. Let's delve into the roles and dynamics of each party in this system.
1. Advertisers (Brands/Merchants):
Advertisers, also known as brands or merchants, are the businesses that sell products or services. They partner with affiliates to expand their reach and drive more sales. Advertisers provide the affiliate with marketing materials, such as banners, links, and promotional content. They track the performance of affiliates and pay commissions for sales or leads generated through the affiliate’s efforts.
2. Affiliates (Publishers/Partners):
Affiliates, also referred to as publishers or partners, are individuals or companies that promote the advertiser's products or services. They use various marketing tactics to attract and refer potential customers to the advertiser's website.
Affiliates leverage blogs, social media, email marketing, or websites to create content and share affiliate links. When a consumer clicks on these links and makes a purchase or completes a desired action, the affiliate earns a commission.
3. Consumers
Consumers are the end-users who purchase products or services through the affiliate links. Consumers interact with the content created by affiliates, click on affiliate links, and make purchases on the advertiser's website. Their actions are tracked to ensure the affiliate receives credit for the referral.
Common places to find affiliate links:
- Blog posts
- Coupon or voucher websites
- Product review or comparisons
- Media & content rich websites
- Mobile Apps
- Email campaign
- Social media influencers or KOLs
- Banner advertisements
How does affiliate marketing work?
The process of affiliate marketing can be broken down into a few straightforward steps:
1. Sign-Up
Affiliates join an advertiser’s affiliate program, typically through an affiliate network or directly via the advertiser’s website.
2. Promotion
Affiliates promote the advertiser’s products or services using unique affiliate links provided by the advertiser. These links contain tracking codes to attribute sales or leads to the respective affiliate.
3. Consumer Action
When consumers engage with the affiliate’s content and click on the affiliate links, they are redirected to the advertiser’s website. If they make a purchase or complete a specific action (such as signing up for a newsletter), this is tracked.
4. Commission
The advertiser validates the transaction, and the affiliate earns a commission based on the agreed terms. Commissions can be a percentage of the sale or a fixed amount per lead or action.
5. Payment
The advertiser transfers the money to an affiliate network and the money is paid to the affiliate.
What is Tracking?
Tracking is a core component of any Affiliate Marketing campaign and getting this right is essential. Many Affiliate Platforms will offer tools and integrations into popular Ecommerce platforms such as Shopify, Magento & WooCommerce alongside more traditional Tracking Tags and Server-to-Server (S2S) configurations.
Explaining affiliate tracking, simply (to a 5 year old):
We work with our friends to put special tags on their websites. These special tags help us see when people visit or do things like ask for prices or buy stuff. Then, we can discover which friend sent the person to the store and give them a prize for bringing in a customer.
Key benefits of Affiliate Marketing
Affiliate marketing offers a multitude of benefits for Affiliates & Advertisers. We'll outline some of these below.
Benefits for Advertisers
The performance-based nature of the channel means that Advertisers only pay for actual results, such as sales or leads, making it a highly cost-effective marketing strategy. This reduces the risk of spending on unproductive advertising. Furthermore, Advertisers can control their budget by setting commission rates and limits, ensuring they don’t overspend. Post-conversion validation ensures the channel remains low-risk (as spend occurs after the event) and ensures higher traffic quality.
By partnering with affiliates who have established audiences, advertisers can reach new and diverse customer segments that they might not have accessed otherwise. Affiliate Network provide easy access to affiliates in different regions and can help advertisers tap into international markets, expanding their global footprint.
Affiliates promote the advertiser’s products through various channels, such as blogs, social media, and email, increasing the brand’s visibility and awareness. Affiliates often have loyal followers who trust their recommendations, which can enhance the credibility of the advertiser’s products.
Affiliate marketing platforms provide detailed analytics and insights, helping advertisers understand which affiliates and strategies are most effective. Choosing the right affiliate platform is essential.
Benefits for Affiliates
Affiliate Marketing offers a wealth of monetization opportunities for affiliates, publishers and partners alike. Affiliates can earn passive income by promoting products or services through their content, allowing them to monetize their blogs, websites, or social media platforms. Those specialising have the potential to earn high commissions, especially if they choose profitable niches and high-converting products.
There are lots of tools available today which means starting as an affiliate requires little to no initial investment, making it accessible to individuals and small businesses. Affiliates don’t always need to create their own products; they can focus on promoting existing products from advertisers, but building up brand loyalty is important to get repeat consumer visits across various channels including blogs, social media, YouTube, email marketing, and more.
Advertisers can explore our Affiliate Network or discuss your options with one of our Affiliate Marketing Experts.
Publishers join our network today to start promoting our range of exclusive, global advertisers.