Affiliate marketing is one of the oldest forms of digital marketing wherein you refer someone to any online product and when that person buys the product based on your recommendation, you receive a commission.

In other words, when you help another company generate sales, you get a commission.

Organizations like Amazon, Apple, Google have their affiliate program, which is free to join by any individual across the globe.

Affiliate marketing provides businesses with a 100% return on their investment. It is a performance-based marketing.

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How Affiliate Marketing Works

Lets understand how affiliate marketing work through the following points

Affiliate marketing can even perform better than paid ads as people tend to purchase based on the recommendation from someone they know and trust.

There is a famous quote about affiliate marketing is “making money when you sleep”

  • When an affiliate marketer joins the brand’s program, he or she is provided with a unique ID or a specific affiliate link (URL).
  • The affiliate shows the affiliate link in the forms of banners, blog posts, text links, etc. on their websites. 
  • The visitors click on the affiliate link and are directed to the merchant’s website through a tracking link.
  • The customer purchases products on the merchant’s website.
  • The merchant checks the sales record. If the purchase is associated with an affiliate ID, the transaction is credited to the affiliate.
  • The affiliate marketer gets a commission for his or her referral purchase.

Parties in Affiliate Marketing Playground

Merchant 

Merchants are organizations that sell their products online. Sometimes to increase sales, merchants are willing to outsource their sales efforts to affiliates for a commission. In short, the person/organization who runs the affiliate program is a merchant.

The Affiliate 

When someone earns a commission by selling products or services offered by merchants, that person is known as an affiliate. Sometimes the affiliate is also referred to as a “publisher”. Because he or she always uses a website to handle marketing. 

An affiliate doesn’t have to be an individual, it can also be a business, such as an LLC or corporation.

The Network 

An affiliate network brings together affiliates and merchants. Some companies (such as Amazon) act as their own affiliate network, while others join a third-party network. In recent years, Amazon Associates, ShareASale, Shopify are the top most prominent affiliate platforms.

The Customer 

Affiliates market the product to consumers who make a purchase. The consumer is the person who takes necessary actions after going through the advertisement. The action taken by the consumers will transfer them from the website of the affiliate to that of the merchant.

Types of Affiliate Marketing

There are several types of affiliate marketing. Below we are mentioning the most common types that affiliates would love to start with or merchants are willing to work with.

Coupon sites

People tend to search for available coupon codes before purchasing their desired product. Coupon sites that provide these coupons have quickly become one of the most popular affiliate channels.

Coupon sites are eCommerce-friendly websites and have a significant customer base. 

The site owners offer coupon/discount codes and earn commissions on sales through their links.

Bloggers

These types of affiliates are great when it comes to posting information about companies and reviews about new products.

All the things that bloggers write about tend to organically rank in the search engine. It’s quite important to look for a blogger who is willing to promote your products or your company and its services as this will help to increase your traffic and ultimately the number of conversions you get.

Email

Emails are the most preferred communication channel. Some affiliates have utilized their email lists to promote the seller’s products. They also use various campaigns to collect as many emails as possible. Then they send specific offers or newsletters regarding the products or services.

Social Media Channels

Social platforms such as Facebook, Twitter, Instagram, Youtube have become the primary channel where people interact with each other. Influencers who have the power to influence others will benefit the most from affiliate marketing via these social media platforms.

As they have a large number of followers, it is easy for them to direct consumers to the merchant’s products via social posts, videos, live streams, and other interactions.

Conclusion

Affiliate marketing has proven to be a fruitful way to build profits for both publishers and brands. Affiliates can help in boosting sales and help the customers to make an informed decision while purchasing products.

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