What Is Affiliate Marketing and How Does It Work?

Marketing is a powerful set of tools which are used to promote a brand, product, or service. Modern companies want to use the most advanced and effective techniques to achieve their purposes and attract more customers to their websites. Types of marketing are numerous. One of the popular varieties is affiliate marketing. In the article, we’ll observe its peculiarities and find out why it is so popular among modern marketers.

What’s Affiliate Marketing?

Affiliate marketing is a way to earn cash from the fees paid for the promotion of the other trademark, service, or product. Affiliates are those people who organize online marketing on behalf of a merchant. The main aim, in this case, is to attract more traffic to the company’s site and to increase conversion rates. The seller pays an affiliate for every click or conversion. Thus, the amount of income greatly depends on the effectiveness of attraction of customers.

To become an affiliate, it’s recommended to be sure you’re capable of attracting people to the merchant’s site. Thus, the most successful affiliates are usually users who have their own websites with regular visitors. Such websites might be effectively used as platforms for the promotion of other products or brands.

When a person finds a suitable affiliate program, it’s necessary to define a payment model, which will be used for compensation. The most widely applied ones are:

• PPC (pay per click)
• CPA (cost per acquisition).

The popularity of affiliate marketing is undoubted. If we have a look at the statistics, we can see that over 80% of all trademarks and publishers benefit from affiliate marketing. What’s more, about 15% of the income of the entire digital media industry comes from this type of marketing.

Affiliate Marketing Step By Step

This type of marketing is a wonderful way to increase your income. The strategy works the following way:

Step 1.	Define a suitable niche/direction to be able to effectively promote it.
Step 2.	Join an affiliate program (the conditions are described on the websites of the corresponding companies).
Step 3.	Advertise the selected company/site/product.
Step 4.	Monitor conversions and try to optimize them.
Step 5.	Get your compensation for promotion.

Selecting Your Direction

There exist thousands of categories of items and services on which it’s possible to concentrate. The choice of a niche is crucial for your success because the more effective your promotion is, the more money you can obtain. There’re a few recommendations that will be helpful for potential affiliates:

1. Pay attention to the competitiveness of the category. If there’re too many people in the niche, it will be much more difficult to bring valuable traffic and provide conversions.
2. Estimate your knowledge of the category. It’s strongly recommended to select niches which you are familiar with. If you have a travel site/blog or are just fond of the area, it’s better to choose a travel niche.
3. Think about your experience in a selected category. For example, you might use certain products and already know about them from your own experience.
4. Make sure you are ready to spend time to know more about the selected category. There’s no necessity to be an expert, but it’s better to choose a promising niche and make your knowledge in it deeper. 

Advantages of Affiliate Marketing

To understand why businesses like affiliate marketing and frequently use it for the development and promotion of their brands, it’s required to consider the key benefits:

• Lower expenses. There’s no need to have a huge budget to organize an effective marketing program. Working with affiliates, a businessperson won’t have to think about advertising or hire an expert team. The promotion of a business will depend on the selected affiliates and their content. For instance, you need to promote an online casino while your affiliate writes a Golden Lion casino review. It’s valuable content with important information for potential gamers. At the same time, it adds to the promotion of your site. The ongoing expenses are also low due to the fact that it’s required to pay only for certain actions (purchases/registrations). The cost will never change.
• Minimal risks. There’s no necessity to pay to affiliates on a regular basis. The compensation is provided only in the case of a certain action (for example, conversion). Thus, there’re almost no risks to losing money in vain.
• Targeted traffic. The customers, who visit your site thanks the work of affiliates, are usually valuable. It’s because each affiliate can be selected by you after the estimation of the provided content. If an affiliate’s site is related to your industry, it’s quite likely that you will get customers interested in your product or service.
• Greater flexibility of a business. With affiliates, it’s much easier to develop your start-up. The affiliate program might be made smaller or bigger without any additional expenses. It means that a business person doesn’t require a huge sum of money.
• High returns. It’s really difficult to guarantee great returns with almost any type of marketing. However, affiliate strategy is an exception. It’s considered the most effective type of marketing in terms of ROI. It’s because the target audience hears about your trademark/item/service from an affiliate within the sphere of influence.

Effective Ideas for Affiliate Marketing

We offer a few ideas, which might later be effectively used to earn on affiliate marketing programs:

• Reviews of products. If you start observing various products based on your own experience, then you have good chances to turn it into a wonderful source of income by means of affiliate marketing. Note that over 90% of buyers tend to first look at the reviews before purchasing anything.
• Tutorials. It’s very interesting for purchasers to look at how a certain item can be used. Such publications and videos collect many views, so the chances to effectively use affiliate marketing, in this case, are great. It’s better to add some problem-solving content to increase the interest of your audience.
• Landing pages. These are special web pages that lead directly to the affiliate company. Such sites are conversion-oriented. It’s a nice option for those who are going to build a greater marketing campaign and apply social media, email, and other advertising strategies. Thus, the creation of a landing page can be the last step in a bigger campaign, while the traffic to your landing might come from SM or email newsletters.
• Posts on social media. There’re great opportunities on SM. Users can create texts, images, infographics, or video materials to make the audience interested. With the right content, it’s very easy to drive traffic to the affiliate site. It’s just required to keep in mind that regular engagement with the audience is required to support their interest.
• Informational videos. Video materials are much more effective compared to texts. Many people are not very eager to read long paragraphs. It’s a good idea to transform your written review of a product or something into a video. Thus, you can increase the amount of traffic to the affiliate website and your income correspondingly.

Affiliate marketing is a very effective tool for the promotion of business and an additional way of income for advertisers. Once you have valuable content (blogs, videos, posts, etc.), try to take benefit of it and find a suitable affiliate program. Being consistent, you will be able to obtain a significant regular profit, which can even be passive.