What is Affiliate Marketing?

To many, the holy grail of online marketing is earning yourself a sizable passive income. Once you have done some preliminary work, you can sit back and wait for the cash to roll in. Of course, for most people, it isn't as easy as that, and like the knights of King Arthur, many people never find their nirvana.

But some people succeed in making a decent level of passive income. The most common method of achieving involves affiliate marketing.  You promote other people's products, make sales, and get to keep a portion of the profit. Other people make the products; you promote them and receive a commission for your efforts.

Of course, there are some pitfalls along the way. It is hard to sell on the internet if nobody knows of your existence. But if you already have a sizable online following – perhaps you already qualify as an influencer, for instance – you have the potential to make that lucrative and much desired passive income.

Sign up as an Affiliate

What is Affiliate Marketing?

Notable Highlights from our Affiliate Marketing Report

• In 2024, the Affiliate Marketing Industry will grow more than $15 Billion
• In 2021, Affiliate Marketing platforms and services raised over $300M in funding
• Affiliate Marketing related services grew by 26% globally with 10,000 firms specializing in affiliate marketing service
• Amazon Associates retains more than 20% market share and is the world’s largest affiliate network
• Marketing Departments  allocated 9% of their budget to affiliate marketing efforts 
• Affiliate fraud is the primary concern of 7 out of 10 brands but only 3 out of 10 have been affected
• Between 2017 and 2021, interest in affiliate marketing grew to more than 300%
• 25 out of 100 brands partnered with bloggers for their affiliate marketing campaigns

What is Affiliate Marketing?

In many ways, affiliate marketing is a modern version of traditional commission selling. Brands (affiliate merchants) pay a percentage for every sale generated by an influencer (affiliate marketer).

Affiliate marketers promote the products using a unique link to the brand’s website. Once buyers purchase the product from their link, the affiliate earns a commission as a reward. Websites use cookies to keep track of the buyer’s visits so even if they decide to purchase at a later time, the sale is still credited to the affiliate. 

Affiliate marketing is a form of revenue sharing. People who have products, but not a captive audience, can increase their market by working with people who have an audience, but not a product.

Influencers make good affiliate marketers because they come with a ready-made online audience.

Who are the Parties in Affiliate Marketing?

Affiliate marketing involves either three or four parties, depending on the individual situation. The Consumer pays the money.  Each of the other parties takes a cut of that money. The relevant groups in these transactions are:

1. The Product Creator (or Merchant) – these are the firms that provide products for sale. This party has multiple names: creators, merchants, sellers, brands, retailers, or vendors. In short, they have products that they wish to sell.
2. The Affiliate Network – this is the optional party on this list. Although some product creators interact directly with affiliates, many others use an intermediary instead. Indeed, in some cases, such as Amazon, affiliate networks also double up as retailers. Affiliate networks work with product creators to collate a catalog of products, which they make available for affiliates to sell.
3. The Affiliate Marketer – these people select one or more products and encourage their online readers, viewers, or contacts to buy them. Affiliates can promote and create sales links on their websites (or even build specialist sites to review the products) or social channels.
4. The Consumer – ultimately, somebody has to buy the products. The Consumer takes notice of recommendations made by the affiliate marketers, follow their customized links, and purchase the products.

How Does Affiliate Marketing Work?

Product creators make, import, or acquire products to sell. They decide to share a proportion of the sales revenue with the people who sell their products.

Depending on each creator's size, they will decide to either work directly with affiliate marketers or to work through an affiliate network.

The affiliate networks act as an intermediary between the creators and the affiliate marketers. 

When somebody decides to act as an affiliate marketer, they usually sign up to one or more creators or affiliate networks. At this point, the affiliate merchants often decide on which products they wish to sell. 

The creator or affiliate network will give a personalized code to each affiliate marketer. This means that the affiliate marketer can include their code in the URL when they link to products they wish to promote, and the creator/affiliate network will know who sent each customer that makes a purchase.

How Do You Become an Affiliate Marketer?

If you decide to become an affiliate marketer, you need to follow a series of steps.

1. Decide the niche in which you choose to specialize. If you are already an influencer, this should be simple – you would sell products that are of interest to your existing followers in your niche. When Pat Flynn of Smart Passive Income decided to become an affiliate marketer, he looked for products that appealed to people wishing to make money online – they are the types of people who come to his website and listen to his podcasts every day. He chose to sell the kinds of tools he knew his audience would use, e.g., Bluehost web hosting, ConvertKit email marketing, and Teachable online courses. 
2. Review affiliate products in your niche. Now you know the types of products you wish to sell, you need to decide upon the exact products you want. Again, many influencers and top bloggers restrict themselves to products they use themselves. Other people don't necessarily do that, but they do ensure that the products are of acceptable quality and not likely to harm their reputation because of their association with them.
3. Apply to become an affiliate marketer for the product in question. You will either apply to the appropriate affiliate network or direct to the affiliate merchant, depending on how they set things up
4. Collect emails and build your audience. The exact methods you use here will differ from affiliate to affiliate. You aim to build up as many leads as possible. Some people create a new website for each affiliate product, where they write reviews and relevant blog posts. Others use their existing sites and social pages to promote the products to their current followers. Influencers have an advantage over others here. 
5. Consider scaling your affiliate marketing with Pay Per Click (PPC) online advertising on Google and Facebook (or other social networks depending on your audience)
6. To gain access to a broader audience, some affiliate marketers outsource some of their marketing to other influencers, in the expectation that the additional reach of the influencers will generate sufficient sales to more than pay for the influencer costs.

Benefits of Becoming an Affiliate Marketer

Affiliate marketing is a lucrative business that can earn huge passive incomes when done correctly. The promise of these “earnings while you sleep” is what draws a lot of people to try their hand at affiliate marketing. 

Here are other reasons why affiliate marketing is a profitable business venture.

1. Affiliate marketing is low risk. You only spend time and resources marketing the product. You don’t have to develop the product, manage inventory, or deal with customer service.  
2. Commissions are generous. Most affiliate programs offer huge commission rates for as many purchases as your affiliate link can produce. They don’t set a cap to how much you can earn and some even reward consistent high performance.
3. You don’t need any upfront investment. Joining an affiliate marketing program is usually free. While you should personally use a product, it’s not required. 
4. The business is scalable without the need for additional manpower. You can always introduce new products to your followers and increase your affiliate revenues without hiring extra help.
5. You can make money simply by promoting the products you already use and love. Most of the products you use already have an affiliate program that you can join. Check out these courses to make money online to get more ideas.

Tips to Begin a Successful Affiliate Program

Here are further tips to help you become a successful affiliate marketer:

• Create an affiliate marketing strategy on how to promote your offer. Before you can earn passively from affiliate marketing, you need to invest time and energy in building your business. Set up goals and metrics to know if your strategy is working or if you’d need to tweak it.
• Use the product and create good reviews based on your personal experience. People value authenticity and trust. They’d want to know that they can trust your opinion, and giving honest reviews is one way to accomplish that. 
• Promote affiliates you’d use and limit the number of affiliates you promote. Just because a brand has an affiliate program doesn’t mean you have to join it. By only promoting a limited number of brands, you show your audience that you only vouch for the products you believe in.
• Talk to product experts. Aside from giving your personal opinions, the views and opinions of product experts give depth to your recommendations. 
• Share product tutorials. By teaching your audience how to use the products you’re endorsing, they’re more likely to see how it will be useful for them. “How-To” searches are also popular ways to lead more people to your website or content.
• Add bonuses for people who’d use your affiliate link. It’s common practice to add personal bonuses such as one-on-one coaching sessions or access to a private group as bonuses for people who sign up through your link. This gives them extra incentive to choose you over other influencers also promoting the same product.
• Always disclose to your followers if you’re using affiliate links. Not only is it required by law, but it also improves trust between you and your audience.

Types of People Who Become Affiliate Marketers

There is a wide range of people who choose to become affiliate marketers. Some of the most common include:

1. Influencers -these people already have a sizable social audience, as long as they promote products relevant to their followers. They can easily impact the purchasing decisions of many people in their specialist niche
2. Bloggers – again, many successful bloggers already have an inbuilt audience, to whom they can promote relevant products. They usually have an excellent understanding of SEO so know how to write reviews and other promotions in a Google-friendly style
3. Creators of specialized micro-sites – this is one way that people who have not yet made a name for themselves online can still get into affiliate marketing. They create a dedicated website devoted to a product and supply in-depth reviews. These can take some time to be visible to Google, however, so you probably would need to design sponsored ads elsewhere linking to this site
4. Email marketers – if you specialize in products relating to a particular niche, you may be able to build up a sizable email list over time. You can use email marketing to promote your affiliate products

Why Influencers Make Good Affiliate Marketers

On the surface, affiliate marketing seems like an easy way for somebody to make loads of income. The problem is unless you already have a sizable online audience, it can take much time and considerable hard work to build a large enough audience to whom you can sell your products.

But, there is one notable exception to this rule. Influencers already have a sizable audience. And by definition, influencers have sufficient clout with their audience, that they can convince them that it would be a good idea to purchase these products.

When you’re an influencer, your followers already trust you and value your authenticity. They know that you won’t risk your reputation by endorsing a bad product. Followers will almost immediately buy anything an influencer uses and especially endorses. 

Merchants can expect their products’ sales would skyrocket if they get influencers as affiliates. On the other hand, influencers can expect a steady stream of income. In contrast to a sponsored campaign where they only earn for a limited time, being an affiliate allows them to earn for a lifetime so long as the product keeps selling. 

5 Influencers Who Are Successful Affiliate Marketers

A Business Insider interview revealed that influencers earn anywhere from $50 per month to more than $25 per month from affiliate links alone. Industries can range from finance to skincare, with followers ranging from 2,700 to 1.7 million. 

Here are a few influencers who have built engaged audiences and now run successful affiliate businesses. These influencers’ incomes were validated by Business Insider.

1. Kayla Compton, a nano-influencer in the lifestyle niche with less than 5k followers, makes $350 monthly in affiliate commissions. 
2. Bethany Everett-Ratcliffe, a micro-influencer with 16,000 Instagram followers, earned $500 in one month from affiliate links alone.
3. Charlie Chang, a personal-finance YouTuber with 350,000 subscribers, earned $60,000 affiliate commissions within three months of promoting personal finance apps.
4. Vi Lai, a skincare aficionado, makes $5,000 monthly in affiliate commissions from her 180,000 Instagram followers and 849,000 TikTok followers.
5. Tori Dunlap, a personal finance influencer with 1.7 million TikTok followers, made more than $200,000 in eight months from affiliate marketing only.

Influencers with all sizes of audiences can earn from affiliate marketing. If you are already using the products and these are products that you know would appeal to your audience, then don’t hesitate and reach out to these brands. You’d be surprised how many are willing to work with influencers and share the profits.

6 Examples of Successful Affiliate Marketing Programs

More than 80% of brands use affiliate marketing, and more than 40% of marketers agree that it’s an effective way to attract new customers. Here are some great examples of brands using affiliate marketing to grow their business. 

Canva

Canva is a design platform that lets affiliates earn $36 for every new Canva Pro subscriber. They support their affiliates with an easy-to-use dashboard, simple and timely payments, and priority customer support. 

Canva is a growing platform already used by more than 18 million users worldwide. It helps users create stunning and intuitive designs that they can use for social media posts, website graphics, and even printed materials. Users can do anything from graphic designs to video editing. 

The best affiliates for Canva are influential designers, design educators, and just about anyone with a large audience. The brand’s target is to become a household name in design software. Currently, Canva has more than 8,000 affiliates worldwide, and affiliates can earn as much as $3,000 monthly in commissions.

Get Response

Get Response is an online marketing software solution perfect for small to mid-size businesses who need help running an online marketing strategy. Their free-to-join affiliate program is great for bloggers and influencers specializing in small business advice and digital marketing strategies. 

Get Response has two attractive affiliate programs – a recurring program and a one-time upfront program. Affiliates can decide if they want to earn a recurring 33% commission for every payment made by the referred user or get an upfront $100 for every sign-up. Get Response’s pricing starts at $15.58 per month. 

To help their affiliates earn, Get Response offers free marketing materials like sales copy, videos, and web banners. They also provide detailed referral statistics to help affiliates know how much they’ve earned.

BH Cosmetics

Affiliate marketing works well even for non-digital brands like those in the cosmetics industry. If you’re a beauty influencer, you can sign up for the BH Cosmetics affiliate program and earn a 6% commission from every sale generated through your link. The average order value on their site is $38. 

BH Cosmetics offers vegan and cruelty-free products, making them a popular choice among sustainable-conscious consumers. To help their affiliates, they provide web banners, monthly newsletters, coupons, and other creatives. 

Coursera

More and more people are pursuing continuous education via online learning platforms. Coursera is a great platform that offers more than 4000 courses from various universities and colleges worldwide. They pay 10%-45% commissions for every eligible purchase made using an affiliate’s link. These can be courses purchased by new or existing Coursera users. It can also be multiple courses made by a single user. 

Coursera provides web banners, weekly newsletters, and text links to help affiliates promote the brand. They also provide access to their product merchandiser field where affiliates can see eligible and available courses. 

Shopify

More and more entrepreneurs are creating online stores and joining the e-commerce bandwagon to cater to their customers. This means that platforms like Shopify will continue to be in demand. If you’re an influencer who inspires your audience to pursue their entrepreneurial goals, then you should consider becoming a Shopify Affiliate. 

It’s free to join, however, Shopify has a careful selection process that can take up to 15 days. You need to show a track record of producing original content and an established audience for them to approve your application. 

Shopify pays affiliates an upfront bounty equivalent to 2x the monthly plan price for each successful referral. The user has to be active for two months to be considered successful. Shopify monthly plans start at $29 and can go as high as $2000. 

Tripadvisor

Most brands use a pay-per-sale affiliate model. Tripadvisor is different—they use a pay-per-click model. Affiliates earn a commission from every visitor who lands on the Tripadvisor site then clicks out to one of their hotel booking partners. Even if the user doesn’t complete a booking, the affiliate still earns a commission.

Tripadvisor pays 50% of the commissions they receive from hotel partners to their affiliates. Although, commission rates per click vary depending on the booking partner, the seasonality, and the length of stay. 

For travel influencers, this can be a great affiliate marketing program since there’s no pressure for visitors to complete a sale. It’s also great for beginners since no minimum traffic is required to join the program. 

How Do You Become an Affiliate Merchant?

Many affiliate merchants are large companies looking for additional ways to sell their products. The best-known affiliate merchant is Amazon, which uses its Amazon Associates program to sell products using affiliates as salespeople. This program was so successful that Amazon adapted it when they set up the Amazon Influencer Program in 2017.

However, you don’t have to be a large company like Amazon to become an affiliate merchant. You just need to be somebody with a product to sell. Quite a few small businesses and even solopreneurs create knowledge products that they sell online using affiliate marketers. These people are more likely to work through affiliate networks, so they don’t have to go through the hassle of arranging payment and product delivery (although they may still send online knowledge products themselves).

Many people begin as affiliate marketers, and then decide to increase their incomes by creating products themselves – a genuine case of passive income. Affiliate marketing can be a hard job for marketers, even influencers with sizable audiences. By creating a few products that other affiliates can sell, these people can have a foot in both camps and double their income-earning potential.

If you want to become an affiliate merchant, you need to follow these steps:

1. Have a product idea – you can't become a creator if you haven’t got a product to sell
2. Validate your idea – not all potential products will sell well. Some may sound great as you discuss them having a few beers with your friends, but are not so good in cold reality. Ideas are only useful if somebody wants to buy your product
3. Create your product – you need to make your product. This could mean sitting down and writing your knowledge-based product. Or it could mean finding a manufacturer to produce the first batch of your physical product. Digital products are much easier for individual people or small businesses
4. Either join an affiliate network or find affiliates yourself to sell your product – finally, you need to find the people who will sell your product on your behalf.

Affiliate Marketing Software You Can Try Today

Affiliate Marketing Platforms connect influencers with merchants and help them track their earnings and sales performance. These platforms contain companies from every niche and are an easy way to get your feet wet in affiliate marketing.

While you can always DIY affiliate marketing, if you’re just starting, looking for the right platform is your best and safest bet. By going this route, you prevent fraud and privacy issues. You also minimize the learning curve from trial and error. 

The right affiliate marketing platform should help you keep track of your affiliate commissions, provide insight into your site traffic, and help you optimize your affiliate links. 

It should have the following:

• User-friendly interface that is intuitive and helps you easily access your earnings, your campaigns, and your progress.
• Integration with various SaaS like PayPal, Shopify, and other e-commerce platforms that help you expand the capabilities of your affiliate program
• Real-time tracking and reports that show which campaigns are doing well and which ones need further optimization
• Round-the-clock and accessible customer support who’s ready to answer your queries and provide assistance when needed
• Right price suited for your company needs  

Top 5 Most Recommended Affiliate Marketing Platforms

1. Refersion

Refersion boasts of having 20,000 satisfied clients since it started in 2015. It’s a popular choice among influencers and brands looking for seamless and profitable collaboration. 

With Refersion, affiliates get a personalized dashboard where they can monitor their activity, commissions, and payouts. Brands get access to thousands of affiliates waiting to be discovered or to apply directly to their affiliate program.  

Best of all, the platform is famous for its top-notch customer support and onboarding seminars and training that help both influencers and merchants navigate the world of affiliate marketing.

2. Post Affiliate Pro

Present in more than 100 countries, Post Affiliate Pro is your chance to create a truly global affiliate marketing network. The company has already paid more than $500 million commissions to its over 100 million affiliates. 

It integrates with more than 200 third-party platforms and allows easy customization to fit your brand look. It has five-star customer support, real-time data reporting, and a free 14-day trial.

3. Tapfiliate

Tapfiliate places customer happiness at its core, evidenced by its 93% satisfaction rating. It’s an affiliate platform that promises full brand control, allowing brands to create personalized links and sign-up pages. This is attractive to affiliates who can have custom links.

4. LeadDyno 

LeadDyno has paid over $200 million affiliate commissions in 2020 alone and has tracked more than 81 million referrals. Their platform allows brands to treat affiliates as extensions of their marketing team by keeping them up-to-date with the latest products and company news.

The platform offers real-time commission tracking, one-click integrations to more than 25 e-commerce platforms, recruitment automation, and a customizable payment scheme.

5. Everflow

Everflow is an established affiliate marketing software suited for large companies looking for robust features. Founded in 2016, it has already tracked more than $1.31 billion in revenues and paid $1.1 billion in commissions. 

The platform allows brands to create custom action plans and manage partnerships with influencers, media buyers, and offline placements. Compared to other platforms that start at less than $100 per month, Everflow starts at $750 per month. 

Other affiliate marketing platforms worth mentioning are:

• Affiliatly – perfect for those on a budget
• TUNE – works with mobile, desktop, and apps
• PartnerStack
• iDevAffiliate – a well-experienced platform that has existed for more than 20 years
• FlexOffers
• ShareASale – another well-known platform with over 225,000 active partners worldwide
• CJAffiliate – used by more than 3,800 brands worldwide
• Referral Rock
• Omnistar Affiliate

Final Thoughts

Affiliate marketing has been around since the Internet started. With the advances in digital marketing, it has become better, more sophisticated, and more accessible. Influencers and product creators can experience a win-win scenario by using affiliate marketing. 

For influencers, affiliate marketing is another way to monetize the following they’ve spent countless hours building. It’s also a way to further cement their credibility and expertise since they can offer products that will improve the lives of their audience. With affiliate marketing, influencers can experience a sustainable and truly passive income that can earn them recurring revenues. 

For product creators, be it solopreneurs or large organizations, affiliate marketing is an exciting avenue to gain new customers without a lot of overhead costs. By working with affiliates, they can massively advertise their products to targeted audiences who are more likely to buy. Their brands also gain better credibility since perceived experts are the ones marketing them.

While there are issues of fraud, theft, and misrepresentation in affiliate marketing, the benefits far outweigh the risks. Every brand should consider affiliate marketing part of their digital marketing arsenal, and every influencer should endeavor to become an affiliate of the products they patronize.

About the Author

Djanan Kasumovic

Writer

Djanan Kasumovic, a dynamic force in digital marketing, leads as the Head of Growth at Influencer Marketing Hub. His distinguished career includes roles at high-profile companies like SnappCar, a leader in European car sharing, Travelbird, Kids Luxury Group and B&S. Djanan has been at the forefront of innovative digital marketing processes, mastering areas such as AI content production, AI marketing, and AI influencer marketing, establishing himself as a pioneer in these fields.