In some ways asking how much money affiliates earn is analogous to asking how long a piece of string is. This is because there are so many variables that can affect an individual affiliate's earnings. However, we can help you with our free Affiliate Marketing Income Estimator to give you a guide to your potential affiliate earnings.
Note that you will need to have an existing affiliate website and know your site visitors for these numbers to be particularly meaningful. This is because our tool needs figures for your click-through rate (CTR) and conversion rate (CR). While you can estimate these figures, you will get much better results if you input your actual data figures.
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How Much Money Do Affiliates Make?:
- Some Affiliates Make 6-Figure Incomes, But Many Clear No Money
- Categorizing Affiliate Marketers by Earnings
- How Do You Earn Affiliate Income?
- Look at Your Bottom Line
- Where You May Find Native Advertising Beneficial to Your Bottom Line
- Affiliate Commissions Vary Greatly by Product Type
- Tips to Increase Your Affiliate Income
Some Affiliates Make 6-Figure Incomes, But Many Clear No Money
Affiliate marketing is like many sources of online income. Some people will have persistence and patience to make it to the top and earn extremely healthy incomes from promoting affiliate products. Many people, however, will start affiliate marketing with full enthusiasm but rapidly become disillusioned when they fail to see much, if any, money coming into their bank accounts. As a result, they will write off their affiliate marketing as a bad experience and move on to the "next big thing" they believe will make them overnight millionaires online.
Pat Flynn is renowned for his success with affiliate marketing. Indeed, he's earned more than $3 million in affiliate income to date. He describes how he made $300K from one project in this video:
Most affiliates begin slowly earning affiliate income. Indeed, it may take some time before you make enough to meet a minimum payment threshold. For instance, you must earn $US100 (or approximately the equivalent in another currency) to receive a payout from Amazon Associates. Unfortunately, this is what discourages many beginning affiliate marketers. They work hard creating a website and writing articles or making videos promoting affiliate products, only to receive nothing at the end of the month.
But persistence pays off. If you can get over the hiccup of reaching your first minimum payment threshold, it becomes much easier to visualize earning better affiliate income, giving you the incentive to continue.
As we wrote in How to Make Passive Monthly Income with Affiliate Marketing, "the key to success with affiliate marketing is having an online 'home' where you can recommend products, whether a blog, specialist website, YouTube channel, podcast, or a sizable social media audience. If you don't already have a reasonable number of followers, you should first spend your time establishing yourself online before you attempt to sell affiliate products." The most important traits needed for successful affiliate marketing are patience and perseverance.
Categorizing Affiliate Marketers by Earnings
Niall Roche of Authority Hacker splits affiliate marketers into four categories:
- Beginner – $0 to $1000/per month
- Intermediate $1000 to $10,000/per month
- Advanced – 10k to $100k/per month
- Super Affiliate – $100k+/per month
If you are a beginner affiliate marketer, you might consider $100k per month an impossible dream. But people do make that much. Just ask Pat Flynn. He is also an example of how you can start making good money relatively quickly if you have a pre-existing audience. Flynn had already created an audience for his website by writing and selling an eBook that helped people pass an exam in the architecture industry. This meant that he already had some eyes on his posts when he started promoting affiliate products a little later. If you're a total beginner, you will first need to allow for lead time to build an interest in your site before you can expect to make affiliate sales.
In a survey we conducted for our Affiliate Marketing Benchmark Report 2022 we discovered that 3.78% of our survey respondents made more than $150,000 annual affiliate income, 7.94% $100,000 - $150,000, 5.15% $50,000 - $100,000, 16.21% $10,000 - $50,000, and 57.55% below $10,000. Although most clearly come into the bottom category and are still Beginners according to the Authority Hacker classifications, there are enough successful affiliate marketers to give hope to those not yet marking their mark.
How Do You Earn Affiliate Income?
The most common way to earn affiliate income is to create a website and engage in content marketing to an interested audience. The more suitable people you can encourage to view your content, the higher the likelihood that they will follow your affiliate link and ultimately purchase the products. When they buy the products you promote, you receive an agreed percentage of their spending as commission.
Therefore, successful affiliate marketing is all about quality traffic. The more relevant people you can reach with your content, the better the outcome.
Some affiliate marketers go one step further and use native advertising to reach suitable audiences. Taboola describes native advertising as "creating ads that are so cohesive with the page content, assimilated into the design, and consistent with the platform behavior that the viewer feels the ad belongs there." Common types of native ads are promoted search results and sponsored social media posts.
Look at Your Bottom Line
As any accountant will tell you, there can be a vast difference between revenue and profit. Just because you receive $150,000 revenue doesn't mean that you are better off if you spend S160,000 to earn it. It is far better to look at your Net Profit, i.e., your revenue less your expenses.
One advantage of affiliate marketing is that you won't have to pay any product development, manufacturing, purchasing, or warehousing costs. However, you will generally have to pay to develop a website (although you may do much of the work yourself) and then pay for domain hosting. However, your most significant expense if you want to make high levels of revenue will most likely be for native ads or paying influencers if you choose to take that promotional path.
With patience, however, you may be able to minimize paying too much for online advertising. With content marketing, you can gradually build up an organic audience and establish yourself as an expert in your niche. In time, you could even become a go-to influencer. Gradually establishing your expertise and building an audience can give you an enthusiastic audience happy to buy the products you are promoting, ensuring there is a synergy between the audience interested in your content and those products.
You will have a few up-front costs establishing an authority site, but once you have your site up and online, you won't have many expenses unless you choose to speed up the process with increased advertising.
Where You May Find Native Advertising Beneficial to Your Bottom Line
If you have the necessary up-front funds, there are cases where buying native ads can significantly benefit your affiliate marketing. Some of the advantages of supplementing your content marketing with native advertising include:
- You can use paid ads to boost traffic to your website. For example, if you write a new blog post, you could pay to promote it on Facebook (or whichever social platforms best attract your target audience)
- You can use native advertising to reach the target audience in your niche at scale. Over time, as you become better known, you might reach a sizable audience of relevant people with your organic content marketing. However, in the early days, you might begin to wonder if anybody is viewing/watching/listening to your content. With native ads, you can reach people who previously would never have heard of you. And if they like what they see, they may well subscribe, meaning that you can continue to reach them in the future
- Be selective where you place your native ads. You can place native ads for your content wherever you believe your target audience may be. But, of course, the better the placement, the higher the price, so you will need to balance the cost of these ads against the expected additional affiliate income they will hopefully generate.
Affiliate Commissions Vary Greatly by Product Type
Most successful affiliate marketers, particularly those who follow the content marketing path, limit the products they promote to those that will appeal to one particular audience. They select a niche where they can create content, for example, blog posts, videos, podcasts, and creative social posts. Then, they develop a website and gradually establish expertise in that niche (even if they have zero prior knowledge and have to learn as they progress). Here, the audience is paramount, and there is little point in promoting products that won't interest them. Too many (unsuccessful) affiliate marketers have tried to continually add new products to their range that have no connection with each other. For example, if you've got readers loving your gardening posts, they are unlikely to want to buy a new television or sign up for a course on improving their archery skills. However, they may be interested in purchasing those new seed varieties you talk about in your posts or using those stakes you use to tie up your tomato plants in your YouTube videos.
Deciding which niche to specialize in can be challenging. However, it is vital that you take time to get this right, as changing direction means you effectively have to start again. As you research different niches, you will probably notice a significant variation in the commission rates offered. And often, the effort it takes you to convert sales of products with a high commission is no more significant than it is to promote low-commission products.
You may even notice a sizable difference in affiliate commission within a single company. Amazon is no longer as lucrative for affiliate sales as it once was, thanks to a decrease in commissions in 2020. Still, even now, there is a noticeable difference between product types. For example, according to Amazon's commission schedule, you can earn 20% on Amazon games and 10% on luxury beauty. You receive 3-5% on most other products, but you receive a mere 1% commission on sales of health and personal care products, groceries, video game consoles, and physical media. You're never going to get rich by promoting PS5s and Xbox Series Xs on Amazon.
Tips to Increase Your Affiliate Income
We have selected a few tips that we believe give you the best opportunities to increase the money you make from affiliate marketing.
1. Select An Audience You Think You Can Work with and the Pick Suitable Affiliate Products to Promote
As we have discussed in this post, the key to successful affiliate marketing is building a sizable audience of interested people who will be interested in affiliate products you may promote. Often, it's easier to start by deciding on your audience than beginning with a product in mind.
Unless you are willing to spend a considerable amount on paid advertising, you will have to build an authority site that will interest these people. So, it makes sense to work with the type of people you feel you can reach and who you feel comfortable communicating with.
Once you have an audience, search for high-converting affiliate products that will interest them, preferably those paying reasonable commission rates. Don't mix and match unrelated affiliate products likely to appeal to different audiences. If you really must promote vastly different products, you should consider creating other sites and keep all your marketing for them separate. This will, of course, considerably increase your workload.
2. Create an Authority Website in Your Niche
Most affiliate marketers create a website to promote their affiliate products. This gives them a place to develop high-quality, authoritative content, where they can build a reputation as an expert in their niche. People aren't interested in any attempts to hard sell online. You have to gain their trust by providing helpful information. They actively want to learn more about products and services to make their mind up about whether they should spend their hard-earned money on them. It is your job to provide them with this information.
If you don't want to create a website, you have some alternatives, such as creating a YouTube channel. You will still, of course, have to produce high-quality, informative videos on topics that will interest your channel's followers and subscribers if you select that option.
3. Use SEO to Give Your Content the Best Chance of Appearing in the Search Engine Listings
If you want to increase the number of visitors to your website (or YouTube channel), you need to follow the best practices of search engine optimization (SEO). We have written the Ultimate Guide to SEO Copywriting that can help you ensure that you structure your site's content effectively. Effective SEO is vital, with one report suggesting that SEO can drive 1000% more traffic than organic social media. If you prefer to use YouTube for your affiliate marketing, we have also written a YouTube SEO Guide.
4. Be Prepared to Experiment
Above all else, however, be prepared to experiment. Don't just assume that you can increase the money you make from affiliate marketing by following some magical path. Just because something works for somebody like Pat Flynn doesn't mean that you can expect the same results.
If you're prepared to try new things and take note of the desires and wishes of your target audience, you can definitely make a healthy passive income from affiliate marketing. You may even reach the exalted level of Super Affiliate in time.
