How Does Affiliate Marketing Work?
If you’ve been selling affiliate products for a while now, then you probably think you have a fairly good handle on how the process works. It’s all quite simple: you get given a link, you promote a product using a said link, and you then get a commission on all the sales that come from that URL.
But do you know how this all works? Do you know how the product creators know the link came from you? And do you know how to protect your links? Let’s take a closer look at the nuts and bolts.
Cookies and Referrers
What’s happening when someone clicks on an affiliate link is that a cookie is being left on their computer. This then means that when they go to buy the product, they can be identified as having been sent by you.
This is why some affiliate schemes can still pay-out even if someone clicks on your link, goes away, and then comes back later to buy the product.
Whether or not that will happen for you though will all depend on how long the cookie lasts – most have an ‘expiry date’. Likewise, it’s worth bearing in mind that someone could click on a second affiliate and then get a new cookie from another marketer. Whether or not this replaces your cookie will depend on the system being used: whether it’s ‘the first click’, ‘last click’, or ‘lifetime referrer’.
Meanwhile, some potential buyers might try and sidestep your affiliate link altogether and go directly to the website to buy the product. This is called ‘link bypassing’ and it’s the reason that smart affiliates will use another strategy called ‘link cloaking’ to protect their earnings. This essentially means using a referral to disguise the link, though there are numerous ways you can achieve this. Something to think about!
Many people never question how things like affiliate links work, but by understanding the basics, it’s possible to make sure that you do everything right and maximize your earnings. Likewise, you should also think about the legal aspects of affiliate marketing. For example, the fact that you are using cookies means that you need to show a disclaimer to comply with EU laws. Likewise, it is law in the US that you must announce that you are earning a commission. You can do this easily with a plugin showing a small message at the bottom of the page, and likewise, there are plugins to help you become automatically compliant with EU GDPR laws.
Marketing for More Sales and Profit
As an affiliate marketer, it’s going to become clear that the saying, “always be marketing” applies to you in a big way. For the word to get out about the solutions you are marketing, you have to tell people and promote. Thankfully there are numerous ways that you can promote your affiliate business that is not expensive, and some are even free other than the time it takes to do them.
Remember that you may have different aspects of your business to market too. You will need to market your affiliate program to those who might want to make money. You will need to market the products you create or find to those who need them. Therefore, it’s a business to business and business to customer situation, and they should be marketed separately from one another.
You can market both in the same way, but the material will look different based on the audience and the product you’re promoting. The primary way to market your business is via content marketing.
This type of marketing includes any kind of marketing you are doing with content – including social media marketing, blogging, and email marketing. Create a plan for every single product that you want to promote. Know who you’re creating the content for, where it will appear, and what the call to action should be.
Search Engine Optimization
Learn what you can about SEO because it’s essential for your success. It will help you create better headlines, better subject lines, and indeed much better content that is targeted correctly. Remember that SEO includes both on-page and off-page options – from internal link building to get links to your work, and all should be considered. Adding software like Yoast SEO to your blog can help a lot.
The most successful affiliate marketers use paid marketing in addition to the free choices. Remember that there isn’t any free choice, though. You’ll either use your own time or your own money. Which you choose depends on the priorities you have and the skills you possess.
Social Media Marketing
Develop each platform that you use so that it shows your brand voice and the image you want to project on the world. Use the content you create to get the word out to the masses regularly – using both free and paid options.
Email marketing is part of content marketing, but it needs to be stressed that email marketing is not something you can skip if you want to be a successful affiliate marketer long term. Building your list based on your target audience is what’s going to keep you in business, even as your ideal audience grows and changes with time and social media platforms die out.
We already talked about starting your affiliate program to sell the products that you create based on what your audience needs. This is an excellent way to generate buzz and get the word out faster about any product you produce. Once you have your products, start bringing on affiliates. Start with your happiest customers and train them to be effective money-generating affiliates.
Joint Venture Partnerships
One way to market your business is to form partnerships with others who serve the same audience as you do with complementary products and services. By the way, these are also opportunities for you to promote their products as an affiliate and vice versa.
The way a JV works is that you agree to work together for a common cause on a temporary or long-term basis while remaining separate business for everything but the
Joint project. For example, you might get together with a bunch of your friends with affiliate programs, who offer programs to working moms of school-age kids such as meal planning, household organization, self-improvement, and more.
You can put on a webinar with a few different experts in this area, each offering their product or service to the audience. Everyone markets the event together at the same time to create buzz. Then you host the webinar live, and you can even replay it as live to generate even more leads.
The only way to make more sales and profit is to market more. Get more people involved and ensure that as many people as possible are talking about your products and services. Don’t be afraid to aggressively tell your audience about your offers. After all, you know they work, and you are proud of them. Why wouldn’t you tell people about them as much as you can?
How Big Sites and Brands Use Affiliate Marketing
A lot of internet marketers will make money online by selling digital products such as eBooks and courses through affiliate platforms like JVZoo. These sites let them find products with zero overheads, and no storage or delivery costs. They then allow them to select those products, and to sell them to buyers for a huge cut of the profits.
In many ways, this is the perfect business model for those that want to get set up quickly, who don’t have a lot of money to invest, and who don’t want to deal with complex admin like fulfillment.
But if you take a look at any truly large brands – whether that’s Bodybuilding.com, Mashable, The Verge, and Wired – you’ll see that they don’t use this business model.
This is not to say that they don’t make money from affiliate sales! They just go about it differently. Here’s how, why, and what you should learn from them.
What the Big Brands Are Selling
Big brands don’t typically sell third-party ebooks. Why? Firstly, ebooks have a limited appeal: they only tend to appeal to those that are tech-savvy, in a certain age bracket, and also fans of reading. Conversely, physical products appeal to everyone.
The other reason is that – let’s face it – a lot of ebooks are bad value. Paying $30 for a PDF is a rather big ask when the PDF is only 10 pages long and full of typos! Especially when the ebook is free to make and produce.
Potentially, this could hurt the brand of the big site and prevent them from making future sales.
So instead, most big brands sell real products, and they sell services.
To do this, they use sites like Amazon, Best Buys, and like EDx (a site that lists online courses – including those from top universities).
Imagine what commission a site like The Verge might make selling an MBA! (Which typically cost thousands of $ per year!)
How to do it
So how do you set yourself up with this kind of business model?
First, you need to track down and sign up for those higher-calibre affiliate accounts. You can sign up for Amazon easily, but to land something like EDx you will need to apply (which means having a big enough site).
Next, use a tool like Genius Links or Trackonomics to manage affiliate accounts across lots of platforms and quickly generate and track those links.
Finding Your Niche
The very first thing you need to do if you want to make money as an affiliate marketer – whether you’re going to make money selling other people’s products or your own (best to do both) – is that you need to figure out who you want to work with and what niche you want to be part of.
Who Do You Want to Work With?
One way to figure out the type of people you’d like to work with or help is to look inside yourself to find your interests and passions. If you enjoy being around certain people and you know about their hopes, desires, and needs due to being part of that audience yourself, that’s one way to do it as you will already have insight.
However, don’t let this give you an excuse not to do your research. Your experiences, even as part of your niche audience, are subjective and real results may be very different than you imagine. Try describing your ideal customer in one or two sentences to help you move forward.
Who Serves That Audience Now?
Once you have identified a potential niche audience, it always helps to look at the competition. After all, if this niche has no competition, is it a profitable niche? Some people will say that you should go for the low competition niches, but it’s better to go for the niche that offers enough potential customers for you to reach your income goals if your conversion rate matches industry standards.
For example, if there are 1000 potential customers, and according to your research there is a 4 to 7 percent conversion rate, and you know that you can get your materials and information in front of those 1000 customers, you may get at most 70 customers from a campaign. Is your price point high enough for those 70 customers to make you profitable?
What Skills and Solutions Can You Offer This Niche?
Do you have specialized education, experience, or knowledge that makes you particularly suited for this niche? You don’t have to be part of the audience to do well in a niche.
For example, if you have identified a niche that needs someone to advise them on products to use for their love of camping that is different from what’s out there, you can still learn about it and serve the audience even if you have no camping experience or appreciation of camping. Maybe instead of direct experience, you have resources that enable you to pay people with subject matter expertise to create your business.
What Makes You Different?
Always look at yourself too. What makes you different from your competition? What skills can you offer to this niche that others can’t? How can you stand out from the crowd? Are you going to approach the niche in a different way than the others? For example, if you’re a business coach, are you buttoned up or a free spirit? Whatever you are, you’re going to attract an entirely different segment of your audience base than someone different from you.
Check an Affiliate Network for Products That Serve That Audience
The other thing you want to do is ensure that any niche you choose is profitable. Asking yourself if it’s profitable is an important question. Just because you have internet and passion doesn’t make it a profitable niche. What makes it profitable is that the target audience exists in enough quantity and has enough money to buy the solutions you create and offer.
Once you narrow down some options, the primary considerations are whether your niche idea is profitable or not, and whether you have the skills to proceed or not – either skills you learn or skills you buy from others. Choose a niche that you like that can provide enough profit and that you know how to serve.
Creating a Digital Product vs Affiliate Marketing
If you want to make money as a marketer, then you have two main options. One is to create a product and to sell that. The other is to sell an affiliate product.
Neither of these is the ‘right’ option. The right option will instead depend on what niche you’re in, what you enjoy doing, what you’re capable of doing, and more.
So, let’s take a look at the pros and cons of each.
With a digital product, you of course have the advantage of keeping 100% of the profit. You also have the freedom and control to market your product however you like and even to edit it and alter it if you so wish. This also makes it easier for you to create a strong brand – if someone has enjoyed one of your products, there’s a good chance they’ll be interested in buying more from you in the future.
But then of course that means you’ll also need to create that product. This in turn means you need to invest a lot of time and effort – or money if you plan on outsourcing – into the creation of that offering.
And what that means is that you can potentially end up out of pocket. If you invest lots of time and money into a product that then ends up not selling, you’ll have lost money. There are ways you can ‘validate’ a product to ensure there’s an audience for it, but ultimately you will always be taking a gamble.
On the other hand, if you choose an affiliate product that is already making lots of sales, then you’ll know for sure that it can sell. All that’s left is finding the right audience. In some cases, even the marketing materials will be prepared for you.
In terms of profit, affiliate products still offer very high commission – up to 75% in some cases. If you pick a more expensive item then or sell multiple items, you can make just as much money as you can from having your product.
There’s no right answer then but remember: you don’t have to choose. Why not start with an affiliate product and use that to fund a digital product of your own?
Or better yet, why not use affiliate products to learn what works and what doesn’t, and then use that to help design the perfect product of your own!
(And of course, you should also look into PLR products!)
Creating Your Products or Services
Another way to make a profit as an affiliate marketer is to start creating your products and/or services to promote to your audience too. As you work with your audience and gain customers due to the products you promote and the content you publish, you may gain insight into the audience that gives you the idea to create a brand-new product for them. Your product can be free or for a fee, depending on how you’re going to use it.
One way that you can add your products to the mix is by offering a bonus for the purchase of a different product for which you are an affiliate. The bonus product offers you the ability to add them to your list, boost your revenue, and perhaps demonstrate more of what you can do for the audience regarding their problems.
Some affiliate systems enable you to add your bonus product right to their funnel on the affiliate platform (such as is offered via aMember.com or JVZoo.com) if the product creator activates that ability for you. In other cases, you may have to get creative and send the bonus another way. However, there is a lot of technology that will do it automatically for you too.
Building Your List
As an affiliate marketer, you can create products that are only for list-building purposes. A good example might be a checklist to help your audience choose the right affiliate marketing software or help them set up their first webinar. Anything that your audience needs and wants that is simple to create makes a handy list builder.
Another Income Stream
Additionally, as a product creator, you can create products as a separate income stream over and above your income generation as an affiliate. Maybe you can make a better cleaning organization calendar than the one that you’ve been promoting. Perhaps you have written a course about keeping your home organized that you want to market. Once you create the product, you also can recruit affiliates to make the sales for you.
As a product creator, you’ll need to ensure that you have the right software like aMember.com that helps you set up a shopping cart and even a membership site that enables you to distribute your digital products and services to your audience. You can also use any number of affiliate networks mentioned to list your products and attract affiliates to boost your income.
How to Become a Thought Leader/Influencer to Sell More Affiliate Products
Selling affiliate products is a business model that appeals very much to people who want to start earning money as easily and quickly as possible. That’s because affiliate marketing allows you to begin earning money immediately: you don’t need to build a product, or to spend a lot of money allowing someone else to build it. This also means that you don’t need to take any risks.
But herein also lies the problem. Because affiliate marketing naturally appeals to those looking for quick fixes, it means that very often, they will attempt to take the fastest route to the point where they start making money. The problem? The fastest route is not always the best. And by taking “shortcuts,” you can risk missing the highest earnings.
The Two Options
There are two ways you can earn money from affiliate products. One is to rush to find a product, then quickly create a sales page (a single web page that is dedicated to selling that item), and then send people to that page through advertising.
The other method is to spend time building up an audience first. To build an audience that trusts you and listens to what you have to say, to which you can then market a product to. This way, you are flipping the formula on the head: gaining an audience then finding a product to match, rather than the other way around.
Let me tell you this: the latter option is by far the superior strategy. Why? Because when you build an audience that trusts you, and that wants to hear from you, you have a direct route to an audience that is qualified and perfectly targeted. This can be the difference between launching to 500 orders on day one, versus working hard to gain a slow trickle.
When someone trusts you, they will trust your recommendation. And when you already have an audience of thousands, it’s FAR easier to get the word out.
How to Get There
So how do you get to this point? It’s a challenge that many marketers struggle with, but the key is to play the long game. That means spending time delivering amazing value and high-quality content and using this to slowly build up momentum. You must have something new to say in your niche, and you must choose a topic that you are passionate about. That will resonate with your audience, and as a result, they will hang on to your every word.
Finding the Right Affiliates (and Ones to Avoid)
Once you create your products for sale, it’s time to set up an affiliate program of your own so that you can maximize your reach. Having your affiliate program is like having an army of salespeople on your site building your business every single day. But finding the right affiliates takes a little thought and consideration.
Quality not Quantity
Having 1000 affiliates will not help you if they are not good salespeople. If the people who want to promote your product use unscrupulous means to make sales, which can also affect you very badly. By focusing on recruiting quality affiliates over a lot of affiliates, you can avoid most of the problems that can come with affiliates – namely fraud and spam.
Check out any applicants’ websites. Do they have an active blog? Does the content fit your audience? Is the website secure? Are they following all the pertinent laws for their country and yours regarding spam, privacy, and other issues? Do they appear honest and confident based on the information you find on the website?
Their Domain Name
One way to find out about the person behind the website is to do a “Who Is” search. Some of the websites are going to have the information hidden. If that happens, do a little more digging to ensure that the people behind the site are honest people that you’d want to deal with in person.
Their Content and Information
When you go to the site and read the content and information, does it speak to your audience such that they will choose to buy from them? What sort of keywords do they use? Are the content and information directly and above the board? Would you feel safe sending your mother to that site to get information?
The other thing you will want to do when you get an affiliate is to ensure that they fill out all the right legal forms required. Even if you are not going to send out 1099s because you pay via a third party like PayPal, getting that information is still important because it establishes their legality and validates them in a way that helps you keep your customers safe. Additionally, have they proven themselves to be effective affiliate marketers?
When you are first starting as a product seller, you may not be able to be too picky about who becomes affiliates, but at the very least ensure that they are who they say they are, that they are not criminals and that they serve their customers honestly and transparently. Just realize that if you choose people who are new to affiliate marketing, you need to offer training and encouragement to them so that they make more sales.
Helpful Technology for Affiliate Marketers
Once you have chosen to become an affiliate marketer, there are tools and technology that will make your job easier. The technology that is available today includes website building tools, email marketing tools, market research tools, and more.
To build a highly converting website, you need to choose the right type of domain name, hosting, website builder, and landing page automation so that you can get more done with less work and worry. The following tools will help you get it all done.
One of the first things you need to do to get started with your affiliate marketing profits is to buy a domain name so that you can build a website that attracts your ideal audience. Choose a name that includes a keyword, that’s short and easy to remember, and that uses a dot com extension. An excellent choice for buying domains inexpensively is Namecheap.com.
The next thing you’re going to need after you buy your domain name is website hosting. You might want to check with the host before you buy your domain, as sometimes they offer a deal where you get the domain free by paying upfront for hosting. A good website host offers at least 99 percent uptime, good customer service, and an easy-to-navigate website. A good choice, especially if you’re a newbie and don’t understand what you’re doing, is MomWebs.com. They have great customer care and service.
You also need to build or have a good affiliate website built. One of the best and most used choices for this is self-hosted WordPress. You can learn more about it at WordPress.org. (Note: This is not the same as WordPress.com, although that dot com is run using self-hosted WordPress.) This builder is easy to use, inexpensive, or even free, and what is most important is that it works great and search engines still love WordPress.
Landing Page Builder
Once you get everything done, you’re going to need some form of landing page builder. Now, you can do this for free using self-hosted WordPress just by making a new page, but it won’t have as much automation on it.
One thing that can help you earn more money is automation so that you don’t have to do everything manually. A good choice for automated landing page software is Instapage.com. If you use a robust system like Infusionsoft.com for your marketing, you already have it included. This type of software will automate your funnels in a way that will seem to turn your site into an ATM some days.
Email marketing is not something you can skip out on. It’s one of the most effective and valuable forms of marketing that exist today. Even social media marketing cannot match the power of email marketing. This means you’re going to need to both capture leads and send out emails automatically.
As an affiliate marketer, you’re going to have to do a lot of market research to ensure your efforts do not go wasted. If you don’t do the research, you’ll take a lot of action that is not going to produce results. Don’t make assumptions; do the research. You can research your competitors using software like iSpionage.com, and you can research trending topics using something like Google Trends.
Investing in tools to help with traffic generation is also a meaningful way to create a successful affiliate marketing business. After all, you need a lot of targeted traffic to get the results you wanted when you set your goals and objectives.
Tracking and Converting
The other tools you need to help you become a profitable affiliate marketer are tools that help you track the effectiveness of your efforts and convert your audience. Every website needs to install Google Analytics. It’s free and it works great. After all, Google is still the leading search engine. That means you need to follow their recommendations.
One of the ways you’re going to generate more traffic for your ideal target audience is to publish content that they’ll be interested in. To produce compelling content, you’ll need to do your research, ensure it’s understandable, and that it’s attractive. Not only that – you also want to ensure that you are posting content on a consistent and regular basis. These tools can help you accomplish that.
How to Prevent Link Hijacking
Affiliate marketing offers a very powerful way for anyone to make money online. What makes this simple business model so powerful is the fact that the marketer doesn’t need to create or acquire a product or service of their own. All they need to do is to find one that they like the looks of and then promote that. Seeing as some affiliate programs offer as much as 70% or more commission, that can potentially be just as lucrative as developing something from scratch but with none of the risk, none of the overhead, and none of the barrier to entry.
But that’s not to say that you can sleepwalk your way to success this way. You still need to be vigilant and many people will overlook the smaller details that are so crucial for this to work.
For example, what are you doing right now to protect your affiliate links? What can you do to prevent people from simply using the URL to buy products without you getting the commission you deserve? And what about those that would use the link to create their affiliate link and profit instead of you??
Here are three easy things you can – and should – do right away!
Use a Redirect
One of the simplest and easiest ways is to use a redirect. This might mean setting up a web page that acts as an ‘intermediate’ page and then simply sends the visitors onward to the product or offer. That way, you can ensure that the cookies are stored on the user’s computer but they won’t be able to spy on the destination URL without clicking.
You can take redirecting one step further by making sure that the user never even sees the address of the destination site. You do this by using URL masking which is also known as ‘stealth redirection’. Although the user is redirected, the URL will never change!
Use a ‘Pretty Link’
A pretty link is a link that is shortened to be more attractive and shorter while of course also hiding the original URL. This works just the same as a redirect, except that you’ll be using a ready-made service like Tiny URL or Google’s link shortener.
Either way, this also harder to peak at and is also more accepted. Many people use TinyURL even for non-affiliate links, so this is a good way to fly under the radar!
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As you probably already know, one of the fastest and easiest ways to make money online is in affiliate marketing.
As an affiliate, you don’t have to worry about creating products, providing support, or testing and tweaking sales pages endlessly in order to increase conversion rates, and ultimately, profits.
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- According to Statista, affiliate marketing spending in the U.S. alone is expected to reach $8.2 billion by 2022, more than triple what it was 10 years earlier
- 81% of advertisers and 84% of publishers in the U.S. have turned to affiliate marketing
- Largest affiliate networks have 100K+ active affiliates
- Content and blogs generate almost 40% of affiliate publisher commissions in the U.S.
- 71% of affiliate publishers in the U.S. work with 3 or more networks
- 35% of affiliates make at least $20K in annual revenue from their affiliate marketing efforts
- 50% of affiliate-referred traffic comes from mobile devices.
- 74% of US online shoppers check multiple affiliate websites before deciding on a purchase
- 73% of the merchants reported that their affiliate revenue met their needs
By looking at these affiliate marketing statistics, you would definitely know the power of affiliate marketing.
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