The Basics of Affiliate Marketing Unwrapped

“Affiliate marketing is a marketing practice in which a business rewards one or more affiliates for each visitor or customer brought about by the affiliate’s own marketing efforts.” – Wikipedia

This basically means that if you, an affiliate of the company, bring the company a paying customer, they will share the proceeds of that sale with you at a prearranged amount.

Affiliate marketing is most prevalent on the web, and affiliate marketers play a significant role in many company’s online marketing strategies.

How affiliate marketing works

Affiliate marketing works by an arrangement or contract between a person (or company) and a business selling products and services.

The arrangement outlines how much the affiliate will receive on bringing a successful sale to the business.

Once an affiliate introduces a customer to the business and they make a successful sale, the affiliate is given their commission.

Usually, in online scenarios, this commission will build up in the affiliate’s account with the business and they will receive a payout at the start of the next month for the previous month’s efforts. Sometimes there is a minimum payout level which the affiliate must earn before funds are given out.

basics of affiliate marketing

How affiliate marketers help businesses

Affiliate marketers help business because having an affiliate marketing for you is like paying a commission only sales person.

Online, this could potentially mean hundreds or thousands of online salespeople reaching potential customers that would cost you much more than if you were to try to contact them yourself.

It’s this benefit that makes it worth it for the business to pay a percentage of the sale to the affiliate. It’s really a win-win.

The nuts and bolts of how affiliate programs work

Affiliate programs are schemes set up by businesses to have people help them promote their products and services by providing a revenue split with the affiliate when they bring a customer to the business that buys something.

Affiliate programs work by sending a predetermined percentage of the proceeds of any sales to the affiliate when the customer buys something from them.

The company installs a tracking system that records where their visitors come from, this is usually done by providing the affiliate a special code to apply to their links.

When the customer clicks on the affiliate’s link the code is activated in the tracking system to record where the customer came from. If the customer then goes on to complete a purchase, the affiliate is credited with providing the sale and shares in the revenue.

Basics of affiliate marketing to get right

The basic things you need to get right include:

  • How to present your links to be clicked
  • What wording your have around your links to show that you endorse the product/service on the other end
  • Tracking your marketing efforts using appropriate software
  • Ensuring you have filled all your legal obligations for disclosing the nature of your recommendation

The next step is to get as many people to view your links as possible and try to get them to click through so you have a chance of earning a commission.

Click here to learn more about what is affiliate marketing.

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