Home » What is Affiliate Marketing? How does it Work?

What is Affiliate Marketing? How does it Work?

What is affiliate marketing? You must have heard the term on social media or your friends talking about it. Most people don’t know how it works, they just know that affiliate marketing offers great money-making opportunities. In basic words, affiliate marketing is a type of advertisement model where a company pays a commission to third-party advertisers who bring in traffic and leads for the company.

Basically, advertisers pick a product or service from a brand and they get a commission every time they sell the product or bring in leads for the brand. More and more people today are using the internet and brands can generate more sales and affiliate marketers can make money. Bloggers and website owners can start promoting products and services on their websites and open the doors to unlimited income potential.

Affiliate Marketing: How it Works?

Before you try to learn how you can make money from affiliate marketing, you should know the internal working of affiliate marketing. Every affiliate marketing program has 3 parties:

  • Seller and manufacturers
  • Affiliate advisor or advertiser
  • Consumer

1. Seller and Manufacturers

A seller is someone who sells a product. They can be an enterprise, a vendor, or a product creator who wants to sell a product. The product can be of any kind, be it a household item, or machinery or it can also be software.

A seller or manufacturer is the first-ever part of the affiliate program. Without a product to sell, an advertiser can’t promote the product and a consumer can’t buy a product. Even if affiliate marketing doesn’t provide instant sales for the seller, it will help in promoting the products. If a customer is interested in your product, chances are most of the time they’ll end up buying the product in near future.

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With affiliate marketing, businesses can promote products and services without having to spend humungous amounts on paid ads.

2. Affiliate Advertiser/Marketer

The second party in the affiliate program is the marketer. Similar to a seller, an affiliate advertiser can be an individual or an organization that can help a product by advertising it. In simple terms, an affiliate marketer is someone who promotes a product and service of their own choosing. The promotion can be done using social media, blogs, and articles, paid ads, YouTube videos, and so on. The main aim of the promotion is to sell the products.

Affiliate marketers tend to only target one particular audience. Most of this audience is chosen on what they like and what you’re trying to sell.

3. Consumer

According to a report, more than 15% of all online sales are the result of affiliate marketing. If you ask customers, most of them don’t even realize that they made a sale influenced by an article or social media post. Affiliate marketers use several platforms to promote the products they want to sell such as social media, blogs, websites, and videos.

When consumers buy a product influenced by affiliate marketing, the other 2 parties enjoy the benefits. Some affiliate marketers even push the boundaries by telling the consumers that they’ll make money from the sale of a product or service.

Types of Affiliate Marketing

There are mainly three types of affiliate marketing, and all of them are good for different people. Here’s a breakdown of types of affiliate marketing:

1. Unattached Affiliate Marketing

Unattached affiliate marketing is an advertisement type where the affiliate marketer has no direct connection with the product or service they’re selling. These types of marketers have no related skill or expertise nor do they make claims about the use of the product. Because affiliate marketers have no connection with the product, they don’t have to take any responsibility for the product and services.

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2. Related Affiliate Marketing

Related affiliate marketing is completely the opposite of unattached affiliate marketing. Affiliate marketers who promote products and services are directly related to them. Usually, the connection is between an affiliate’s niche and the product or service. These types of affiliates have enough influence and expertise to generate traffic. Plus as they are a trusted source, people prefer to buy products that they promote.

3. Involved in Affiliate Marketing

Involved affiliate marketers have a much deeper connection with whatever they promote. They either have used the product themselves or they share real experiences of people who have used the product or service. Though this type of affiliate marketing comes with risks. If a product or service doesn’t hold up to expectations, it hurt the reputation of the marketer.

Most Common Affiliate Marketing Programs

Some of the most common and most profitable affiliate marketing campaigns are:

  • Amazon affiliate marketing program
  • Etsy affiliate marketing program
  • eBay affiliate marketing program
  • ClickBank affiliate marketing program