Affiliate Marketing For Beginners

by | Marketing, Business | 0 comments

The fourth in our no-nonsense “for beginners” series, breaking down the foundational aspects of marketing.

What is Affiliate Marketing?

Very simply put, a form of marketing where you receive a commission for advertising the products of another business entity. Affiliate marketers (also known as “affiliates”) choose a product they enjoy or appreciate, market it to their own curated audience online, and receive a predefined payment for each unit sold. This may sound similar to the work of a salesman, and in some ways it is, but a key difference is that an affiliate marketer is not on the payroll of the product vendor, but rather can be any individual with whom the vendor is willing to work to advertise products. In practical terms, most affiliate marketers are people with social media followings, and/or their own personal website where they blog about products.

Though there are benefits to both vendors and affiliates in this form of marketing, this article will be focused on affiliate marketing from the perspective of the vendor– those looking to use the services of affiliate marketers.

How Does It Work?

In any given affiliate marketing arrangement, there are at least a minimum of 3 parties involved- The advertiser, the affiliate, and the customer. In some cases however, a separate “affiliate network” vendor is utilized, which provides the software means by which the sales are accurately tracked and correctly attributed to the appropriate affiliate.

The typical process involved in affiliate marketing can be summarized in the following 4 steps:

An affiliate promotes your products/services across their varied online platforms (such as blogs, youtube, social media) while ensuring to include visible links for your store.

A customer clicks the link and follows through with a purchase on your website.

The affiliate network records the transaction, and/or your business confirms the purchase.

Upon receipt of payment, the affiliate is paid their commission.

Why Is It Important For Your Business?

Affiliate marketing is highly popular for the win-win it creates for vendors and independent product marketers; vendors gain a low-maintenance avenue for advertising, while affiliates can take advantage of a revenue stream from “selling” products, without the hassle of designing, manufacturing and warehousing etc.

Being a commission-based model, affiliate marketing is premised upon the concept that your affiliates will earn in accordance with the amount of units sold. What this means for you is that this marketing avenue naturally incentivizes your affiliates to work hard to creatively utilize their online presence to generate sales clicks, leads and sales.

As far as personalities and follower counts go, affiliates come in all shapes and sizes. What this means for your business is that this form of marketing offers the opportunity to communicate with a wide diversity of demographics in a language that makes sense to them. In the case of internationally marketed products where language barriers are a concern, this is especially true.

Each affiliate is effectively a highly personalized brand ambassador with their own unique, cultivated audience. In the vast majority of cases, your affiliate understands or can understand far better than you do what key selling points will appeal to their kind of viewers. Best of all, the affiliate is incentivized to figure this out and handle this marketing with no input at all from you.

In other words, affiliate marketing opens the door to a hands-free marketing approach for businesses, where money-wasting market research and one-size-fits all top-down campaigns can be replaced with a genuine, intelligent, dynamic and laser focused approach that adapts to fit each affiliates unique audience… And all that without you as a business owner needing to spend a cent, except for when purchases are finalized.

By the way, if you are looking for a well established platform on which to market your products, check out Amazon and Clickbank.

In the vast majority of cases, your affiliate understands or can understand far better than you do what key selling points will appeal to their kind of viewers. Best of all, the affiliate is incentivized to figure this out and handle this marketing with no input at all from you.

Types Of Affiliate Marketing

There are three main types of affiliate marketing: unattached affiliate marketing, related affiliate marketing, and involved affiliate marketing.

Unattached Affiliate Marketing: A model in which the affiliate doesn’t have any skills or knowledge related to the product. An uninvolved model which requires scant research on the part of the affiliate. Marketers may for example simply place the item on their website along with a description and a link to purchase, with little if any input beyond that.

Related Affiliate Marketing: Marketing where the affiliate bears a relation to the products or services being offered. Often (but not always), each affiliate is known for a specific area of knowledge, and typically the promoted products will fall within this niche. The apparent expertise of the affiliate fosters a level of with customers, who are often more willing to act upon a recommendation as a result. In this type of affiliate marketing, the affiliate has generally not used the product they are recommending.

Involved Affiliate Marketing: Where affiliates have actually used or regularly use the services and products they are recommending. In depth blogs and video reviews typically accompany this form of marketing, as well as comparisons with items from competitors. This type of affiliate often stakes their reputation and viewership upon the quality of their recommendations, therefore they have a higher need to ensure that they can guarantee that what they are saying about the product holds true.

How Payment Is Structured

Affiliates typically get paid in one of 5 common ways:

Pay-per-sale: The most common form of payment structure in affiliate marketing. Your affiliates get paid an agreed upon price or percentage (a commission) per unit sold upon receipt of payment.

Pay-per-click: A rare setup where you pay your affiliates an agreed upon rate for every click on your link. PPC campaigns can be used to increase brand awareness. Be aware however that all the business owner is paying for is for customers to simply visit your site, nothing more.

Pay-per-lead: An arrangement in which the affiliate is paid every time a customer signs up to something. Many independent marketers prefer to generate leads as their source of income, rather than to sell the product, due to the easier workload in comparison to generating sales.

Pay-per-action: Where a commision is earned by the affiliate every time an agreed upon action is completed by a customer. A prominent example of this (and pretty much a category in its own right) is pay-per-call, whereby the goal of the affiliate is to generate calls to the vendors business, in other words, to help with the creation of “warm leads”. Some other examples of desired actions businesses can pay affiliates for include form submission and requests for contact.

Pay-per-install: Affiliates are paid for every software installation that results from their promotion. If your company manufactures apps this may be a good option for you.

Affiliate Quality

As you go about deploying this marketing strategy in your own business, you want to be mindful that, beyond the quality of your own product and service offerings, you will need to also keep an eye on the quality of affiliates you are attracting.

Generally, there are 3 types of affiliate marketers that it may help to be aware of, which we’ll call “Vampires”, “Fifty-percenters” and “The Genuine”.

(Note: While these may appear to correlate directly with the aforementioned 3 types of affiliate marketing, that is not always or even necessarily the case).

“Vampires” are those that have latched on to your product and will flog it ruthlessly without ever having personally used it, and with no regard for quality (or lack thereof). This type of affiliate doesn’t really know anything at all about the products they spruik other than what they have picked up via a lazy scan of Google’s search results. Their only concern for the end-user is how fast their money arrives in their own bank account, and frankly, these are the scummy guys that give affiliate marketing a bad name. You want to avoid having your products associated with this kind of marketer where possible. If you do have a product associated with one of these guys it can taint the reputation of your products.

“Fifty-Percenters” are the hit-and-miss crowd, those who may know something about the general area of knowledge that your product applies to, and have some interest in your product. Their desire to sell your products stems from a mixture of appreciation and a wish to make money. These kinds of affiliates are okay, and have a more genuine concern for the end-user and actually making sure they are promoting a decent product. Associating your products with this type of affiliate is not an issue.

“The Genuine” are those affiliates who are passionately and genuinely dedicated to the products they promote to their following. Affiliates that fit in this category are often those for whom product promotion is a selective and careful process. There are many channels that exist on Youtube that are run by individuals who fit this description, and many of them have substantial followings built upon a reputation for thoroughness, accuracy and honesty. A common phenomena associated with this sought-after class of affiliate is a gargantuan spike in sales traffic following a positive video review of a product on their channel. Where possible, it is a great strategy for businesses to target these higher value individuals for affiliate programs.

The Final Word

With rampant technological upheaval driving a rapid change in lifestyles, the number of individuals seeking a reliable outlet through which they can make an income online has increased exponentially. Amid the fray of options for novices and veterans alike, affiliate marketing has proven itself to be a steadfast and popular means for content creators to monetize their pre-existing online presence. Businesses can capitalize on this trend greatly, by harnessing what amounts to a cheap and effective marketing stream with very little input from their side, that guarantees the ability to authentically reach diverse audiences that very few other other avenues offer.

If you are interested in boosting your online sales via affiliate marketing programs but don’t know where to start, get in touch with us at CreativeJC and we’ll point you in the right direction.


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