Affiliate marketing: a simple guide

In affiliate marketing, affiliates, or independent marketing partners, promote a brand's products or services in exchange for a commission on each website visitor, lead, or sale they generate. A brand may work with several parties in their affiliate marketing strategy, including:

• Affiliates
  Affiliates are individuals or companies that market a brand’s products or services on their own platforms, such as websites, blogs, and social media accounts. Affiliates produce content to show the value of a brand’s offerings to consumers. This content is designed to persuade potential customers to take actions like clicking on a link, signing up for a free trial, filling out a form, or purchasing a product.
• Networks
  Networks are companies that connect brands and affiliates. A brand may join a network, which is usually an online platform, to find affiliates who would like to promote its products. An affiliate may sign up for a network to look for brands they’d like to promote and gain access to promotional texts or creatives. A few of the most popular affiliate programs include the Commission Junction Affiliate and Pepperjam.
• Agencies
  Agencies are companies that match brands to affiliates and monitor affiliate programs. They are designed for brands who would like to take a hands-off approach to their affiliate marketing program or those unable to manage the process in-house. Unlike networks that are online platforms with multiple brands and affiliates, agencies are composed of professionals who use their connections to provide brands with the right affiliates. They also negotiate favorable commissions and measure program success.
• Consumers
  Consumers are essential to the success of any affiliate marketing program. Affiliates must create compelling content to influence consumers to click on a link, fill out a form, or purchase a product. Affiliate marketing can be a powerful form of social proof. According to research, 88% of consumers trust online reviews as much as personal recommendations.

With a successfully executed affiliate marketing strategy, each party can realize significant benefits.

How does affiliate marketing work?

While every affiliate marketing program has its own target audience, unique features, and budget, most of them function in a similar manner.

Brands create affiliate programs

A brand will decide they’d like to use affiliate marketing to promote their offerings and increase revenues, in turn creating their own program and recruiting affiliates. Alternately, they use an agency or network to help them get up and running. It’s important to note agencies and networks aren’t necessary for the success of a brand or affiliate. However, they may be useful to those new to affiliate marketing.

Affiliates promote the brand on their platforms

An affiliate will promote your brand on its website, blog, or social media outlets using articles, videos, advertisements, emails, or even podcasts. Every time a consumer clicks on your brand’s promotion, a tracking cookie is stored in their browser. The cookie allows you to track the consumer’s behavior.

Consumers take action

The consumer will likely be redirected to your website or landing page so they can make the desired action such as filling out a form or purchasing a product. Once they have answered the call to action, the cookie will activate so the affiliate will receive a commission based on the rules established for driving a lead or sale.

Brands and affiliates share revenue

Since affiliate marketing depends on a revenue-sharing model and affiliates receive a set commission, some affiliates will earn more money than others for a number of reasons. First, they may publish higher-quality content and utilize proper SEO strategies. They may also have a superior website experience, a deeper understanding of what you’re selling, and an audience better suited for your products.

Additionally, some affiliates may simply choose brands which pay higher commissions. The price of a product or service, industry, and value a brand sees in affiliate marketing will all play a role in commission rates. On average, however, an affiliate commission is anywhere between 5 and 30% of a sale. Commissions are usually paid out on a monthly or quarterly basis.

The type of program affiliates choose may also influence their earning potential. Your program will likely fall into one of the following categories:

• High-paying, low-volume
  High-paying, low-volume affiliate programs involve niche products that deliver fewer selling opportunities yet offer higher payouts. They tend to be more competitive, so less experienced affiliates may have a difficult time succeeding with them.
• Low-paying, high-volume
  Low-paying, high-volume affiliate programs are attractive because their products typically appeal to a large audience. They may be a good fit for affiliates that receive lots of site traffic.
• High-paying, high-volume
  High-paying, high-volume affiliate programs appeal to a wide variety of people and pay higher commissions. Unfortunately, some participating affiliates implement obnoxious marketing tactics such as “spamming” content across engagement channels to draw consumer attention.

Brands track and measure ROI

With a strategically designed affiliate marketing program, you can easily track and measure the marketing activity and success of your affiliates. You’ll be able to calculate ROI very effectively so there won’t be any uncertainty about the success of your program.

Benefits of affiliate marketing

Affiliate marketing can be a great business option for your business on multiple levels.

• Affordability and control
  Since affiliates produce content to promote your products and services, you don’t have to create content or hire freelancers to do so. This makes affiliate marketing more affordable to implement and manage compared to other marketing methods. Additionally, you have control over your affiliate commission expenses, meaning you can choose budget-friendly rates which attract quality affiliates and you can decide whether you want to utilize an agency or network for support.
• Increased brand awareness
  Affiliates help spread the word about your brand to new audiences that may have been unreachable in the past. Since their followers are learning about your brand from a trusted source, it’s likely many of these followers could become future customers.
• Improved SEO
  No matter what you’re selling, affiliate marketing can help build more backlinks to your websites and social media pages. This can help motivate organic traffic and generate leads and sales, ultimately strengthening your SEO strategy.
• Low-risk
  Before you bring on affiliates, determine when and how much you’ll pay them. You won’t have to worry about any last-minute or surprise costs because the financial details will have been determined in advance. This can be a huge perk, especially if you’re a startup or smaller business with a limited budget.
• Less time to manage
  Affiliate marketing requires less time and energy to manage than other types of marketing. For example, SEO won’t be effective unless you engage in consistent content creation, link building, and site optimization. Social media marketing involves fresh content and interaction with fans or followers on a regular basis. Once you get an affiliate marketing program up and running, your time commitment will be minimal. While you may have to keep in touch with affiliates and make payments, these tasks are fairly quick and routine.

Tips for your affiliate marketing strategy

Having explored the benefits of affiliate marketing, let’s review some tips on implementing a strong strategy.

Fine-tune or create your product

Before you start your affiliate marketing journey, make sure your new or already created product is perfected by gathering feedback from current customers, researching competitors, and refining messaging. You can’t create a poor or subpar product and hope affiliates will still be capable of selling it. Make sure to articulate the unique selling points which differentiate your product from competitors.

Find your niche and target market

Once you’ve finalized your product, figure out what you’d like your angle, area, or focus to be. For example, if you’re in the beauty industry you may need to decide if your focus will be on eyelash extensions or natural makeup. From here, you will need to determine your target audience by using Google Analytics and other data analysis tools to target consumer segments who have purchased from you or expressed interest in your brand.

Find affiliates

When it is time to search for affiliates, keep in mind not all are created equal. Make sure that the partners you choose can bring the following qualities and resources to the table:

• Professional digital assets
  Affiliate social media platforms and websites should be appealing in both form and function. Generic or “spammy” digital assets may repel existing and potential customers.
• Align with your business focus
  Affiliates should be involved with consumer segments appropriate for your offerings. For example, if you’re selling handmade bath soaps, it doesn’t make sense to target a music-focused affiliate. You may want to consider a beauty blogger who enjoys reviewing unique makeup and personal care products.
• Communicate well
  Ideally, your affiliates should have strong written and interpersonal communication skills. These are the types of individuals who will have the capability to present your brand with the degree of professionalism necessary to grow your audience.

Manage affiliates

After you’ve recruited affiliates and set up tracking, it is time to start managing your program. Get into the habit of measuring affiliate results on a weekly or even daily basis. Doing so helps to re-evaluate partnerships with affiliates who aren’t performing well while incentivizing top performers by increasing commissions or providing free products and services.

Pay your affiliates on time and communicate with them frequently so you can answer questions or address concerns. You may want to schedule monthly or quarterly meetings with your top-performing affiliates to continuously improve the partnership you have with one another.

Tips for becoming an affiliate marketer

While affiliate marketing offers an excellent opportunity for brands to drive revenue, it also helps affiliates develop a generous income stream. If you’re intrigued by the idea of earning money as an affiliate marketer, here are some handy tips.

• Choose a market focus and channel
  Go for a consumer market you’re particularly passionate or knowledgeable about. Then, figure out which channels you’re going to use to promote affiliate products. These may be websites, blogs, YouTube channels, or social media platforms.
• Find relevant brands
  You can use an affiliate program like Pepperjam or the Commission Junction Affiliate to look for brands that may value you as an affiliate. You can also visit brand websites and search for information on how to join their affiliate programs.
• Create quality content
  Once you’ve found a brand or two that would like to work with you, focus on generating engaging content to help you drive conversions. Discuss your own experiences with the products you’re promoting, integrate SEO best practices within your content, and develop messaging specific to your audience's interests.
• Keep trust top of mind
  Building trust is the key to driving conversions. By only partnering with brands whose products you would actually purchase, actually testing products, and being honest about their benefits, you’re more likely to succeed.

Affiliate marketing takes strategy and hard work for affiliate marketers just as much as it does for brands. However, if you’re willing to put in the necessary work, you can potentially enjoy significant rewards. These may include free merchandise samples, generous commissions, and advance exposure to groundbreaking products.

Let affiliate marketing work for you

Regardless of your business size or industry, affiliate marketing can spell success for your business. It may be the perfect addition to your current digital marketing program, delivering the opportunity to maximize profits in an affordable, low-risk manner. Once you start earning money from affiliate marketing, you will find new ways to continually improve and grow the program.

If you’d like to develop your own affiliate marketing program, Adobe Commerce can help.

Schedule your free demo today.