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How affiliate marketing works? It is a goldmine that we are going to explore deeply today.

How Affiliate Marketing Works
How Affiliate Marketing Works

Hello! I’m here to share with you that affiliate marketing is not a scam! It is a real business.

Actually, Affiliate Marketing isn’t a new thing…

If we search online, then there are plenty of methods to earn online.

According to Statista, freelancing is expected to reach up to $8.2 billion by the end of 2022.

Moreover, about 81%-84% of publishers are now using affiliate marketing to earn income and online promotions.

But if we look deeply, “what is affiliate marketing, and how does it work” is the number one trend.

Affiliate marketing is among the best ways to produce a passive income online.

It is a popular tactic to increase sales and generate online revenue. And nowadays, this way is becoming more significant for brands and affiliate marketers.

But I can say it’s possible to earn money online with affiliate marketing, a good passive income every month.

This beginner’s guide about affiliate marketing will tell you what is it and how affiliate marketing works.

So, let’s learn about this term in detail.


What Is Affiliate Marketing?

First off, what is Affiliate marketing?

Affiliate marketing is a method in which we promote other people’s products against a certain commission amount.

In this type of online marketing, you find a product and sell it to others.

As a result of this affiliation, you will earn a commission against the marketed products.

Moreover, as an affiliate marketer, you can work with different affiliate programs to make a commission.

The following stats are telling how affiliate marketing is trending.

  • Now 81%-84% of businesses prefer affiliate marketing in the USA to promote their sales.
  • We saw a surge of 10% in affiliate marketing spending in the United States. However, it means that this number reached up to $6.8 billion in 2020.
  • Between 2015-2020; Google saw a surge of up to 200% in the search for affiliate marketing.
  • Moreover, according to the AM navigator, around 40% of the marketing professionals consider affiliate marketing a top digital skill.

In this case, the promising figures show that this side hustle could turn into a full-time business.

If you perform well on an affiliate marketing platform, then it is a great earning opportunity.

Parties Involved In Affiliate Marketing:

According to Wikipedia, there are four parties in the process.

How Affiliate Marketing Works
Parties Involved In Affiliate Marketing
  • The Merchant: This is the company that sells the product, and who actually owns the product (or service). It can be called a vendor, a retailer. or even a brand (like Amazon, Nike, Dyson, etc). Or it can small home-based entrepreneur.
  • Affiliate: The word affiliate means publisher, i.e. the party that promotes the Merchant’s product. However, this party can range from a single individual to the entire company. As a result of affiliate marketing, these companies earn thousands of dollars in terms of commission.
  • Network: The network acts as a connecting point between the merchant and the affiliate. In other words, it is the market places that provide offers to the affiliate to work on. If we look at the famous examples of networks, then ClickBank and ShareASale are the most popular names of this kind.
  • Consumer: The customer makes the affiliate system go round. Without consumers, affiliates can’t earn a commission.

After learning what is affiliate marketing now, we move towards the next step. If you want to become a marketer, then read on and learn how affiliate marketing works.

Terms About Affiliate Marketing

Here are some of the terms that are associated with affiliate marketing. To know how affiliate marketing works, let’s discuss these terminologies.

AffiliatesPublishers who use affiliate programs links to promote commodities
Affiliate marketplaceThese are networks or central databases for affiliate programs like Amazon, and Clickbank
Affiliate softwareSoftware that companies use to create affiliate links and programs
Affiliate linksUnique link generated by networks to track the progress of promotion
Affiliate IDIt is a bit similar to the affiliate links
Payment modeDifferent affiliate networks offer different ways to withdraw money
2-tier affiliate programIn this method, you recommend others to join an affiliate program, and in return, you receive a commission if a sub-affiliate sale something
Custom affiliate incomeMany companies offer custom affiliate income when they make the most sales
Terms About Affiliate Marketing

Not too challenging to understand know the above terms and what they mean, right?

Due to this deep understanding, you can perform well and earn money on an affiliate marketing platform.

Understanding How affiliate marketing works

This affiliate marketing model is very simple to understand, here’s a quick look behind the scenes of How Affiliate Marketing Works:

  1. When you join an affiliate program, the related affiliate merchant or network will give you a unique affiliate ID, i.e. your special affiliate link for the product you want to promote.
  2. You place the link in your blog (and/or any other marketing effort) and promoting the products
  3. Your audiences visit your blog and read your blog content. Once they click your special affiliate link, they are taken to the merchant’s website.
  4. Whenever your blog visitors complete the purchase process, the merchant checks the affiliate ID and identifying the source of the referral.
  5. Once the merchant finds and confirms your affiliate ID, you are credited with the sale.
  6. You will earn the affiliate commission from the merchant according to the affiliate agreement.
How Affiliate Marketing Works
Understanding How Affiliate Marketing Works

How do I become an affiliate marketer?

My journey to becoming an affiliate marketer was not easy, and i didn’t get rich overnight.

But I can say it’s possible to earn money online with affiliate marketing, a good passive income every month.

It was September 2016, like it was yesterday.

I were struggled with my 9-5 job and started to search for the ideas of “working from home” on the internet, then i found something interesting – Wealthy Affiliate.

Well, it was a pivotal moment in my life, however, I didn’t realize that at the time.

I have joined Wealthy Affiliate as a free starter member and started the training they provided.

And very soon, i have become their premium member because i want to learn more about how to start a blog and make money online.

Now, after 5 years, i have quit my job and become a full-time blogger and managing 2 blogs

Each of my blogs brings me about 4 figures of passive income each month.

That may not be very big money, but it is far more than enough for me to work at home and enjoy my work-life-balanced life!

All in all, money doesn’t just fall out of the sky.

If you want to become an affiliate marketer like me and earn money online, you need to put in your work and make your dreams come true step by step

Here is what you need to work on if you want to start your affiliate marketing business

  • Step 1: Build up an online affiliate media – your website
  • Step2: Choose an affiliate niche
  • Step 3: Find affiliate programs to join
  • Step 4: Create great content to engage people
  • Step 5: Drive traffic to your blog
  • Step 6: Get clicks on your affiliate links and purchase that product

1st Step: Build up an online affiliate media

You can start affiliate marketing using any available platform.

But my #1 recommendation is Start Your Own Blog.

In fact, you can also take social media like Facebook and Instagram as your affiliate marketing media.

But I would not suggest you solely relying on social media.

Why???

Because it will limit your audience reach rate.

And your affiliate marketing business’s success will mainly depend on the number of friends or followers you have. 

With your blog, you can reach customers over the world that there has internet.

Furthermore, a blog can help you connect with your potential customers differently from social media by building a brand with its own identity.

p.s. You can set up your social media to promote your blog and your affiliate products. Learn more here

Actually, setting a new blog is relatively easy and cheap.

If you don’t have one yet, check out another popular post: How to Create a Blog for Free and Make Money For Beginners

After setting up and optimization the blog, you are all set to add affiliate links.

Apart from this, it’s always better to link different platforms to capture more traffic.

2nd Step: Choose An Affiliate Niche

It is one of the most significant steps that provide the base to your affiliate marketing platform.

If you decide to start work as an affiliate marketer today, you have to face a ton of competition.

Do you know, there are over 100K+ active affiliate marketers in the Largest affiliate networks.

So, it’s crucial to choose a niche on which you have the expertise and in-depth info.

In that case, you will gain your customers’ trust and build a good relationship with them.

As a result, they will purchase the products you recommended.

Moreover, don’t worry if you aren’t an expert in this field. Apart from this, if you are outsourcing content, it’s good to work with an expert team.

So, always choose the team that can create high-quality, engaging, and informative content to increase sales.

3rd step: Find an affiliate marketing program to join

It is the third and another vital step to follow.

You have to pay full attention to how to choose affiliate marketing networks.

Here are the three main types of affiliate programs:

How Affiliate Marketing Works

High paying, low volume affiliate programs

In this type of affiliate program, you sell niche products against high payout. However, affiliate marketers have to put more effort into selling these items.

As a result, companies pay more to marketers to acknowledge their efforts.

For example, if you promote a health product, like resurge, in Clickbank, you will earn $ 112.37 per sale.

How Affiliate Marketing Works

But remember that there is more competition in the market for programs with high commissions. So, be cautious while choosing programs like these.

Low paying, high volume affiliate programs

It is the second type of affiliate program that comes with a larger market but low commission rates.

We can take the example of toys.

Under the Amazon associate program, the Fixed Standard Commission Income Rates of Toys is 3%, i.e. if a customer bought a toy at $45 via your affiliate link, then you will earn $1.35 by return.

If you are interested in these types of programs, then you need lots of traffic.

High paying, high volume affiliate programs

These products are for the masses with a high commission rate.

We can take the example of credit cards; everyone needs them, and people stay with them for years.

For example, Bankrate‘s affiliate program offers up to 3000 products and a commission rate up to 40% revenue share per sale.

How Affiliate Marketing Works

But it would help if you have in-depth knowledge and tactics to sell these types of products.

4th step: Create useful content

“Content is the king.”

Yes, it’s true because the content will decide whether you are going to win the game of affiliate marketing or not.

If you want to grow, you have to create high-quality content to fit an affiliate link naturally.

Moreover, don’t blindly follow other people’s ideas and content.

If you want to attract more visitors, create something unique and go the extra mile to solve the reader’s problem.

For instance, if you are writing reviews, it’s better to try products before suggesting them.

Related Reading: Write A Perfect Blog Post That Gets Reads – 11 Tips For Writing A Good Post

5th step: Drive traffic to your affiliate blog

After creating great content now, the next step is to find more people to reach your blog and read your content. As a result, more clicks on your affiliate link.

So, here are ways to get traffic:

  • SEO
  • Build an email marketing list
  • Paid traffic

Search engine optimization(SEO)

It is an organic but time-taking way to get traffic to your blog.

SEO is a practice to rank your website higher on the search engine. So, if you rank high on search engines and understand how affiliate marketing works, then its’ all well.

Moreover, in SEO, you have to take care of the technical stuff to push your pages higher on the search engine.

Build an email list:

If you develop an email list, then you can communicate with your audience anytime. It is the best way to keep your audience UpToDate about upcoming content.

As a result of this practice, you will get more affiliate traffic, clicks, and leads that will later convert into sales.

Paid traffic

In this method, you get traffic after paying to the search engine. These are the ads that promote your blog at a higher ranking to get the reader’s attention.

But you will not receive traffic when you STOP paying.

It is quite normal to lose money at first, but it happens, and you will get pro with time.

In common opinion, paid traffic is useful if you are a part of a high-paying affiliate program.

But if you are a part of programs like the Amazon affiliate program, then it’s not a good idea.

Click Here to learn more about how to get traffic to your new blog.

You have a piece of content on your blog, then it doesn’t mean that people will click.

So, if you want to earn more clicks, then you have to adopt the following strategies.

How Affiliate Marketing Works
  • Link placement:
    • If you place your affiliate link at the bottom of the page where people rarely scroll, then its’ not right.
    • Moreover, if you put links in the introduction, then your content will look spammy. So, it would help if you create a balance in link placement.
  • Context:
    • If you are creating content, then make sure to produce a relevant article engagingly.
    • Moreover, try to introduce links naturally and try to answer the user’s concerns and questions.
  • Callouts:
    • If you create callouts like buttons, tables, graphs, and boxes is best to attract readers. It is a great way to make your post less spam able.

At the end of all things, now work to convert visitors into leads and buyers.

In this way, you can make money using affiliate marketing.

To sum up, in affiliate marketing, you need TWO conversions to make money:

One is to make the visitor to “click at the product page.”

The second is to instigate visitors to “purchase that product.”

Frequently asked questions:

Apart from the above topics, there are still a few things missing to know what affiliate marketing is.

So, read the answer to these questions to understand how affiliate marketing works.

Where to start my affiliate marketing?

To become an affiliate marketer, you need a blog, and below

  • Hosting
  • Domain name
  • Web design
  • Website maintenance
  • And attention-grabbing themes to attract visitors.
  • Proper training program

I started my affiliate blog with Wealthy affiliate, the biggest blog community globally.

It works as a one-stop-shop for all these things, plus online classes and training.

In one package, you will get all at an affordable price to make a start and link yourself with a marketing program to earn money.

Here are the following services that you will get in an affiliate marketing of a Wealthy Affiliate.

Certification Core Training: Level 1-5 (50 lessons)
Bootcamp Core Training: Level 1-7 (70 lessons)
1000+ Training Modules
52 to 200 + Expert Classes Per Year
Websites Builder – Create your blog within a few minutes and clicks
Secure and Fast Hosting
Live & Interactive Help  (24/7 worldwide)
Free SSL
Keyword Tool (Jaaxy.com)
Affiliate Program Search
Close the 1.5 million HELPFUL community members
And much MORE!

So, don’t wait and start to earn money by using a one-stop shop of Wealthy Affiliate.

Here you will get everything from domain name to affiliate program and free trial period.

Thus, don’t wait and sign up now to register yourself in a free training program.

>>>Click Here <<<

Learn More About Affiliate Marketing and How To Create Your Website TODAY

Can you make money using affiliate marketing?

Affiliate marketing is increasing. We already discussed the Statista report, that this industry will reach up to $8.2 billion in the US by 2022.

So, it’s growing day by day.

But once again, Affiliate marketing is not a “get-rich-quick” game, and you can’t be rich overnight.

And as a beginner, please don’t believe those who told you that you can earn from zero within a month for $1000 or even more.

For the real successes stories, those bloggers have been put all their work for a year or even more.

Read more here about the real success stories from those who are earning a massive amount who has been put in their work in affiliate marketing.

Can I start affiliate marketing with no money?

Yes, it’s 100% possible to start earning money without investing any money.

Wealthy affiliate offers a totally free starter membership account to starting your first blog, no credit information is needed.

You only need dedication, motivation, and the right direction to put your energies to earn money online!

How Affiliate Marketing Works
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How Affiliate Marketing Works

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12 Comments

  1. Hi, Rose,

    I’ve been trying affiliate marketing for quite some time now, but unfortunately, I haven’t made a single sale. I’ve tried almost everything (except for the mailing list), but still no results. My traffic has been increasing over the last few months, but there are no conversions. What could I be doing wrong? I’ve read a lot about success stories. I’d like to quit my job and do this full time, but I can’t afford it right now.

    I’ll keep trying. I’ve been learning a lot, but all newcomers must understand it’s not easy. You have to work hard for it.

    Thanks for sharing.

    1. Hi Enrique, the first thing I would like to mention is that blogging and affiliate marketing is not a “get-rich-quick” game and need to put into work. But you will get the return if you do not give it up! 

      The success of blogging depends on many things. for example, if you already get enough traffic, then i will suggest looking into your content if your content related to your affiliate product? did you build enough trust to your audiences? Besides, the quality of the affiliate product will also affect the conversions.

      hope it helps. Thanks

  2. As I understand it now, affiliate marketing is not a scam, although many of them are.  However, people can earn money from affiliate marketing.  I heard plenty success stories that sound legit from good people.

    But you have to put in the work.  

    Thank you so much for your post on “how affiliate marketing works.

    Nicole,

    1. Hi Nicole, thanks and your are right, all about the success stories of affiliate marketing is to put in the work! Money will not fall over a night to your pocket, and it’s all I have always emphasis to my readers 🙂

  3. Hi Rose, this article was really helpful and interesting to read, it has laid out everything I needed to know in a simple and easy-read format. I’m just starting out in affiliate marketing and I’m super excited about the possibilities available! How long did it take you before you started to earn a decent income?

    1. For me, it takes around one year to earn a decent income. But everyone is different, some bloggers take 1-2 month, and some takes serval years. It depends on your niche and how hard you put in your work.

  4. Hi Rose, thank you very much for writing a thorough guide to start an affiliate marketing business. Since the pandemic hit us globally, I get more chunks of free time and want to utilize it for creating passive income. I want to create a blog in the mobile gaming niche, do you think it’s still a broad niche? Also, do you think it’s good if I target a local/specific area? I’m not really confident in my English writing (not a native). Thanks

    1. The mobile gaming niche is GOOD, but it’s a bit competitive, suggest you choosing a sub-niche and be specific to focus on the starting state of your blog. And I don’t really suggest targeting a local/specific area, as i may not good for SEO. 

      Hope it helps.

  5. Hi Rose. Very interesting article. Im just starting my adventure with digital marketing and posts like this are extremely useful. Thank you for this guide, with lot of useful advices and recommendations which Im planning to use in practice. Also wealthy affiliate program seems as a great starting point for beginners.

    1. Hello Cogito, comments like yours means a lot to me, thanks for your feedback and good luck to your affiliate adventure!

  6. This really went down to the basics and affiliate marketing. It is literally perfect for beginners like myself. I am someone who is currently trying to get into affiliate marketing but I have not been able to find a good website that actually narrows it down to me in order for me to actually be able to understand it. Thank you for this

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