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What is Affiliate Marketing?

What is Affiliate Marketing?

Affiliate marketing is an online sales tactic that lets a product owner increase sales by allowing others targeting the same audience – “affiliates” – to earn a commission by recommending the product to others. At the same time, it makes it possible for affiliates to earn money on product sales without creating products of their own.
The cost to the customer purchasing the product or service through an affiliate is the same as buying directly from the product owner.
While product owners make less money per sale because they must pay a percentage of the sale to the affiliate, they are also reaching potential customers they probably wouldn’t reach on their own.
Affiliates can earn commissions on a one-time purchase or recurring income through sales of subscriptions or membership programs.

How to Become an Affiliate

Marketers become affiliates in a number of ways that include:
  • Registering to become affiliate on retail or ecommerce sites. Shopify, for example, has an affiliate program that lets marketers earn commissions on new Shopify customers.
  • Surveying existing customers to learn their favorite products or services and then contacting those companies to inquire about an affiliate program. For example, a small business marketing consultant might become an affiliate of an email list management and distribution service. 
  • Searching online for products that are relevant to the marketer’s site and will appeal to the target audience. Most companies that offer affiliate programs indicate that with an “Affiliates” or “Partners” link at the bottom of their site home page.
  • Looking for potential affiliate products at affiliate program managers that include Commission Junction, Clickbank, and ShareASale.

How It Works

After being accepted into an affiliate program, marketers receive a unique URL that includes their affiliate ID. They share that unique URL with their subscribers, site visitors, and social networks via text links or ads. When someone clicks on that link, affiliate software records that click and any resulting product sales in the affiliate’s account. When commissions reach a pre-determined threshold, the affiliate is paid.

Best Practices

Most importantly, FTC guidelines require that affiliates disclose when they’re using an affiliate link, whether it’s on a website or in an e-mail message, tweet, or social network status update.
Affiliates are most successful when the products they promote match the interests of their followers and subscribers. In addition, many successful affiliate marketers advise recommending and promoting only products that the affiliate is personally familiar with. That’s because familiarity with the product, program, or service helps build trust between the affiliate and end-user.

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