Affiliate Marketing

What is Affiliate Marketing?

Affiliate Marketing is a practice of paying a commission to online publishers (such as bloggers, e-magazines and news sites) that promote or feature your product on their sites and networks. It is an Internet-based business system that promotes products or services of other merchants as affiliates and gets a percentage of commission from it.

Affiliate marketing can be compared to real estate agents who do not own the property but help people with homes to promote sales and get commissions from home sales. This type of marketing is referred to performance-based marketing in which a business rewards one or more affiliates for each visitor or customer brought by the affiliate’s own marketing efforts. The industry has four core players:

  1. The merchant (also known as ‘retailer’ or ‘ Brand’),
  2. The network (that contains offers for the affiliate to choose from and also takes care of the payments),
  3. The publisher (also known as ‘the affiliate’), and
  4. The customer.

Publishers only earn a commission when they drive any performance, so you only pay for affiliate marketing when it works.

The objectives of using affiliate marketing are:

  • Reach more people
  • The biggest goal of affiliate marketing is to let more people click on your promotion link to the sales page of the merchant
  • Generate more sales

The affiliates should be:

  • Brand Relevant
  • Can help in generating more sales, and
  • Should have high traffic
History of Affiliate Marketing

The patent for affiliate marketing was granted to William J. Tobin in 1989. He set up the first affiliate marketing program ever for his company PC Flowers & Gifts

In 1994, CDNow and Amazon launched affiliate programs as a marketing strategy, making them among the earliest companies to utilize it. The idea was to have publishers place ads for products in their websites. The publishers then get commissions every time they make a sale. It is said that Amazon has over a million affiliates worldwide.

Amazon was the first company to use affiliate marketing as a program that was available to the general public, launched in 1996.

What is an Affiliate Network?

The affiliate network acts as an intermediary between affiliates (publishers) and merchant (advertiser) affiliate programs. It allows Affiliates to find affiliate programs, which are suitable for their website and it helps websites offering affiliate programs reach its target audience

Some Indian Affiliate Networks are:

  • vCommission
  • Admitads
  • iCubesWire
  • DGM
  • Optimise
  • Intellect Ads
Types of Affiliate Marketing
  • Webmasters
  • Loyalty/Cashbacks
  • Coupons
  • Content
  • Review sites
  • Email Marketin
Affiliate Models
  • Pay per Click (PPC)
  • Pay per Performance (PPP):
    • Pay per Sales (PPS)
    • Pay per Lead (PPL)
Affiliate Marketing Process
How to make money from Affiliate Marketing?

If you want to enter the world of affiliate marketing, just follow the below affiliate marketing basic process steps:

  1. Build a website (using the website promotion alliance and its products is the most common method) and then add at least 1-3 alliance projects (for beginners, it is recommended to join one at first, familiarize yourself first), and then get approval from the other party.
  2. Write a few articles to introduce the product, which is a product review
  3. Add the approved affiliate link to the product (this is a very special link that contains your ID, which the merchant uses to identify the franchise)
  4. Attract targeted customer traffic to your website, making your site ranked in the top ranks of Google or major search engines (under certain keywords)
  5. Customers start landing to your site for the product via a search engine or direct
  6. Ends buying the product from your affiliate links
  7. Basis all the above steps, affiliates earn commission
Popular Affiliate Program In India
  • Flipkart Affiliate Program

Flipkart is top e-Commerce websites in India, and they offer an in-house affiliate program. The program is quite beneficial as it offers good commission, along with a lot of affiliate tools for promoting Flipkart products.

  • Amazon India Affiliate Program

Just like Flipkart is India’s biggest online vendor, Amazon too is the biggest global online vendor. Amazon India has also started its own affiliate program known as Amazon Associates which is also available in India. They provide their affiliates with a lot of promotion tools and good commissions.

Advantages of Affiliate Marketing
  • Low start-up capital: Starting the entire business process requires only the cost of purchasing website space and domain name, and you can get a return of several thousand or even tens of thousands of dollars per month.
  • No need to hire employees: In the initial stage of affiliate marketing, you can handle all your business by yourself. As your business grows, you can outsource your work to others.
  • No professional experience: If you are promoting weight loss and nutrition products, you don’t need to be an expert in nutrition. You only need to have a long-term learning mentality to promote quality products to the right target users.
  • Online merchants get free ad space and will only pay for proven results.
  • Affiliates require only an ad-space to promote the merchants’ products and thus can enjoy watching the beautiful sunset while earning cash.
  • Advertisers can promote a product to a vast audience, giving their brands more exposure and recognition.
  • Marketers can collaborate with affiliate networks and can pretty much take care of the execution stages, giving the merchant little to no bother during the procedure.
  • Free working hours: a laptop, in the coffee shop or at home to find a place to go online can start working.
Disadvantages of Affiliate Marketing
  • False advertising on the affiliate’s website can destroy a merchant’s reputation.
  • Merchants can suffer from commission costs. Set up and maintenance can also mean more cash outflow for the merchant from having too many affiliates.
  • Affiliates risk not getting paid.
  • There are also some unscrupulous individuals who hijack websites, stealing their commission in the process.
Growth Opportunity
  • 81% Of Brands Use Affiliate Marketing Programs
  • 20% Of Publishers’ Annual Revenue Is Generated Through Affiliate Marketing
  • YouTubers often include affiliate links in video descriptions to highlight the products they mention or the clothes they’re wearing
  • Bloggers frequently place affiliate links within product reviews posted on their blog
  • 16% Of All Online Orders Are Generated Through Affiliate Marketing. Paid search drives 20% of online orders and organic search accounts for 21% of online orders.
  • Jason Stone, better known on Instagram as Millionaire Mentor, generated $7 million in retailer sales between June 2016 and June 2017 through affiliate marketing alone.
    • Source: mediakix