Affiliate Marketing

What Is Affiliate Marketing And How Does It Work?

Affiliate marketing, although complex on a deeper level, is actually a very straight forward concept on the surface.

A lot of new people get intimidated by terms such as “Search Engine Optimization” and think they cannot learn the skills needed to be successful.

In this article we are going to look at the basic concepts and how it actually works.

I am also going to try address some of the myths that are usually encountered when first researching affiliate marketing.

So, what is affiliate marketing and how does it work?


What Is Affiliate Marketing?


First of all, let’s address what affiliate marketing actually is.


Since the amazing growth of E-commerce, companies now acquire significant amounts of their revenue via online sales.

This trend is set to grow with no end in sight.

After all, let’s face facts, the internet will continue to grow and will be around in an ever increasingly complex form in the future.

It is part of all our daily lives in one form or many.

It can be online banking, paying your bills, entertainment, education, social lives, entertainment, and of course shopping.

Whatever the case, the internet is here to stay, and so is affiliate marketing.


Online marketing has become very competitive.

As the money potential has grown, so has the competition to grab as much of the pie as possible.

Due to this, online advertising such as pay per click, has become far more expensive than it once was.


So, companies have realized for quite a while, that web traffic equals revenue.

A lot of companies have started to hire people to build teams that specialize in online marketing campaigns.

It is not uncommon now to meet people who have job titles such as “Online Marketing Director” or “Social Media Specialist”.

For example, here is a video from the Marley Baird Media YouTube Channel.


As the social media marketing industry grows so will the competitiveness, and guess what that means?

The people who are truly good at it will be able to charge more than the newcomers and therefore the price will rise for results.

Granted the average wage will drop, but those that produce results will expect more pay than those that do not.

In time, social media specialists who produce will become very expensive.

After all, if someone can produce millions of dollars in revenue per year they will sell their services to the highest bidder.

Fair logic?


So, that brings us to affiliate marketing.


Affiliate marketers get paid solely on results.


If they generate sales and leads etc, they earn a commission or bounty.

If they do not produce, then they do not earn money and do not cost the company a penny.

There are no wages for affiliate marketers.


This is a VERY attractive offer for companies.


It is also VERY attractive for affiliates.


Because there is no earnings cap, or results quotas to meet, or bosses to answer to etc.

They are their own boss.


Their sole job is to refer traffic to products.


In it’s basic form, it can be described like this.


A company has products on it’s website.

They either join an affiliate network to manage their program for them, or start their own “in house” affiliate program.

When they join the program, they are given access to various promotional materials such as banners and referral links to products.

They then start to promote the companies products on their blogs and social media using the banners and referral links.

Anytime someone goes through the links or banners, the special code built into them informs the company that a certain affiliate referred the sale.

They will then receive a commission or bounty for the sale.


If an affiliate program pays 10% commission and a blogger refers $50,000 in sales to the company.

The blogger will receive 10% of the $50,000, which is $5000

How To Do Affiliate Marketing


Affiliate Marketing can be done in a variety of different ways, usually used in combination.

Typically, an affiliate will create a blog on a certain topic (also called niche) and create content, such as articles, that discuss various aspects of the topic.

The affiliate will then join an affiliate program related to their topic.


Jenny creates a blog based around the topic of home decor.

She writes lots of articles about the topic and includes links and banners from the affiliate program.

She then promotes her articles on social media.

The articles get a lot of readers and quite a few decide to click on the links to the products she suggests.

The readers are sent to a third party website that sells the products.

Any sales that are made that are from Jennies readers who clicked through the links, earn her a commission.


*Note that the price of the products are exactly the same as if the readers had gone straight to the website themselves without Jennies links.

It does not cost the customer any more money just because they were referred by an affiliate.

That is how affiliate marketing works in a nutshell.


Some affiliates get very creative with how they refer customers.

If you have ever watched review videos on YouTube, you will notice they usually say something like “I have included a link in the description if you ant to go take a look”

These are almost always affiliate links.

This is why they do the YouTube product based review videos in the first place.

The affiliate is showcasing the product, and effectively pre-selling the product to the viewer.

When the video is finished, the link to the product is right below so the viewer can go and purchase it without having to search around the internet.

The customer will not pay a penny more than they would if they had gone direct to the website.

But the affiliate will earn money if the viewer purchases any products from the company after clicking through the link.

*Most programs will pay a commission on any product purchased by a customer referred to the website, not just the single product advertised by the affiliate.


Some affiliates rely on social media traffic and organic traffic, while others may also use pay per click advertising.

Organic traffic.


Organic traffic are people who visit a blog/website from search engine results.

When you type a search request in a search engine, Google for example, you are given a list of results.

This list of results are websites and social media pages usually.

However, it may also be images and videos.

When you then click on a link to a blog, or social media page, image, etc, you are then classed as an organic traffic visitor.

As you can imagine, competition to be the highest ranking result for some keywords is extremely fierce.

A keyword is what you type in as a search engine request.


If you type in “Best place to learn affiliate marketing”

The two main keywords in that phrase are “learn affiliate marketing” and “affiliate marketing”

Both of those are very competitive and can produce a lot of organic traffic.

A “Long tail” keyword would be “Best place to learn affiliate marketing”

The practice of getting your blog/website to rank highly for keywords is known as SEO (Search Engine Optimization)

SEO is a complex topic and too detailed to go into fully here, but I will link to where you can learn SEO at the bottom of this article.

Pay Per Click (PPC)


Pay per click is paid advertising.

I’m sure you have been on websites or blogs, and increasingly social media, and seen various ads on the page.

Some maybe fixed ads and others may be short video ads.

What happens here, in most cases, is that the advertiser bids on keywords and pays an amount of money each time the ad is clicked.


A Laptop computer company may run a PPC campaign that targets keywords such as “Laptop”

The suggested bid may be $3.

So, each time someone clicks on that ad and they are transferred to the companies website, it will cost the company $3.

The company will pay the $3 just for the click whether the customer ends up buying anything or not.

Some keywords can cost as little as a few pennies a click.

Others can be upwards of $50.

It all depends on how competitive the keywords are and how much competitors are bidding on them per click.

Some affiliates will research keywords that are cost effective and advertise using PPC.

Instead of referring the reader straight to the company website, they will refer them to their own blog first.

Usually to a product review article on their blog that contains affiliate links that then refer the reader to the products on the company website.


PPC can be very effective, but also very expensive.

It takes a lot of research in order to use PPC effectively, otherwise it can literally be money spent for nothing if the readers do not convert into referrals after they reach the blog.


The biggest PPC network in the world is Adwords which is owned by Google.

Here is a video from the Google Ads Youtube Channel.




I have written an article here that goes into greater depth on how to do affiliate marketing


Can Anyone Do Affiliate Marketing?




There are people as you read this article making money from affiliate marketing.

There are full time Affiliate Marketers, Stay at home Mom’s, Students, Retirees.

Just about anyone can make money online if they are prepared to learn the skills needed and put in the effort required.




I will get into how to learn the skills below and I have also written an article about the type of people that do affiliate marketing


Can You Actually Make Money?


There are people who are making a LOT of money.

There are also plenty of people who have replaced their jobs to go full time online.

Quite a few people also use it as a way to make extra money to have more income or to even pay down debts etc.

The honest truth is that three major factors will dictate how much money you can make.

Choice of niche (topic).


Some niches have very high priced products and great commissions.

Luxury items such as watches and jewelry are a good example of this.

Yes, there are affiliate programs for luxury goods!

There are programs for pretty much anything you can think of.

Other niches may have lower priced items, but are also easier to get people to purchase online.

Health supplements such as protein powder for example.

Each niche will also have its own level of competition.

Some will only have a few affiliates and their blogs to compete with in search engine results.

Others will have fierce competition with literally thousands of affiliates all competing for readers.

Do not let that discourage you however, as the more people competing usually indicates the bigger the reader, and financial, pie they are fighting over.

Billions of searches per day are processed by search engines, you can always get a slice if you know how.

Effort and Dedication.


Affiliate marketing is NOT a get rich quick scheme as some would lead you to believe.

It takes time and effort to build up your infrastructure.

You cannot expect to write a couple of articles and post it to social media then be able to quit your job two weeks later to sit on the beach all day.

Some self proclaimed “Gurus” will give you that “song and dance” to try and sell you some pre-packaged course they have created and are peddling.

The truth is, you will need to learn the correct skills and put in the work to utilize them effectively.

You CAN make a lot of money from affiliate marketing, make no mistake.

But as with anything, if you want to be good, you have to learn and practice.

You cannot expect to be a gold medal winning athlete without training and dedication.

You cannot expect to be a millionaire without applying the same logic to affiliate marketing.

Can you make a lot of money….Yes…. More than you probably realize… A lot more…

Correct Training.


As I have mentioned, you will need to acquire the correct skill set to be successful.


Here are ways I suggest to get that training.

Affiliate Marketing Training




How to learn affiliate marketing



Read the affiliate marketing for beginners article



Learn about Wealthy Affiliate

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