Affiliate marketing can be described as outsourced marketing. It’s a process that involves you hiring a third party who is compensated for bringing business to you.

Affiliates will typically use a blogs, email newsletters, and videos to drive customers to your website; however, they only get paid when visitors convert into customers. Driving traffic to your site may be a plus, but conversions are what drive your business. This is what affiliate marketing is all about.

The purpose of generating traffic is to get more customers. If your website gets a million visitors a month but your visitors never make a purchase, then all your efforts would be pointless. With that said, the monetary risk when using affiliate marketing is quite low when compared to the potential rewards, since affiliates are only paid once a customer makes a purchase or converts.

Because all your affiliates have incentive for sending valuable visitors your way, they will put in place measures to send you only the most qualified prospects.

affiliate marketing budget

How Affiliate Marketing Works

Most affiliates will send visitors your way through advertising a link, button or banner in their content. You can use these avenues to track visitor data to your site.

When starting out, you will need a tracking URL to determine which affiliates are driving your traffic. Affiliates can market your company using a number of means. The most effective methods are:

  • Paid traffic, e.g., Google AdWords
  • Blog posts
  • Email blast
  • Product reviews
  • A YouTube video of your product and link with the affiliate ID

There are many ways for affiliates to promote your products. As a general rule, you should limit the number of avenues your affiliates use to market your company and products. Keep in mind that affiliate programs are not the same as referral programs.

If your website has a referral program and a customer invites his or her friends to visit your website, the customer can receive some sort of reward through the program. This is different from affiliate programs because affiliates don’t need to be customers and they can be recruited in any fashion.

The Benefits of Affiliate Marketing

Small businesses have a lot to benefit from affiliate programs. Here are few advantages:

  • You only pay for results.
  • It’s one of the most cost-effective marketing programs today.
  • Affiliates are very good at reaching segments and creating copy: after all, why would anyone sign up as an affiliate if they don’t think they can drive you customers?
  • You have plenty of tools to calculate return on investment. It’s useful for finding out whether you are earning or losing cash.
  • There’s very little chance of suffering losses. Affiliates have every reason to send you customers, so this minimizes risk.

Become an Affiliate Member

If, rather than set up an affiliate marketing program yourself, you want to earn as an affiliate member, here are steps you can follow.

Select your niche

Select your niche in affiliate marketing

One common mistake people new to affiliate marketing programs do is they promote too many products and services. This is a mistake. It actually makes it more difficult to generate relevant, sustainable traffic that translates to consistent growth.

Formulate your plan around the type of content you prefer and are able to produce, and then work on creating a comprehensive plan for promoting the most relatable in-demand products in your niche.

Create valuable content

A good affiliate plan takes the focus away from the basic pay-per-click strategies and on to content promotion, making sure to target a suitable audience through engaging content.

The only way to forge lasting relationships online is by committing to deliver quality, useful content that your readers can find engaging, enlightening, and applicable. This is what will keep your visitors coming back for more.

Set up a multi-channel promotion platform

Search engine optimization and online copywriting are essential components of a successful affiliate campaign, particularly when searching for new traffic; but, a cross-channel marketing plan gives you more exposure, allowing you to forge deeper relationships with core audiences.

As you go about promoting content on social media and developing a communication list for direct email marketing, your goal should be to get all of your individual campaigns working in tandem to give you a wider audience to promote your brand to.

As a modern marketer, you should feel compelled to pay attention to the legal framework that governs the way business is conducted online.

In order to be avoid federal violations, there are specific guidelines affiliate marketers must be compliant with.

Successful marketers embrace the role of regulation as a safety element for the consumer. Disclosing regulations to your affiliates builds more trust and support from their audiences. One way to make sure your affiliates are complying is if they endorse your business because they believe in it.

As a participant in one of these programs, you should learn what the latest FTC regulations allow; it’s also important to understand that all entities involved in a compensated relationship are required to make full disclosure.

Selecting Affiliate Marketers

There are 3 common types of affiliate marketers:

Unattached Affiliate Marketing

Unattached affiliate campaigns are the kinds where there is no authority behind the product from the affiliate. There’s little to no connection between the affiliate marketer and the end consumer. It boils down to the affiliate just putting an affiliate link for people to click through with little care given to the incentive for why they should.

This style of affiliate marketing is attractive to many because there’s little effort involved. On the flip-side, it takes time and dedication to build a connected following online. If you blog, you’re often putting a lot of thought into which articles you publish and what information you give out. For the large majority, this just isn’t the case. A lot of people don’t have time to manage a blog; therefore, they opt to enable pay-per-click campaigns and include the affiliate links in hopes to get paid for minimal work.

With this model, affiliates tend to be more focused on income than providing value to audiences.

In this category, affiliates have an online presence through blogs, websites, social media, podcasts and more. They offer affiliate link sponsorships related to your niche; however, they don’t use your products. That means there’s no personal attachment to your products.

There’s a good chance when you opt-in for this type of sponsorship, you’ll have some success. Success could come from website banner ads or small endorsements posts for your product, paired with links. Although, the success may not last very long. Someone who doesn’t know your product inside and out can only ever give an adequate endorsement. People need to be convinced if they are to buy something. Most people trust their friends and families because they are sources of credibility. If you only half know a product, you won’t have enough credibility to sell. You need to be an authority for you to have selling power.

In addition, if you promote a product you don’t use or know well, you could lose your trust with your audience. People may distrust you for convincing them to buy a product out of line with their expectations of your brand. It only takes one bad experience to ruin your reputation.

Work team outing

Involved Affiliate Marketing

Affiliates who are involved with a product or service will drive the most qualified leads to your website. These types of affiliates already believe in your products and services and can personally recommend them to audiences. They won’t skip a beat when it comes to how to get the most out of your product.

When your product is naturalized in the life of an affiliate, it becomes a part of the content they are creating. It fits seamlessly into their topics and gives your business more opportunity to find persuadable audiences, who may become brand loyalists.

This form of affiliate marketing works the best because it’s the most honest. Audiences know it’s hard to find brands they can trust; but, they know people are easy to trust. When you find someone who already uses your product and has an audience, sponsorships will work because you are giving them a job they will enjoy. To these affiliates, they get paid to provide their audience with value from a brand they love. It’s win-win.

Conducting sponsorships with involved affiliates will not only increase their authority and authenticity, but your business’ as well.

What’s New in Affiliate Marketing

Artificial intelligence powered affiliate marketing

IBM and WebGains teamed up to create the first affiliate marketing dedicated chatbot. It uses machine learning technology to guide publishers to find information they need when creating campaigns. It even has the ability to assist affiliates in monitoring their performance and communicating with hundreds of publishers. With time, automated assistance in affiliate marketing will only become more effective, as artificial intelligence is sweeping across the marketing sector.

Mobile and home assistants are expected to dominate search in the coming years; therefore, affiliates will need to begin to optimize their content for voice search. Those who optimize content for the inclusion of more speech oriented search terms and long-tail keywords to be used as voice commands will come out on top.

Affiliate Marketing Key Performance Indicators

measuring affiliate marketing success


Clicks are a good indicator of how many people are interacting with your content. Clicks, by themselves, don’t give us much information; however, when paired with sales numbers, it can help tell us if the affiliate link is working or not working. If you’re receiving a large amount of clicks and a low amount of conversions, there could be low affinity between your audience and the product you’re linking to.

Sales actions

The number of sales gives us information about the rate of new customer acquisition. It’s also an important metric for revenue generation.

Conversion rate

Conversion rate is the gold standard of all key performance indicators (KPI). It’s simply the number of clicks divided by the number of conversions. Conversion rates help you to predict your potential revenue gain as well. Typically, low rates are below 1 per cent and high rates are anything above 10 per cent.

Return on ad spend

Abbreviated to ROAS, return on ad spend is a good indication of an affiliate’s value. You can calculate ROAS by dividing the affiliate’s revenue by the amount of affiliate spend. This doesn’t take into account your organization’s overhead. That would only be included if you were calculating return on investment (ROI).

Cost per click

This measurement is handy when you need to know the average price you pay per each new customer acquisition.

Chargeback Rate

This metric will give you information about the quality of traffic your affiliates are sending to your website. An indication your affiliate is not promoting your product to the right audience can be to see if your chargeback rate is above 10 per cent.

You can calculate your chargeback rate by using your current month’s chargebacks, and divide it by the previous month’s transactions.

Common Affiliate Marketing Strategies

There are two ways you could go as an affiliate. The first option is to create sponsored content surrounding a business’ products. The content would focus on certain aspects of these products where they could provide value to your audience. The second option is to create content, coupled with a discount code or link for purchase. Blending the two types of content creates more longevity for your readership, while giving you a chance to make commissions as well.

Common topics or ideas you could fit into your sponsored posts include:

  • Features
  • Uses
  • Benefits
  • Comparisons

For example, we are an affiliate working on a sponsored post for a blender company. We have to create a sponsored blog post to drive people to the sponsor website and buy a blender. Let’s take a look at our options:

We could talk about the features of the blender including all its different speeds, blend settings, alternate ice crushing modes, and blade design. The features you mention should help to give the product personality to entice your audience with. If you know your audience is expecting more than just perceived valued, talk about the products conventional and alternate uses. Stressing the benefits of a product is where you’ll entice most of your audience. As long as they perceive the benefits as outweighing the costs, they will buy. Lastly, comparisons are effective strategies to use when convincing visitors the value of your product over another.

Match Products with Blog Niche

If announcing your sponsorship is not your forte, you could incorporate content that fits into your blog’s niche. For example, you operate a video game inspired blog. You could include a post about a certain new video game you are excited about, where you encourage your audience to seek out and buy it upon its release. This could work with any product related to gaming including peripherals, laptops, televisions, memorabilia and more.

If you’re looking to get eyes on your content, try buying traffic you can use to send to your sponsor website. Facebook and Google Adwords are great platforms for giving your content a surge of engagement.


The art of upselling is all about encouraging more expensive buys from your visitors. You often persuade them to get the upgraded version of a product or to buy more of it. Additional mentioning of add-on items is an example of upselling.

Only promote products you would actually buy

If you have no interest in a company product, don’t promote it. You won’t have incentive to feature it in your blog or videos. Audiences are savvy and will notice when an integration is unnatural. If you promote a brand where it doesn’t fit, you’ll have a very hard time convincing anyone to buy the product. However, when you’re passionate about a product, you will be able to attract audiences who can see your passion about it and; thereby, potentially build a passion for it themselves.


Once you have a responsive website complete with quality products or services, start an affiliate marketing program to ensure a steady income stream from various sources at a low cost to you.