Affiliate Marketing explained- The easy way.

Why this article is in desperate need? 

Affiliate Marketing- This is the word that is creating a lot of hustle and bustle in the digital marketing world. Affiliate marketing is not new in the digital space or anywhere in the world. We have been a part of this so-called program since the inception of goods. In this article, I will explain about affiliate marketing and its insight. After reading this article you will have an idea of how you can start your own affiliate journey.  

Definition of Affiliate Marketing 

You can find many definitions of affiliate marketing on the internet. I have found the below definition simple and easy to understand.  

“Affiliate Marketing is promoting/advocating products and services created or provided by others to get part of the profit from products or services offered by seller or service provider."  

There are other definitions of Affiliate marketing as below. 

“A marketing arrangement by which an online retailer pays commission to an external website for traffic or sales generated from its referrals.”- Definitions from Oxford Languages 

“Affiliate marketing is the process of earning a commission by promoting other people's (or company's) products. You find a product you like, promote it to others and earn a piece of the profit for each sale that you make.” -Neil Patel 

“Affiliate marketing is the process by which an affiliate earns a commission for marketing another person's or company's products. The affiliate simply searches for a product they enjoy, then promotes that product, and earns a piece of the profit from each sale they make.” - Definition by Adam Enfroy 

Real-life examples of Affiliate Marketing 

Let's take an example from our life. You are visiting a doctor for some health issues. He is done with the formal checkup and now it's time to prescribe you the medicine. The doctor has many medicines in his mind where the ingredients are the same. But he will only prescribe medicines that are giving the best profits to him. He will also suggest to you the drug store from where you should buy the medicine.  

Here you are unknowingly part of the whole affiliate system as a consumer who is paying the price for the medicine. You can consider Doctor as an affiliate of medicine manufacture as well as the chemist who sells these drugs. 

Let's take another example. You bought a new iPhone and you are happy with its features. You found this phone better than anyone else in the market as it over-delivers the value.

Now one of your friends just discussed with you about his/her plan to buy a phone. You will immediately recommend him/her to buy iPhone as you are already using it and it's better than other mobile phones in the market. 

You recommended the iPhone to your friend so you acted as an affiliate but unfortunately, you will not get the commission as you are still not a part of that affiliate system in monetary terms. 

These examples show that affiliate marketing is part of our life for a long but the term may seem new for us. 

 Evolution of Affiliate Marketing

 

The concept of affiliate marketing on the Internet was conceived of, put into practice, and patented by William J. Tobin, the founder of PC Flowers & Gifts. Launched on the Prodigy Network in 1989, PC Flowers & Gifts remained on the service until 1996. By 1993, PC Flowers & Gifts generated sales in excess of $6 million per year on the Prodigy service. In 1998, PC Flowers and Gifts developed the business model of paying a commission on sales to the Prodigy Network.

In 1994, Tobin launched a beta version of PC Flowers & Gifts on the Internet in cooperation with IBM, which owned half of Prodigy.^[10] By 1995 PC Flowers & Gifts had launched a commercial version of the website and had 2,600 affiliate marketing partners on the World Wide Web. Tobin applied for a patent on tracking and affiliate marketing on January 22, 1996, and was issued the U.S. Patent number 6,141,666 on Oct 31, 2000. Tobin also received Japanese Patent number 4021941 on Oct 5, 2007, and U.S. Patent number 7,505,913 on Mar 17, 2009, for affiliate marketing and tracking. In July 1998 PC Flowers and Gifts merged with Fingerhut and Federated Department Stores.

Amazon.com (Amazon) launched its an associate program in July 1996: Amazon associates could place banner or text links on their site for individual books, or link directly to the Amazon home page

Source: wikipedia

 

Category of products

 

There are basically two broad categories of products in affiliate marketing. Physical and digital. 

Physical products are the one which can be touched and felt by in its physical form. However digital products are used by consumers in digital form. 

There are a wide variety of physical products in the market. Books, clothes, grocery items, gym equipment, beauty products, health care products, and equipment are some of the examples of Physical products. 

Online courses, Softwares, and online study are some of the examples of digital products.

 

Affiliate commissions on products 

Companies provide a wide variety of commission range as per the product cost and profits. This commission is part of the profit from the product sale. 

In the case of physical products, the commission ranges from 2 to 10% of the product cost. Commissions are low as more resources and money is invested in producing and procuring the products. But the demand is high as these products are in use in day-to-day life. 

In the case of digital products, commissions are high. It ranges from 20%-80%. Some products offer 100% commission on the products. Commissions are high in such products as they are reusable. The creator of the product put his resources at once in creating products. Once the course/software is ready, it can be reused. This is the main reason for the high commission of these products. 

 

How the affiliate marketing system works 

To understand the ecosystem of affiliate marketing, we need to look into the below image. 

 

                                                               Source:JustLearnWP.com  

 

We can understand the above process in the below steps.

•  You as an affiliate share the details of the products or run an ad about the product on your website/blog/social links. 
• Customer or visitor clicks on your sponsored ad or link.
• Customers will be routed to the product website with your affiliate link. Tracking is being done in the background.
• The user makes a purchase by doing the payment on the website for the product.
• Purchase is tagged to your affiliate account.
• The company will confirm the sale or the purchase.
• The transaction is linked to your affiliate account after verification and validation.
• Finally, you will get your commission to your account. 

These are the basic steps being followed by most companies. Some companies have a threshold amount after which they will send you the money. There can be some fixed dates also as per the company policy to send the affiliate commissions. 

Why Affiliate Marketing the business stands out in the market?

There are many benefits of the Affiliate Marketing business that makes it unique. Some benefits of Affiliate Marketing business are specified as below. 

Hassle-Free: You need not to set up a new business or course. There is a course/product which is already created by someone for you.  

Zero investment: Some of the products or affiliate sites allow you to promote their products free of cost. You need to full fill a few prerequisites in terms of account and valid documents. 

No age limit: There is no restriction on your age. You can start your affiliate business at any age.  

Work as per convenience: You can work from any part of the world or in any time zone. You only need an internet connection and a device to connect. 

Risk-free business: It is completely risk-free. You need not to invest a huge amount in the capital like other businesses. You only need to invest your time and efforts. 

Popular affiliate programs in India 

There are many programs in the market that pays good commissions on their affiliate program. 

1. Reseller Club

2. Flipkart Affiliate

3. Amazon Associates

4. vCommission

5. BigRock Affiliate

Source: digitaluncovered

 

If you want to learn about affiliate marketing in detail. I would suggest joining one of the best courses. You can more details here.

 

Summary

 

If you are looking for extra income by working 2-3 hours a day, an affiliate marketing business will work for you. You need to optimize all your social medial accounts to get more leads and sales.