How to Make Money with Affiliate Marketing

How to make money with affiliate marketing

Learn how to make money with affiliate marketing. 

If you are just starting out, then understanding how to make money online is important. There are many ways to make money online. But affiliate marketing is my favorite.

There are 3 ways to make money as affiliate marketer.

But first…

What is Affiliate Marketing?

Affiliate Marketing is a process where a person (affiliate) earns commissions by selling other people’s or company’s (retailer) products and services to consumers.  Most commissions are paid on a “pay per sale” basis. The amount is a percentage of the sales price. The percentage varies depending on the retailer and product. Your goal as an affiliate is to send visitors to the retailers’ websites and if the visitor buys something, you earn a commission (it varies between 1 – 75 percent or more depending on the program).

Basic affiliate marketing process – Once you sign up to be an affiliate of a retailer, promote the retailer’s products and services using the promotional material and links provided by the retailer.

Step 1 –  The consumer searches for a needed or desired product or service and finds your promotional material.

Step 2 – The consumer visits your website and views your content related to the product or service. If the consumer has enough information, they will decide to buy the product by clicking on your affiliate link taking them to the retailer’s website.

Step 3 – The consumer buys the product or service from the retailer. The retailer ships the product or provides the service to the customer. 

Step 4 – The retailer pays you the commission for the sale to the consumer.

The following infographic shows the basic process.

Infographic on how to make money with affiliate marekting

​The above affiliate marketing infographic shows the process with a website. The following will discuss the 3 methods used to make money with affiliate marketing.

3 Ways to Make Money as an Affiliate Marketer

Here are three ways to make money in order of preference.

  1. With your own website
  2. Without a website
  3. With someone else’s website

Creating your own website is typically referred to as a passive method of earning revenue. It is passive in the sense that potential customers come to you by searching for information using search engines, primarily Google. For example,

Google SERP showing product search

In this case, is a participant in the Amazon Services LLC Associates Program.

Making money without a website or using someone else’s website are not passive methods. They both require extensive advertising or promotional efforts. Promotional efforts may include:

  • Build an email list – Use an email marketing system and collect email addresses to send periodic emails discussing problems and offering solutions.
  • Use social media – Share the challenges of finding solutions to pressing problems. Share results you have achieved using products. For example, use Twitter (#overweight) to find people with weight issues and then recommend a weight loss product solution.
  • Personal networking – Word-of-mouth is a great way to share solutions to problems with friends, family and acquaintances.
  • Paid advertising – Use paid advertising sources like Google Adwords or Facebook ads to promote specific solutions to your target market.
  • Banners – Use the banners provided by the retailer and post to your website or post to banner ad sites.
  • Create videos – Create videos using testimonials to review products and post to YouTube or other websites.

Some companies provide their affiliates with replicated sales pages. It is difficult to make money when there are thousands of affiliates all promoting look-alike ​promotional pages. 

A vendor to its affiliates is like a forest to its trees.

Which tree is yours?

A forest represents a vendor with thousands of affiliates like trees

Benefits of Affiliate Marketing

​There are a number of benefits to affiliate marketing. The benefits include:

  • Easy entry – It is a matter of identifying and applying to an affiliate program. Having a website is not required.
  • No skills necessary – The larger affiliate programs and networks provide training to get you started.
  • Low risk – It does not cost to join an affiliate program.
  • Focus on advertising – The retailer (merchant) is responsible for the sale and delivery of the product of services. Your responsibility is promoting the retailer’s products (via product links).
  • Back office support – The retailer provides the back office support, accounting, tax reporting and other administrative functions.

Affiliate Marketing Disadvantages

​Affiliate marketing is not easy for a number of reasons.

  • Commission rates vary – Commission rates can vary anywhere from a couple of percent to 75% or more (typically software or digital products have the highest commission rates). Commission rates also vary from retailer to retailer. Depending on product competition, retailer profit margins are razor thin. Consequently, commission rates are low.
  • Competition – Because of easy entry and low risk, there are a lot of people competing in affiliate sales. And they are competing against experienced affiliate marketers.
  • Product reputation – Product and retailer reputation is important to success with affiliate marketing. Low quality may result in product returns and chargebacks. It is not uncommon for retailers to hold off paying commissions for 30 days or more. I recommend checking the retailer Better Business Bureau ratings and customer satisfaction reports or complaints. Look for retailer and product reviews via the search engines.
  • Product demand – If the demand for a product is not there, no sales occur. And no commissions are paid. 

Affiliate Marketing Summary

Affiliate marketing is one of the most popular ways to make money online. Because you do not have to create your own products. You simply provide useful information to help solve people’s problems.

Successful affiliate marketing is all about relationship building, identifying problems people have and offering solutions.

If you have questions or comments, please fill in and submit the form below. I love ​comments!

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