Smart entrepreneurs running a thriving business know there’s always more they can do to make that business grow. One way of taking things to the next level is by finding an alternate stream of income. That doesn’t mean starting a second business, but finding ways to complement and grow the business you have by offering more value to your customers and followers.
If you aren’t participating in affiliate marketing, it’s time to consider taking advantage of this lucrative revenue stream.
What is affiliate marketing?
Affiliate marketing is an online sales tactic that lets a product owner increase sales by allowing others targeting the same audience—“affiliates”—to earn a commission by recommending the product to others. At the same time, it makes it possible for affiliates to earn money on product sales without creating products of their own.
Simply put, affiliate marketing involves referring a product or service by sharing it on a blog, social media platforms, or website. The affiliate earns a commission each time someone makes a purchase through the unique link associated with their recommendation. Done well, this performance-based opportunity can become an important part of your business by netting you a healthy income.
How does affiliate marketing work?
To participate in an affiliate marketing program, you’ll need to take these five simple steps:
- Find and join an affiliate program
- Choose which offers to promote
- Obtain a unique affiliate link for each offer
- Share those links on your blog, social media platforms, or website
- Collect a commission anytime someone uses your links to make a purchase
Commission rates vary dramatically, depending on the company and the offer. On the low end, you’ll earn about 5% of the sale but, with some arrangements, you can earn as much as 50%, usually when promoting a class or event. There are also affiliate marketing programs that provide a flat rate per sale instead of a percentage.
Benefits of the affiliate marketing model
Affiliate marketing offers several benefits to affiliates (i.e., you), one of which is its ease. Your side of the equation simply involves handling the “marketing” side of building and selling a product—educating customers. You don’t have to worry about the harder tasks, like developing, supporting, or fulfilling the offer.
Affiliate marketing is low risk. Since there’s no cost to join affiliate programs, you can start making money with an established affiliate product or service without any upfront investment. Affiliate marketing also can generate relatively passive income through commission—the ideal money-making scenario. Though initially you’ll have to invest time creating traffic sources, your affiliate links can continue to deliver a steady paycheck.
Finally, successful affiliate marketing offers the potential to significantly scale your earnings without hiring extra help. You can introduce new products to your current audience and build campaigns for additional products while your existing work continues to generate revenue in the background.
Before you get too excited, know that great affiliate marketing is built on trust. While seemingly there are an endless number of products or services to promote, it’s best to only highlight those you personally use or would recommend. Even when a product interests you or fits within an existing hobby, becoming a great marketer for that product takes a lot of work.
How to find affiliate programs
If you’re wondering how to get your feet wet in affiliate marketing, you’ve got a few options. Not every company offers affiliate programs—some businesses manage their own affiliate programs while others use an affiliate network.
An easy way to find affiliate programs is to visit an affiliate marketplace or platform. Browse your niche to find top performing affiliate platforms. Here are some of the most popular:
- CJ by Conversant
Another option is to visit the websites of the products and services you use and like to see if they have an affiliate program. Large companies often have programs they promote on their site, such asAmazon Associates or theShopify Affiliate Program.
You also can take a more direct approach. Reach out to the owner of a great product you come across and see if they offer an affiliate marketing program. If they don’t, they might be happy to set up an arrangement with you, such as offering you a special coupon code to share with your followers. The best deals often are found when you’re the first to inquire and have a relevant distribution channel, such as approaching the seller of a new fitness product if you’re a health and wellness blogger.
Affiliate marketing programs will have terms of service you need to follow, so read the fine print. For example, your link usually will have a cookie with a specified timeframe, and some programs don’t allow you to purchase pay-per-click ads using the product or company’s name.
Choosing your first affiliate program
As you brainstorm products or browse through affiliate platforms, the most important criteria to keep in mind is that the product should be aligned with your audience, or the audience you hope to build. Ask yourself, is it something your target audience would find valuable? Does it fit with your area of expertise?
A food blogger probably wouldn’t promote beauty products, for example. A wide range of other products would make more sense, such as cookware, meal kits, gourmet ingredients, or even aprons.
Also make sure the product or service you’re promoting is a fit for the platform you’re promoting it on. For example, home decor and clothing are well suited to image-heavy platforms like Instagram. However, if you’re promoting more in-depth purchases, like software, your review may convert better on longer-form platforms, like a blog or YouTube.
Creating a plan to promote your affiliate offer
As we mentioned earlier, affiliate marketing revenue eventually can become a form of passive income, but you still have to do some heavy lifting up front. The success of your program will depend on the quality of your review.
To create a good review, it’s best to get personal. Share your experience in your blog, social media post, or video. If you’re writing a personal review, give a candid opinion based on your experience with and knowledge of the product. The more open you are, the more authentic you will be. People will be more comfortable following your advice if they feel they can trust you.
Trust is a key factor in your affiliate marketing efforts, because people need to trust you enough to act on your recommendations. The level of trust you’ll need to make affiliate sales depends on your industry and the products you’re recommending—for example, it takes more trust to be an effective affiliate for a $1,000 course than it does for a $20 t-shirt.
Beyond just sharing your experiences, you can build trust by limiting the number of affiliates you promote, or by only becoming an affiliate for products you personally use, and sticking to your area of expertise. For example, people trust my recommendations for Canadian financial apps, but that doesn’t mean I’m going to have much luck as a Sephora affiliate.
—Desirae Odjick, founder of Half Banked
Talk to a product expert
Another option is interviewing others who use the product or service, or even interviewing the person who makes or sells it. This can give your review more depth, creating a narrative for the reader.
Create a product tutorial
While your success with affiliate marketing can depend on the overall size of your following, another way to drive higher-converting traffic is by providing a tutorial on the offer. People often perform “how to” searches on Google, such as “how to save money for college” or “how to decorate a laundry room.” If you offer a tutorial that solves a searcher’s problem and clearly showcases the value of the product, your referrals will make more sense in context and you’ll provide the customer with a stronger incentive to purchase the product you’re recommending.
Find relevant search terms
If you’re promoting an offer through a blog post, research which keywords someone might use in a search engine to find an answer to a related problem.Google Ads Keyword Planner is a good tool that can help. (It’s free to use, but you’ll need to create an account.)
Consider your angle
Depending on your offer, figure out how much energy you should invest in instructional or tutorial content, which is often a natural lead-in to someone trying a product for themselves. For example, you could record a video of yourself using and getting the most out of a physical product, or showing off the benefits of a digital product, like software. Unboxing posts are popular, so if you receive the product in the mail, document your experience opening it up.
Set your distribution strategy
Once you’ve written your promotional content, share it on your website or social media platforms. If you have an email list, you can create an email marketing campaign. And be sure to have an affiliate marketing hub on your website with a Resources page where you share a quick list of all of the tools you use and love.
Try offering a bonus
Sometimes marketers promote their affiliate programs by offering bonuses to anyone who purchases the offer. For example, you could give a free ebook you wrote to any follower who makes a purchase. Promotions like this encourage customers to buy by sweetening the deal. They’re especially persuasive if the bonus you offer is something you normally sell, because then shoppers can see its actual dollar value added value right on your site.
You can find several examples of affiliate bonuses in action when business coach Marie Forleo opens her popular B-School for entrepreneurs each year. To encourage sign-ups through her affiliate link, Laura Belgray, Forleo’s own copywriter, offers a one-on-one copywriting session as a bonus. Marketing coach Amy Porterfield adds a bonus bundle, with an invitation to one of her live events, access to a private Facebook group, Q&A sessions, and a variety of downloads. Adding a bonus can be a good way to stand out if several other affiliates are promoting the same product.
Keep things legal and above board
Don’t forget to disclose to followers that your post contains affiliate links. For one thing, it’s required by the FTC. But explaining the reason for your affiliation also can help you connect with your audience. For example, the financial independence bloggers at Frugalwoods offer this disclosure: “Frugalwoods sometimes publishes affiliate endorsements and advertisements, which means that if you click on a link and buy something, Frugalwoods might receive a percentage of the sale, at no extra cost to you. We only write about, and promote, products that we believe in. We promise not to tell you about stuff that's dumb.”
If you need help figuring out what language to use in a disclaimer, it’s worth taking time to consult a lawyer.
Examples of businesses using affiliate marketing
Looking at some of the companies that participate in affiliate marketing will provide you with inspiration—as well as proof that this is a legit and lucrative revenue stream.
Wirecutter, a site promoting gear and gadgets—from kitchen tools to travel gear—that was acquired by The New York Times in 2016, says it only makes recommendations after “vigorous reporting, interviewing, and testing by teams of veteran journalists, scientists, and researchers.”
BuzzFeed Reviews started out as a gift guide and expanded into reviews of various product categories. What makes the site unique is that it covers a variety of ordinary items, giving top picks at three different price points. BuzzFeed’s reviews are quite thorough, which provides lots of value to the reader. Here’s arecent post on toilet paper and another on women’s white t-shirts.
Ready to get started with affiliate marketing?
Earning money with affiliate marketing programs can be a rewarding way to add a new revenue stream without taking on too much risk. All it will cost you is your time. By investing the hours upfront, you can continue to reap the rewards.
Click here to learn how to join the Shopify Affiliate Program.