What is affiliate marketing?

Affiliate marketing is a performance-based marketing strategy in which individuals or organizations (affiliates) promote products or services on behalf of a company (merchants) and earn a commission for each sale, click or action generated through their marketing efforts. This is a mutually beneficial arrangement where affiliates help drive traffic or sales to the merchant and in return they receive a share of the revenue generated from the referred customers.

Here's how affiliate marketing typically works:

Affiliate Selection: A merchant sets up an affiliate program and invites individuals or other businesses to become affiliates. These affiliates can include bloggers, website owners, social media influencers or anyone with an online presence.

Affiliate Promotion: Affiliates choose products or services from merchant offerings to promote. They may use various marketing channels like websites, blogs, email newsletters, social media platforms, and even paid advertisements to promote these products or services.

Unique Tracking Link: Merchant assigns unique tracking link or affiliate ID to each affiliate. These links are used to identify which affiliates referred customers.

Customer Engagement: When a potential customer clicks on an affiliate link and lands on the merchant's website, a tracking cookie or code is placed on the visitor's device. This cookie helps track customer activity, such as making a purchase or signing up for a newsletter.

Conversions and Commissions: If the referred customer performs the desired action, such as making a purchase, the affiliate is credited with the sale and they earn a commission. Depending on the terms of the affiliate program, the commission can be a percentage of the sales volume or a fixed amount.

Payments: Affiliates receive their earned commissions on a regular schedule, often monthly. Some affiliate programs may have minimum payout thresholds that affiliates must reach before receiving payments.

Merchants can expand their reach and increase sales without incurring upfront marketing costs. They pay when they see results.

Affiliates have the opportunity to earn passive income by promoting products or services that align with their niche or interest.

It is a flexible and scalable model that can be adapted to different industries and business sizes.
However, successful affiliate marketing requires more than just sharing affiliate links. Affiliates need to create valuable content, build trust with their audience and effectively promote the product or service to maximize their earnings.

Overall, affiliate marketing is a popular and effective way for businesses to increase their online sales and for individuals or businesses to generate income through their online presence and marketing skills.