What is Affiliate Marketing

Affiliate marketing is a performance-based marketing strategy where a business rewards one or more affiliates for each visitor or customer brought by the affiliate's marketing efforts. In simpler terms, it's a way for individuals or businesses to earn a commission by promoting other people's or companies' products or services.

6/9/20211 min read

Here's how it generally works:

  1. Affiliate: This is the person or entity that promotes products or services belonging to another company or individual. Affiliates can be individuals, bloggers, influencers, or companies.

  2. Merchant: Also known as the advertiser or the retailer, this is the company that sells the products or services. Merchants engage in affiliate marketing programs to expand their reach and increase sales.

  3. Affiliate Network (Optional): In some cases, there's an intermediary between the affiliate and the merchant called an affiliate network. These networks manage the relationships between affiliates and merchants, track sales, and handle payments.

  4. Tracking Links: When an affiliate joins an affiliate program, they receive a unique tracking link or code that identifies them as the source of the referral.

  5. Promotion: Affiliates promote the merchant's products or services using various marketing channels such as websites, blogs, social media, email newsletters, videos, etc. They incorporate their tracking links in their promotional content.

  6. Commission: When a visitor clicks on the affiliate's tracking link and makes a purchase or completes a desired action (such as signing up for a service or filling out a form), the affiliate earns a commission. The commission amount is predetermined and varies depending on the merchant and the product.

  7. Performance Tracking and Payment: The affiliate network or the merchant tracks the performance of each affiliate, including clicks, conversions, and sales. Affiliates are paid commissions either on a per-sale basis, per-click basis, or based on other predefined actions, usually on a regular payment schedule.

Affiliate marketing offers benefits for both merchants and affiliates. Merchants can increase their sales and brand exposure without upfront marketing costs, while affiliates can earn passive income by promoting products or services that align with their audience's interests. It's a popular and effective marketing strategy used across various industries.