What Is Affiliate Marketing and How Does it Work?

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Affiliate Marketing 101
Affiliate Marketing 101

What Is Affiliate Marketing and How Does it Work?

First of all, before we analyze this subject matter, let’s view how much credibility there is in the arena of Affiliate Marketing online. Here are some of the latest statistics that we have available to us.

Affiliate Marketing Statistics

Affiliate Marketing
  1. 81 Percent Of Brands Have Adopted Affiliate Marketing
  2. “Affiliate Marketing” Search Interest Grew 30 Percent In One Year
  3. 20 Percent Of Publishers’ Revenue Is Now Generated Via Affiliate Marketing
  4. Affiliate Marketing Is Generating 16 Percent Of All Online Orders
  5. One Influencer Generated $7 Million In Affiliate Marketing Revenue In A Year between June 2016 and June 2017.
  6. The Most Popular Affiliate Marketing Category Is Fashion, Followed By Sports, And Health/Wellness
  7. K. Affiliate Marketing Now Drives 1 Percent Of The Country’s GDP
  8. Nearly 50 Percent Of Affiliate-Referred Traffic Came From Mobile Devices
  9. Total affiliate spend in 2017 is predicted to be $5.3B. By 2020, that spend may rise to $6.8B.

These are just a few of the amazing eye-opening statistics that we are seeing in the Affiliate Marketing space. If you are an Internet marketer and not yet involved in Affiliate Marketing, then we recommend that you read this article and get involved. As predicted, Affiliate Marketing will continue to rise in importance and revenue generation.

As well, if you wish to learn more, then we recommend that you go to our JVZOO Academy site ane view what is being offered in teaching and mentoring by one of the world’s foremost Affiliate Marketers, an annual 7 to 8 dollar figure earner.

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What Is Affiliate Marketing

Let’s take a look at this subject of Affiliate Marketing that is sweeping the Internet Marketing ONLINE MARKETING arena. In our business world today, every business works towards making profits. They do this by getting as many customers and clients as possible. In the process, the Market share is of the utmost importance. It reigns supreme.

Affiliate Marketing
Affiliate Marketing

There are numerous means and tactics to increase the market share of a product and drive up sales. One of these ways that is very convenient, preferable, and works very well for many sales organizations in selling their products is affiliate marketing. Many of you in Internet Marketing have some knowledge with the term, Affiliate Marketing. This is because they’ve probably heard it used in many discussions when it comes to selling products. So, in Part 1 of our series on Affiliate Marketing we will be looking at what really is this type of marketing and what does it involve?

In the simplest of terms, we say that Affiliate Marketing is a form or mode of marketing on the internet where the affiliate (this is the person who refers customers), signs up and joins a merchant’s Affiliate Marketing program. For example, Amazon allows those who qualify to join as an Affiliate for free and advertise Amazon’s products, taking a commission on any Amazon product sold that the Affiliate has promoted. The affiliate then continually recommends the merchant’s products to all their customers and anyone else who will listen to their conversation. From this, the affiliate earns a commission on every sale that is made based on their promotions.

Affiliate Marketing
Affiliate Marketing

This concept is similar to what used to be in place before what we know today as internet marketing became mainstream; where sales representatives of these organizations would go out, sometimes door-to-door and get people to buy their products. Then they would be paid a commission for every sale that they made. To one extent or another, this concept of marketing also totally integrates with some internet marketing methods due to the fact that affiliates use conventional methods to generate product awareness. Some of these methods include techniques such as making use of search engine optimization (SEO) tools, email marketing, and PPC, pay per click. You can learn all about these tools and techniques using The JVZOO Academy.

Affiliate Marketing vs. Referral Marketing

However with that said, Affiliate Marketing should never be confused with what is known in the sales world as referral marketing. This actually is often the case, however, the two are very different in their own right. The main motivation or drive behind what we call affiliate programs, is financial gain. The focus here is on a way of driving sales, while what we know as referral marketing, uses personal relationships with customers and the trust factor to increase the number of sales made by the sales representative. By focusing and relying on a loyal existing customer base and business connections/relationships, a business can use these referrals to increase their revenue generation. The difference here In affiliate marketing is that you only get paid commissions when you bring in customers and they actually make purchases of the products you are promoting.

How Affiliate Marketing is Done

This marketing program, Affiliate Marketing, requires that the affiliate or publisher use an affiliate link, the unique affiliate URL that links them personally to the sale, anytime that they mention the selling organization or merchant and their products on their website. These are their own web sites carrying their own personal unique URL supplied by the selling organization. Then when a potential customer or internet “surfer” visits the affiliate’s website and clicks on the unique link or URL, he or she, the customer, is taken to the merchant’s organization website. As well, at the same time, a cookie, or a special assigned unique code to that affiliate gets dropped internally on the customer’s computer.

The customer then goes through the process as laid out on the vendor’s website to purchase the product that they are interested in. As the customer then logs out of the merchant’s web site, the merchant has on their site now this unique cookie that belongs to a specific affiliate. Thereafter the affiliate who introduced the customer to the merchant gets credit for the sale in accordance with the initial agreement even if the customer comes back to the site and purchases the product at a later time..

For both legal and transparency reasons, the merchant creates reports for each affiliate indicating breakdowns and statistics, or what we know as analytics, of the amount of traffic driven from the affiliate’s link and thus the total sales made by that affiliate. This guarantees that the affiliate is paid his or her rightful commissions without being taken advantage of by the merchant.

Affiliate Marketing Payment Methods

Depending on the Merchants payment plans and commission payment systems, the commission payments are typically made after certain time durations, which on most occasions is paid out on a monthly basis. At least that allows the merchant to have the funds available should the purchaser or customer desire a refund on the goods. Most Merchants allow for a 30 day refund period, should the purchaser wish to return the goods purchased through the Affiliate.

Affiliate Marketing
Affiliate Marketing

What we find as the most common compensation method is the one we have described above where the affiliate is only paid commissions on the actual sales that they have made. The other method we mentioned earlier, the cost per click method of affiliate compensation is not actually favored by many merchants. This is because there tends to always be the danger of the marketing program not resulting into reasonable sales numbers. Aa well, an affiliate can also just not really do any work and earn money for actually doing nothing. You will also find that Affiliate marketing is sometimes referred to as performance marketing because of the compensation method used.

Affiliate Marketing Summary

That is it for Part 1 of our series of reports on Affiliate marketing, which we are calling Affiliate Marketing 101. We hope that you did find some value in this set of material, and please stand by for part II which will be released shortly.

As well, we have an amazing Training Site available for you at a very low cost. This site is created and continually updated by one of the 7-figure yearly money earners in the Affiliate marketing space. You don’t have to purchase it now, but I would suggest that you visit the site here and peruse through the amazing training and tutoring available.

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Affiliate Marketing 101
Affiliate Marketing 101

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