How does affiliate marketing work? – 6 easy steps to success

It is already some time ago that I last wrote about financial freedom. I just saw that I have 239 days left to win my 365 Days Financial Freedom Challenge. This is not a lot, especially if you consider that I set myself the goal to earn 10,000 EUR per month as from 15 April onwards, but I still think it is possible.

And I believe my key to success lies in AFFILIATE MARKETING.

Why that? Because affiliate marketing offers a good way to earn steady amounts of passive income once you have everything in place. But let’s start at the beginning.

What is affiliate marketing?
Affiliate marketing is a popular method of promoting web businesses in which an affiliate (you or me) is rewarded for his or her efforts to direct visitors, subscribers and/or customers towards the merchant. An affiliate is therefore the online middleman between the customer and the merchant.

Compensation takes place based on a certain value for each visit (Pay-per-click), registrant (Pay-per-lead), or a commission for each customer or sale (Pay-per-Sale).

Compensation varies depending on which of the above-mentioned agreements you have made with the merchant. If you have a Pay-per-Sale agreement for example and you are an affiliate for a physical product, you would usually receive between 3 to 10 % from the sale price, depending on the merchant and the product. If you are offering intangible products like an e-book or an e-course you could even receive up to 80% of the sale price! From the other hand, it is also much more difficult to sell intangible products.

How does affiliate marketing work?

  1. You decide which product/service you would like to promote. You might be most successful if you looked for a niche product with low competition.
  2. Once you determined the product or service, you can look for merchants who offer an affiliate program for that product or service. Meanwhile there are 10,000’s of companies on the internet that are willing to pay a performance-based commission to people who drive sales to their websites. Sites as Commission Junction or Linkshare bring affiliates and merchants together. If you don’t know which product or service to promote, it can also help to surf around these sites for some inspiration of what is out there.
  3. Once you have found a suitable merchant, you can join his/her “affiliate program”. Usually you have to fill in some personal information such as address, website address and information, bank account details etc.
  4. Based on the information you fill in, the merchant will decide if you can join the program. This can take a few days. My experience is that you will be accepted as an affiliate unless you do some illegal or crazy things on the internet.
  5. Once accepted, you will receive personalized links or adds you can promote on e.g. your site or blog.
  6. If you have a Pay-per-sale agreement with the merchant you will only receive a certain commission once a customer has bought the product or service through your personalized link.

Advantages Merchant
Less client detection and marketing activities necessary since (potential) customers are found and sent through by the affiliates. Moreover no payment is due to an affiliate until results are realized.

Advantages Affiliate
You can set up a business with relatively small or even no costs at all. You don’t have to buy products, you don’t need to store them, you have no transportation costs, no insurance costs, no risks….  The only thing you need is internet access and maybe a website. And of course the ability to direct (potential) customers to the merchant.

Currently I am only focusing on Click-per-sale options for tangible products. I’ve already become an affiliate at Amazon and at some other merchants. I will keep you posted about the results….

Do you think this might be something for you too?

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6 Responses to How does affiliate marketing work? – 6 easy steps to success

  1. Henk van der Wijk says:

    Dank voor toezending Anna! Je site ziet er mooi verzorgd uit. Om antwoord op je vraag te geven: affiliate marketing kan aantrekkelijk zijn. Maar alleen als aan een paar voorwaarden wordt voldaan. De belangrijkste: je moet over een bestand aan potentiële klanten beschikken, waarvan je kunt aannemen dat een aanzienlijk percentage interesse voor het aan te bieden affiliate product zal hebben. Met andere woorden: het product moet passen bij de niche die jij kent (interesse) en kunt bereiken (contactgegevens). Ontbreekt een van beide (of beide), dan kan je er beter niet aan beginne, want de inspanning (tijd en geld) weegt dan meestal niet op tegen de beloning. Bovendien: de merchant kan ieder moment z’n beleid veranderen, met de belangen van affiliate partnerts wordt in de regel geen rekening gehouden daarbij. Je hebt dus veel minder controle dan in het geval van eigen producten.

    Groetjes, Henk

    • Anna says:

      Hoi Henk, Dat is inderdaad waardevolle informatie. Dank je wel. Ik moet inderdaad rekening houden met interesse en bereik van mensen. Ben benieuwd hoe het gaat lopen…. Groetjes, Anna

  2. Daniele says:

    Hi Anna,
    I’m really curious to see how it goes with you.
    Surely to make it work (=produce a meaningful income) the blog/website where the adverts are needs to have LOTS of traffic.
    To me lots is something like 10.000 pageview/month… on a blog with a niche topic and good content that can act like an authority that visitors trust.

    Good luck with the experiment and keep on sharing!!!

    • Anna says:

      Hi Daniele, I think it depends on the technique you are working with since I understand there are different ways to approach it. I totally agree with you that you need lots of traffic when it comes to offering intangible products such as e-books or e-trainings to your readers. We’ll see. I am planning to experiment with different techniques and curious to find out what works and what doesn`t…at least for me. Keep you posted! Anna

  3. Jan Casi says:

    How’s the developement going from the moment u set your goal? The goal of 10.000 a month is a pretty high goal. Are u getting anywhere close to it so far and how do u react on setbacks that could demotivate you? Also I really wonder what kinda business you focus on to get a high pay per lead.

    • Anna says:

      Hi Jan,

      Good question. I am still very far from my goal but I still think I can reach it, optimistic as I am :-)
      I focus on affiliate marketing mainly at the moment. Will definitely give an update shortly. Thanks for reminding me.

      Greetings,
      Anna

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