How Does Affiliate Marketing Work

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what is affiliate marketing

How does Affiliate Marketing Work?

Affiliate Marketing is one of the most tried and tested methods to make money online, but how does it work, and can you really make money from it?

You may already know this, but nearly all of the big media organisations do it – newspapers, online magazines and comparison sites all use Affiliate Marketing to increase their revenue. The great thing is, anyone with a laptop or smartphone can do it. It’s just a case of knowing how to start.

The screenshot below comes from a national British newspaper – each laptop featured in the article contains affiliate tracking links to Amazon and other stores. Newspapers and other media outlets use Affiliate Marketing as a means of generating extra revenue.

newspapers do affiliate marketing

Is Affiliate Marketing worth it?

Affiliate Marketing is definitely worth it, but it certainly isn’t as easy and straightforward as some might have you believe. The truth about Affiliate Marketing is that you will only succeed if you view it as a business, and you put your heart and soul into it.

Sadly, I have heard from many different industry sources that 99% of people who try Affiliate Marketing, fail to make any meaningful income from it (if any income at all). The main reason quoted is that they quit too easily or aren’t committed enough.

affiliate marketing requires commitment and focus

Any new business can take a good couple of years to get off the ground, and Affiliate Marketing is no different. Sure, there are short-cuts like paid ads, Solo Ads and so on. But these require investment, and if you are like I was at the beginning, I had very little spare cash to invest, so I had to take the long road.

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What is Affiliate Marketing?

Affiliate Marketing is the process whereby an Affiliate promotes a product or service to an audience (leads) with the ultimate aim of generating sales for their client. For this service, the affiliate is paid a commission – this can be anywhere between 3% for a physical product like a bicycle through to 50% or even 70% for a digital product.

how does affiliate marketing work chart
Most successful Affiliate Marketers will choose a particular niche. This could could be anything from Fishing through to Health and fitness.

The most profitable niches tend to be tried and tested and have a broad appeal. Then there are new or emerging niches, that may not be particularly popular at the moment, but have a good potential for growth in future.

Most of the popular niches solve a problem, like how to lose weight fast or how to make money online. I would personally go for a niche that has a broad appeal and hence a larger audience.


How to get started in Affiliate Marketing

#1 Choose a niche

The first, and possibly the most important step to take in Affiliate Marketing is choosing a niche. This is particularly important, because your choice of niche will have a big impact on your future earning potential.

question mark what niche should i choose

It can be a bit overwhelming deciding which niche to choose. If it is too obscure, then you may not get enough traffic to generate any meaningful income, if it is very popular then there will be a lot of competition, usually from well-established affiliates or large media organisations.

This shouldn’t put you off, because the great thing about affiliate marketing and the internet in general, is that it’s incredibly dynamic – there is always room for someone new with a different perspective on things.

A good starting point is a niche you have personal experience with – this may be a hobby, a sport or any passion you have. This is important, because it will be difficult writing about or promoting something you aren’t really interested in.  You will also need to do some thorough niche research, to determine how viable it is.

Think about yourself, your lifestyle, your experiences. We all have something of value to share with the world, and providing value is the key to success.

The most popular niches solve problems, whether someone is looking for a suitable diet program or a Golf player is looking for a new set of clubs. The reason people search the internet is because they are looking for answers.

problem solving is at the core of affiliate marketing

The process goes something like this:

  1. Buyer intent – an individual is thinking about purchasing a particular product or service. This may be a physical product like a new pushchair, or a digital product like a diet program, software or eBook.
  2. They will perform a search relating to that product on either Google, YouTube or Social Media.
  3. If you can get your particular Affiliate offer in front of that individual, then you stand a good chance of making a sale and earning commission.

This may sound straightforward enough, but the reality is somewhat different. Affiliate Marketing is a highly competitive industry and in order to succeed you will need to build your audience, and gain their trust by providing valuable content and advice relating to your chosen niche. Putting up affiliate links here and there on Social Media, and doing a couple of YouTube videos isn’t going to do the job.

You need to focus on building yourself up as a brand, an authority within your niche. If people trust your judgement, then they are much more likely to make a purchase via one of your links.

keep your audience happy and you will succeed

Try looking at it from the point of view of the customer. If you went on a review site for a particular product or service and the content was vague and and poorly written, it is unlikely you would make a purchase.

If, however the content was well-written, concise and provided value, you would be much more likely to purchase through a link on that site.

cpontentThere are many success stories, of people starting off from scratch and very rapidly rising up through the ranks to financial freedom in a relatively short time. And although this isn’t typical, it certainly is possible.

Most successful affiliate marketers started off where you are today. They have spent many years building their business through hard work, trial and error, dedication and fine-tuning their methods in order to get the kind of results that we all dream of.


Niche Research

This is one of the fundamental pillars of Affiliate Marketing. If you do not spend time thoroughly researching the viability of your niche, then you may end up disappointed.

Thankfully, there are lots of free tools available nowadays that make this whole process a lot easier.

Google Trends

is a fantastic free analytics tool, and you can gather lots of data regarding the volume of searches performed and the location these searches were performed in. It is important to know the geographical location of your intended audience and Google trends can provide this and lots of other useful metrics.

In the screenshot below, I typed in the search term ‘Ketogenic Diet’ which is very popular at the moment. As you can see from the graph, there was a steep rise in searches near the end of the 12 month period.

google trends screenshot

The screenshot below shows the top 5 countries these searches were performed in – very useful indeed, when deciding on your target audience.

google trends screenshot geographical data

Keyword research tools

Keyword research tools can help you get a better idea of the search volume, and competition of the types of phrases people enter into search engines like Google when looking for a product or service.

Keywords Everywhere

Is a pay-as-you-go browser extension, available for Chrome and Firefox. Once installed, every time you type a search term in, whether on Google, Youtube, eBay or Amazon, the keyword search volume (per month) will be displayed, along with a competition score and an estimated cost per click (if you were to promote that keyword through Google AdWords). Keywords Everywhere costs $10 per 100,000 searches.

KwFinder

This is another excellent keyword research tool. There is a 10-day free trial available, and the starter plan is around $30 per months, but you get access to other very useful analytics tools as well. These will provide even more data, like average monthly searches and keyword competition scores – these give you an insight into how many other websites are ranking for that particular search term.

Generally the higher the competition score, the more difficult it will be to rank your website on the first page of Google. Ideally to want to search for keywords are yielding moderate to high monthly hits, but have a low competition score.

Ubersuggest

Is an excellent free keyword analytics tool, developed by Neil Patel, one of the Affiliate Marketing industry leaders. Ubersuggest is an excellent tool to use and can provide you with masses of data relating to niche keywords.

SEMRush

SEMrush is an amazing analytics tool. This tool is used by the pros, and the paid version isn’t cheap at $99 per month. But if you’re serious about Affiliate Marketing and can afford the outlay, it will definitely pay for itself many times over.

You can find out everything you need to know about your competitors. What keywords they are ranking for. Their traffic, where it comes from and how many backlinks they have. You can also an get an in-depth analysis of your own website, which is really useful.

Jaaxy

Jaaxy was developed by the team at Wealthy Affiliate, and is their in-house keyword research tool, available for premium members of the program. It can also be purchased separately by non-members. I use Jaaxy frequently, as I am a member of Wealthy Affiliate.

The screenshot below shows search results for ‘best exercise bike’.

  • Avg is the average monthly searches performed on Google, Traffic is the approximate number of visitors to your site if you manage to rank on the first page of search results.
  • QSR is your keyword competition score, this will give you an idea of how easy or difficult it will be to rank an article on the 1st page of Google based around certain keywords – Ideally, this needs to be under 50.
  • KQI is Keyword quality indicator and SEO is based on traffic and competition, the higher the score, the more likely you are to rank higher in the search engines.

jaaxy keyword research tool

As you can see from the above results. Best exercise bike weight loss, best exercise bikes for weight loss and best exercise bike knee problems have a reasonable search volume, but a low competition score and high SEO score. The keyword best exercise bike has a high monthly search volume but also a high competition score, making it more difficult to rank high on Google.

Remember, that some keywords do always make sense and It is important that the words you later put in your blog  are grammatically and contextually correct.

When doing your research on Jaaxy, you can save these keywords to a list and then export the list to a spreadsheet. Very handy for referencing when you are building your site / blog.


10 of the Best Niches for Affiliate Marketing

As I have discussed previously, choosing your niche, and doing thorough niche research is very important. Below is a list of 10 of the best niches for Affiliate Marketing.

It is worth noting that there are always many sub-divisions within each niche. For example: If you decided to go for a popular niche like diet and weight loss, you could focus your blog on what natural supplements are best for losing weight or what exercises can help lose weight the quickest. The potential to promote products within each niche is enormous!


#1 Diet and weight loss.

The Diet industry will always been very lucrative. It has been around for decades – long before the internet came along! and it is more popular than ever.

Diet and weight loss niche
There are an overwhelming array of diet programs available, and plenty of sub-niches within the diet industry to explore. To be an authority in this niche it would be ideal to have a good understanding of nutrition. Maybe you have been on a weight-loss journey yourself and wish to share your experiences with others.

#2 Pregnancy and new mothers.

Another very popular niche, that will always have massive demand (for obvious reasons!). Raising a child can be difficult at the best of times, and we are seeing a trend of more parents having children later on in life.

pregnancy and new mothers niche
There are so many different sub-niches within this, that there seems to be a never-ending supply of different products to promote to your audience. If you are a parent yourself you may be able to share your experiences with others, and offer valuable help or advice in the form of a blog.

#3 Mental Health (particularly depression).

It is a sad, but unfortunate fact that more and more people are suffering from depression, brought about by the stresses and strains of modern living.

mental health and depression
Depression falls into many categories, and a lot of us can offer some experience on the subject, particularly if you are battling depression yourself. You could start a blog and use it as a creative outlet to offer help, inspiration and hope to others in your situation.

Things like Yoga, exercise, healthy eating and natural supplements can all help with depression and anxiety.


#4 Make Money Online.

As job security goes out the window and wages stagnate, there are a lot of people looking to escape the monotony of a 9 to 5 job that offers little satisfaction and barely pays the bills.

make money online
There are so many ways you can start a productive business from the comfort of your own home and start to earn money online. This could be doing what I am doing and promoting affiliate marketing, starting an e-commerce store or selling on Amazon or eBay.

#5 Dating.

The way we date has been completely changed by the internet and now there are a multitude of free and paid platforms designed to help individuals meet their perfect partner.

dating niche
The dating industry is worth over $2.5 billion in the U.S. alone, so has a huge potential for affiliate marketers.

#6 Pets.

If you have a Dog, Cat or other pet, you will understand that there is a huge market for pet products online, ranging from Nutrition, toys, tracking devices and digital products on training etc.

woman and dalmation dog
People are always passionate and caring when their pets are concerned and promoting particular products within this niche is always going to yield results.

#7 Hobbies.

Golf, Fishing, Cycling, Sports… The list goes on and on. If you have a passion for a particular activity, then it may be worth turning that passion into a living.

,an fishing in the sunset
Imagine being a keen golfer, and being able to promote and review products that you use. The other benefit of this, is you probably already have a circle of friends within your hobby, who you could promote products to.

#8 Gaming.

The gaming industry is continuing to grow steadily. E-sports have been growing steadily in popularity for years but recently have become a global phenomena, where people compete professionally.

gaming niche
The are opportunities to make money playing video games, as well as promoting all the hardware and gaming guides. If this is something you have a passion for it is certainly worth looking in to as the earning potential within the gaming niche is massive.

#9 Survival.

Another popular niche that has a huge following, as well as many sub-niches to explore. This includes hunting, basic survival skills, camping equipment, outdoor clothes etc.

man shooting a longbow

#10 Nootropics.

Are a really hot topic at the moment. They are a range of supplements (some synthetic and some natural) that may promote increased brain function and help with memory, productivity, focus, anxiety etc.

smart drugs
Some of these supplements are backed up by solid scientific evidence, and some are not. But there is a growing number of people, particularly in the tech industry and students who swear by their efficacy.

#2 Choose your Platform

You have chosen your niche, and now you need to focus on building your platform and attracting your audience. Then, and only then, should you start adding affiliate links.

There are a multitude of ways to promote an Affiliate products, but it is worth noting that most affiliate networks will require you to have an active website.  Your website is important as it gives credibility to you and your unique brand.

The other important thing you will need is a consistent stream of good quality traffic (website visitors). There are many ways to get traffic to a new website, some are free, others are paid (like Facebook ads). The best type of traffic comes from search engines like Google, but it can take a number of months for a new site to start ranking high.

The methods I have listed below are all tried and tested ways on how to make money in Affiliate Marketing:

Blogging

A blog is basically your brand. It represents you, the person. Your knowledge, expertise and passion for your niche. It is the place people will go looking for answers to questions. If you write, high quality and well structured content then it becomes a powerful tool by which you can earn an income.

Direct Email marketing

 A lot of people question the ethics of email marketing. We’ve all been there. You sign up for something online, then the next minute you are relentlessly bombarded with emails on a daily basis.

Fortunately, email marketing has come a long way since those days, and the savvy email marketer knows this tactic doesn’t work any more. Email marketing is still a powerful tool in the Affiliates Arsenal, but it needs to be done correctly. I will go into more detail on this subject later in this blog.

Social Media for Affiliate Marketing

No one can deny the power of social media – Facebook, Twitter, Instagram, Pinterest and so on. There are people out there earning six-figure incomes just on Instagram alone!

If you can build your social following, then you have your audience. Unfortunately, it isn’t quite as easy as it used to be.

YouTube for Affiliate Marketing

This is the one! YouTube is massive – did you know that YouTube gets 30 million visitors per day? The power of video is undeniable and anyone serious about Affiliate Marketing needs to have a YouTube Channel.  There are so many video creation tools now available that making a good quality, professional looking video has never been so easy.

But, just as with Google, competition is fierce, and you will have your work cut out for you to get new videos ranking well.


Affiliate Links

When you join an Affiliate program you will be able to generate tracking links for the products you are promoting. A tracking link will contain your own unique Affiliate id, so when a sale is made through that link, it will be credited to you.

You can place your affiliate links either in the form of a hyperlink within the text of your product review, and also in product photographs. It can also be used in a ‘call to action’, for example: “Find out more” or “Buy here”.  An affiliate link may look something like this: https://[destination].com/product=[productid]track_id=[youraffiliateid].

The great thing about these links, is once they are ‘clicked on’ and your visitor is redirected to the destination website, tracking cookies are placed on their computer.  This means, if your referral doesn’t make a purchase straight away, but they return to the website at a later stage and make a purchase. You will still be credited with the commission (even if they purchase a different product or multiple products).

Some Affiliate programs like Amazon associates only have 24 hour cookies,  Aliexpress Affiliate cookies are 3 days, and some Affiliate networks even have cookies that last for up to 30 days. I have earned lots of commission on products totally unrelated to my niche before, which is a great bonus!


What is Passive Income?

The idea behind passive income is you’re earning enough money on autopilot to have more free time to do the things you enjoy.

But true passive income can only achieved after you have put in many months or even years of hard work. Your blog can be thought of as a piece of digital real estate. Once you have consistent traffic that is regularly earning you a decent living. Your website or blog can run on autopilot, making you money as you sleep, while taking the kids to school or spending time on the beach and so on.

a passive income will give you more time to spend with your family

As time goes by you will still need to be active on your blog by adding regular content, engaging with your audience and updating older posts to keep your blog relevant. But once you have a good well-established blog, your earnings will allow you more time to do the things you enjoy – no more monotonous 9-5, spending time stuck in traffic on your way to work, or being crammed into public transport on your daily commute.

Once your website is earning you a good income, you can start thinking about outsourcing work, and having other contributors write articles for you. You could even build multiple blogs and these in turn will earn you even more money  – the possibilities are endless!


Conclusion

So there you have it! I think I’ve covered most topics relating to how to get started in Affiliate Marketing, but if you have any further questions, please leave them below in the comments section and I will do my best to answer them within 24 hours.

The next stage of building a successful career in Affiliate Marketing  is choosing a platform from which to promote products or services for a commission. I will be primarily focusing on blogging, but I also be going into more detail on other successful tried and tested methods to make money in Affiliate Marketing.

[Read More… How to Start a Free Blog]

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