Are you struggling to expand your customer base and generate more sales? Affiliate marketing could be the answer. It is a powerful marketing tool that enables brands to reach a new audience and boost revenue. Affiliate marketing works by partnering with content creators, bloggers, and influencers to promote their products or services to a target audience.
If you’re curious, keep reading to discover how to use affiliate marketing to optimise your brand exposure and revenue. It could be the ticket to seeing your sales soar when done properly!
Affiliate Marketing Defined
If you want to start affiliate marketing as part of your business arsenal, it’s important to understand what this program entails first.
Affiliate marketing is finding an “affiliate” within an affiliate marketing program. The affiliate is responsible for promoting your product or service through their channels, which can either be in a blog or social media post. They will be assigned a unique affiliate link or a custom code that enables the affiliate marketer to track down the results of their affiliate partners, either through the number of unique visits to the brand website or through conversions. However, the ideal result of the affiliate transaction is a sale.
For affiliates, joining an affiliate marketing program is the best way to earn income online. You do not have to create your own products. Instead, you will be promoting products from existing brands. You must recommend the products you are affiliated with in your blog or social media to entice your followers to support that product.
It means selecting the people or organisations to join your affiliate network for the brands. Your affiliate networks must align with your brand vision and values. Moreover, they must possess three important qualities: audience, authority, and trust.
First, you must choose your partners in the affiliate network with the right audience. By right, it means it should be the same as your brand’s target market. That way, you can leverage the affiliate’s following to build brand awareness about your product or service without doing the legwork.
The next important aspect of affiliate marketing is authority. You want your affiliate networks to have authority in your industry or niche. For example, it could be a fitness instructor or personal trainer if you are promoting a lifestyle or fitness brand. It could also be a dietitian if you are promoting health and dietary products. You are banking on the authority and credibility of your affiliate partners to generate affiliate sales and establish credibility for your own brand.
How Does an Affiliate Marketing Program Work?
An affiliate marketing program is a digital marketing strategy wherein brand partners work with an affiliate, a publisher, a blogger, or a website owner. The affiliate promotes products or services from the brand on the approved affiliate site, which is determined upon the application to the program. It could be through the affiliate’s YouTube channel or social media platforms.
The goal for the affiliate campaigns varies largely. However, most affiliate site owners who promote products or services for their brand partners can earn passive income for their affiliate sales. Some can also earn a commission when they generate leads. An affiliate marketing program’s fee and commission structure depend on the specific program designed by the affiliate marketers.
Step-By-Step Guide to Affiliate Marketing Program
Here is an overview of the step-by-step process of building an affiliate marketing program:
Step 1: Set up an affiliate program.
The brands set up an affiliate marketing program and determine the commission structure for affiliate partners, terms, and conditions.
Step 2: Encourage affiliate site owners to apply to the program.
The next step is to search for potential affiliates to partner with. Some brands join an affiliate marketing platform where they can access a pool of potential affiliates and apply to the program through that network. It makes it easy to find and connect with an affiliate partner through this platform. You can also use it to review sites and organise your marketing channels in one place.
Step 3: Provide affiliate marketing products and materials.
The brand will provide its affiliate partners with marketing collaterals, such as banners, text links, product images, and more. Any related affiliate marketing materials are provided to be featured on the affiliate sites. It’s up to the affiliate partner how and where to use these marketing collaterals.
Step 4: Affiliate promote products or services.
The affiliate partners within the affiliate networks of a brand can promote their products or services through the website or social media platforms. They must include their unique affiliate link when linking back to the brand’s website so they can be paid when they generate leads or sales to the website.
Step 5: Customer purchases from the website.
Generating an affiliate sale through their unique link can help website owners, content marketing creators, and bloggers to earn a commission from the affiliate marketing program. The commission fee depends on the amount of the sale and the percentage for each sale.
The brand will continue to track any leads or conversions from the link within its affiliate network so that affiliate partners are paid accordingly for every referral.
Is Affiliate Marketing Still Relevant in 2023?
Is affiliate marketing still relevant in 2023? The short answer is yes.
Affiliate marketing remains relevant and a crucial part of any marketer’s arsenal of tools to promote a brand and its products or services. Despite the rise of other forms of marketing, such as influencer marketing, brands should still employ affiliate marketing because of its proven benefits.
In the US alone, the affiliate marketing industry was valued at $8.2 billion by the end of 2022. It has increased by 10% from the previous year, and this trend is expected to continue in the next few years. Expect more brands to allocate bigger budgets toward larger affiliate marketing campaigns and advertisements.
Types of Affiliate Marketing
Affiliate marketing is more complex than it seems. The straightforward process above complicates when you factor in the fact that there are several types of affiliate marketing. Most affiliate marketers employ various methods to ensure they can better optimise their target audience reach and the social influence of their partners.
Let’s break down the three types of affiliate marketing to help you determine the right fit for your goals.
1. Unattached Affiliate Marketing
Unattached affiliate marketing refers to working with an affiliate not part of the brand or company they’re promoting. It is the most common yet least effective type of affiliate marketing.
The affiliate promotes or recommends a product or service on their website or social media platform. The goal is to direct users to the partner brand’s website. They earn a commission for every sale generated through their affiliate link. It is the ideal choice of affiliate marketing for content creators and website owners that want to promote various products or services.
2. Related Affiliate Marketing
Related affiliate marketing is another type of affiliate marketing that involves promoting products or services with affiliate partners in a related niche or expertise. A good example is when a food blogger promotes products or services in the food industry, such as kitchen appliances or baking ingredients.
Their expertise and credibility in the niche make them a voice of authority. Therefore, they can effectively promote the product as it aligns with their existing content and target audience.
3. Involved Affiliate Marketing
Involved affiliate marketing is when the affiliate partner actively promotes the product or service from the brand. Aside from creating branded content, they also run ads on their website and engage with their audience to drive conversions. This is the best type of affiliate marketing campaign that brands seek because the affiliate campaigns and promotions are customised to fit the brand. It is also most effective in converting because of the high level of engagement.
Benefits of Affiliate Marketing
Affiliate marketing has grown in popularity because it offers a wide range of benefits. If you’re an affiliate marketer, you can take full advantage of this program as long as you develop a solid affiliate marketing strategy.
Working with an affiliate enables you to leverage the audience reach for that particular partner. It will help you tap into a new audience base that you were unable to reach before, increasing your brand exposure as a result of the affiliate marketing program.
Generating backlinks to affiliate sites can boost your search engine optimisation performance. You can use the website’s authority to improve your organic search rankings if you work with high-quality sites and affiliates.
Unlike traditional advertising, affiliate marketing is more cost-effective since you only pay a commission for the affiliate sales. Meanwhile, the commission structure is performance-based, which gives partners within your affiliate network added motivation to promote your products or services.
Diversity in Marketing
Affiliate marketing offers various ways to promote your brand to the affiliate’s audience. They can feature your products on their social media platforms or build a dedicated landing page for your products on their website. The diversification increases your ability to generate sales through the affiliate marketing strategy.
Credibility and Trust
Working with affiliates who are experts in their niche can boost your brand’s credibility. Therefore, you must research top affiliates in your industry to ensure you can leverage that partnership to increase your brand authority.
Affiliate marketing is highly scalable. Once certain affiliates bring your brand a consistent sales flow, you can consider partnering with them directly and making them brand ambassadors.
Drawbacks of Affiliate Marketing
Sure, there are advantages to affiliate marketing. But it could also have potential drawbacks that you must be aware of and consider when building your affiliate marketing strategy.
Lack of Control
The only step you have control of in your affiliate marketing program is choosing which affiliates to work with. And this step is highly important because you have no control over how that affiliate chooses to promote your product or service. It can create inconsistencies with brand messaging and hurt your brand reputation.
In addition to the above, your affiliates might resort to using fraudulent activities to trick the affiliate marketing system into thinking they’ve generated leads and sales for your website. For example, they might be involved in click fraud or cookie stuffing. Be aware of these tactics to avoid inflated commission payouts to undeserving affiliates.
There is also a risk of cannibalisation when using affiliate marketing. A common example is when you pay a commission to affiliates for promoting products or services that would have sold anyway, regardless of whether they’re being promoted. Those commission payouts could put a serious cut on your profit margin.
Therefore, you should maintain a relationship with your affiliates to focus on products or services that need a boost in marketing and sales. Hence, affiliates are not trying to cash in on products they know are going to sell!
Successful Affiliate Marketing Strategies for Brands and Marketers
1. Choose the right affiliates
Choosing the right affiliate is crucial to your success with an affiliate marketing strategy. Pick an affiliate who fits your target niche and audience. Matching the affiliate with your products or services is essential to bring authenticity to the product recommendation and drive more sales and leads.
2. Offer Competitive Commissions
A competitive commission can incentivise your affiliates to promote your brand more actively. Some content creators and website owners maximise every possible marketing channel available to them, such as writing posts about your brand, featuring them in their YouTube channels, or mentioning your products or services on social media (post and/or story). It enables the affiliates to make more money with affiliate marketing and brings a steady stream of leads and sales to your business.
3. Offer Creative Marketing Resources
Invest in using high-quality creatives that your affiliates would be inspired to use and share. Use high-quality photos and videos so they can increase engagement on the affiliates’ social media platforms and websites. Visual marketing is a crucial component of digital marketing strategy.
4. Build Relationships
The best way to sustain your affiliate marketing campaigns is to develop meaningful relationships and trust with your affiliates. Think of them as your brand partners. You have this mutual interest and relationship that you must foster to ensure sustainable success.
5. Analyse Data and Insights
Continuously monitor your affiliate marketing results and data to ensure you can improve your current strategies to drive more sales. The data analytics and insights also help to identify gaps in your existing affiliate marketing strategy so you can come up with ways to address those gaps and achieve better results.
6. Leverage Multiple Promotional Channels
Encourage your affiliates to use various channels in promoting your products and services to diversify your reach. It also ensures you maximise traffic and sales performance from your affiliate network.
If you employ the right strategy, affiliate marketing is a powerful strategy and tool for brands. The secret to success with affiliate marketing is in finding the best match of partner to promote your products or services. This approach will enable you to reach a targeted audience and leverage your brand’s exposure to optimise sales and revenue.
Affiliate Marketing FAQs
Why brands should use affiliate marketing?
Brand should allow use affiliate marketing as it allows small and large businesses to build a cost-effective marketing campaign that reaches their target audience and tap into a new market.
What are the disadvantages of affiliate marketing?
The main disadvantage is that there is no guarantee of revenue, and affiliates can hijack links. Therefore, you must invest in researching the best affiliates for your affiliate marketing program to ensure success.
When not to use affiliate marketing?
Affiliate marketing is not ideal if you have a small audience and only a few conversions. The money you spend on affiliate commissions might be better utilised for a more targeted marketing campaign.
What is the success rate of affiliate marketing?
The success rate of affiliate marketing varies from one brand to another. Some report as high as a 42% success rate, but many factors could impact the success rate.
Is it hard to start affiliate marketing?
It has a short learning curve, and you can start affiliate marketing once you have your strategy established. You must invest time in finding the ideal affiliate for the program.