Meaning of Affiliate Marketing

Marketing strategies are useful in promoting a company's product and helping to boost sales. Affiliate marketing is a marketing strategy that companies implement to generate sales and stimulate web traffic. Understanding what affiliate marketing is can help you develop and apply successful marketing strategies to help your business succeed. In this article, we will discuss affiliate marketing, why affiliate marketing is important and how to become an affiliate marketer.

What is affiliate marketing?

Affiliate marketing is a process in which a person, the affiliate, earns a commission for marketing a company's products. An affiliate finds a company's products that they enjoy and promotes those products on their website, social media accounts or other media platforms. When members of the affiliate's audience purchase the product using specific links or promotional codes, the affiliate receives compensation for helping generating sales and traffic to the company.

There are different types of affiliate marketing channels used to promote certain products, including:

Influencing

Influencers have a significant social media following and can directly impact the buying decisions of thousands or even millions of consumers. The more followers an influencer has, the more they can benefit from affiliate marketing because a large group of people is likely to see their affiliate posts. Influencers interact with their followers through web posts, social media posts, blogs and vlogs, among others.

Blogging

Bloggers use a company's products or services and write reviews to persuade their readers to make purchases. They use affiliate links in their posts to bring sales traffic to the company's website. They specialize in search engine optimization (SEO) techniques as well as other marketing strategies that are aimed at generating web traffic.

Email marketing

Many affiliates use specific marketing campaigns to collect a list of email addresses, and then send emails to those addresses concerning what it is that they are promoting. Another emailing strategy is for the affiliate to send out email newsletters or information regarding certain products. Every email includes affiliate links readers can click on to purchase the products.

Affiliate marketing parties

For an affiliate marketing strategy to be successful, three different parties must work together including:

Company

The company is responsible for creating, producing and distributing the product to consumers. For the product to become profitable, the product should be in demand, useful and of good quality. The company may choose to advertise their products themselves or seek the assistance of an affiliate whose audience most closely matches their target consumers.

Affiliate

The affiliate can be a single person or an entire company that is responsible for marketing the product in a way that appeals to large sums of consumers. Affiliates tend to have a particular and distinct niche whom they market goods and services to, which helps the affiliate attract consumers who are most likely to buy products that meet their needs.

Consumer

The consumer helps determine how affiliate marketing strategies are implemented. The consumer visits the affiliate's social media page, website or blog and sees information regarding the product. If a consumer buys the product, both the company and the affiliate share the proceeds, thus benefiting both parties.

Why businesses use affiliate marketing

Businesses may use affiliate marketing for numerous reasons, including:

• Building a brand

• Creating excitement around a new product

• Using performance-based pay structures

• Boosting sales and growth

Building a brand

A company's brand is very closely related to its reputation. To build a reliable brand that customers love, a company can use the influence of affiliates to create awareness about the brand and to appeal to a wide audience. Additionally, affiliates can help a business promote its products.

Once a company is well-established and customers view it as a reputable brand, they are likely to be loyal to that brand. To compete in their market, businesses should also diversify their affiliates to ensure that they are reaching as many customers as possible.

Creating excitement around a new product

Companies can use affiliate marketing to create excitement for new products or around a product launch. Affiliates can use affiliate links on their websites, which will help drive demand for the product.

Businesses can also send out promotional offers through their affiliates. For example, sending out a promotional offer on Black Friday or Christmas is a great way to get potential customers excited about your products.

Using performance-based pay structures

In an affiliate marketing strategy, the company has control over the affiliate's compensation. In this way, affiliate marketing can be a cost-effective marketing strategy because a business will pay the affiliates when a sale is made through their affiliate links. Businesses can trust that they are paying only the affiliates who receive the most web traffic and ultimately contribute to the company's sales and growth.

Boosting sales and growth

Using an affiliate marketing strategy helps to guide prospective customers to a company's website, which can help boost sales. When a business uses trusted affiliates to help target customers, it can create brand loyalty among these customers. Creating a reliable, in-demand product that customers love can also lead to customers returning to purchase from the company again, further increasing sales and growing the brand.

Read our full Course