What is Affiliate Marketing?
The term affiliate means the one who promotes the product or service. Since the profit margin is remarkable, affiliate marketing is gaining huge popularity. The process of affiliate marketing in India is simple. In these simple steps, you can start the process:
- Research the product you want to sell.
- Promote it through an affiliate network.
- When a consumer buys a product marketed by you or an affiliate you will get a commission for that particular product. Commission rates and profit from the product you sell depend on the performance you have for marketing.
Networking and marketing are the core processes or pillars of your business. We will discuss ways to promote the product and related tips ahead in this article. Your profit and commission from the product you sell depend on the performance you have for marketing.
How Does Affiliate Marketing in India Work?
Let us see how Affiliate Marketing in India works. Whenever a consumer buys a product by clicking on the link you shared, you earn a commission. You earn performance-based rewards that you get paid for when a user takes an action on your link.
For example, you are an online business owner, and you get a decent amount of traffic every month to your website page. Other brands contact you regarding their product. They ask you to associate their product on their website. You can easily distribute affiliate links throughout your business page.
This way, whenever someone clicks on your link, a cookie is generated and stored on their browser. Once a visitor takes an action on that link you will automatically receive an affiliate commission in return.
The cookie helps to locate the seller who sold the product and issue a commission. Even if the consumer decides not to purchase the product immediately, you will be paid for purchasing before the cookie expires. Different cookies have different expiration dates. Different affiliate marketing programs have different business models on which they operate.
Types of Affiliate Marketing
It’s often unclear whether an affiliate marketer has actually used the product they’re promoting or if they’re simply in it for the money — sometimes it may not matter to the customer one way or the other.
But other times, such as with diet services or skincare products, the customer may not trust an affiliate unless they know that he/she has tested and approved the product themselves.
In 2009, renowned affiliate marketer Pat Flynn categorized affiliate marketing into three types — unattached, related and involved — to help differentiate between affiliate marketers who are closely tied to a product versus those who are not.
Here we’ll break down each category to help you decide which route to take.
Unattached.
In the unattached business model, the affiliate marketer has no connection to the product or service they are promoting. They have no expertise or authority in the niche of the product, nor can they make claims about its use.
Typically, an unattached affiliate will run PPC (pay-per-click) marketing campaigns, using an affiliate link in hopes that shoppers will click it and make a purchase on their own.
While unattached affiliate marketing may be attractive due to its lack of commitment, it’s generally for those who simply want to generate an income without investing in the product or customer relationship.
Related.
A happy medium between unattached and involved, related affiliate marketing is for those who don’t necessarily use the product or service, but who are somehow related to the niche audience. These affiliates often have some sort of influence in the niche and an established following, and can therefore offer some authority.
For example, perhaps you’re promoting a clothing brand you’ve never used before, but you have an audience through a fashion blog or YouTube channel. In this case, you would be considered a related affiliate marketer.
The advantage of this type of affiliate marketing is that the affiliate has the expertise to generate traffic, however they may risk recommending a bad product or service if they’ve never actually used it before, potentially costing them the trust of their audience.
Involved.
As the name suggests, involved affiliate marketing describes those who are closely tied to the product or service they’re promoting. The affiliate has tried the product themselves, trusts that it will provide a good experience and has the authority to make claims about its use.
Rather than relying on pays per click, involved affiliate marketers use their personal experiences with the product in their marketing efforts, and customers can trust them as reliable sources of information.
Of course, this type of affiliate marketing requires more legwork and time to build credibility, but it will likely result in greater payoffs down the road.
How Do Affiliate Marketers Get Paid?
A quick and inexpensive method of making money without the hassle of actually selling a product, affiliate marketing has an undeniable draw for those looking to increase their income online. But how does an affiliate get paid after linking the seller to the consumer?
The answer can get complicated.
The consumer doesn’t always need to buy the product for the affiliate to get a kickback. Depending on the program, the affiliate’s contribution to the seller’s sales will be measured differently.
The affiliate may get paid in various ways:
Pay per sale.
This is the standard affiliate marketing structure. In this program, the merchant pays the affiliate a percentage of the sale price of the product after the consumer purchases the product as a result of affiliate marketing strategies. In other words, the affiliate must actually get the investor to invest in the affiliate product before they are compensated.
Pay per lead.
A more complex system, pay per lead affiliate marketing programs compensates the affiliate based on the conversion of leads. The affiliate must persuade the consumer to visit the merchant’s website and complete the desired action — whether it’s filling out a contact form, signing up for a trial of a product, subscribing to a newsletter or downloading software or files.
Pay per click.
Affiliate marketing is largely about generating traffic to websites and trying to get customers to click and take action. So, the myth that affiliate marketing is all about SEO (search engine optimization) is no surprise.
However, while organic traffic is free, SEO simply can’t sustain affiliate marketers in such a saturated market — which is why some affiliate marketers utilize PPC.
PPC (pay per click) programs focus on incentivizing the affiliate to redirect consumers from their marketing platform to the merchant’s website. This means the affiliate must engage the consumer to the extent that they will move from the affiliate’s site to the merchant’s site. The affiliate is paid based on the increase in web traffic.
There are two common concepts in PPC:
- CPA (cost-per-acquisition): With this model, the affiliate gets paid each time the seller or retailer acquires a lead, which is when an affiliate link takes the customer to the merchant’s online store and they take an action, such as subscribing to an email list or filling out a “Contact Us” form.
- EPC (earnings-per-click): This is the measure for the average earnings per 100 clicks for all affiliates in a retailer’s affiliate program.
Pay per install.
In this payout system, the affiliate gets paid each time they direct a user to the merchant’s website and installs a product, generally a mobile app or software.
So, if a retailer budgets for a $0.10 bid for each install generated via an affiliate program, and the campaign results in 1,000 installs, then the retailer will pay ($0.10 x 1,000) = $100.
Why Be an Affiliate Marketer?
Passive income.
While any “regular” job requires you to be at work to make money, affiliate marketing offers you the ability to make money while you sleep. By investing an initial amount of time into a campaign, you will see continuous returns on that time as consumers purchase the product over the following days and weeks. You receive money for your work long after you’ve finished it. Even when you’re not in front of your computer, your marketing skills will be earning you a steady flow of income.
No customer support.
Individual sellers and companies offering products or services have to deal with their consumers and ensure they are satisfied with what they have purchased.
Thanks to the affiliate marketing structure, you’ll never have to be concerned with customer support or customer satisfaction. The entire job of the affiliate marketer is to link the seller with the consumer. The seller deals with any consumer complaints after you receive your commission from the sale.
Work from home.
If you’re someone who hates going to the office, affiliate marketing is the perfect solution. You’ll be able to launch campaigns and receive revenue from the products that sellers create while working from the comfort of your own home. This is a job you can do without ever getting out of your pajamas.
Cost-effective.
Most businesses require upfront startup fees as well as a cash flow to finance the products being sold. However, affiliate marketing can be done at a low cost, meaning you can get started quickly and without much hassle. There are no unexpected fees to worry about and no need to create a product. Beginning this line of work is relatively straightforward.
Convenient and flexible.
Since you’re essentially becoming a freelancer, you get ultimate independence in setting your own goals, redirecting your path when you feel so inclined, choosing the products that interest you and even determining your own hours. This convenience means you can diversify your portfolio if you like or focus solely on simple and straightforward campaigns. You’ll also be free from company restrictions and regulations as well as ill-performing teams.
Performance-based rewards.
With other jobs, you could work an 80-hour week and still earn the same salary. The good thing about affiliate marketing is that it is purely based on your performance. You’ll get from it what you put into it. Honing your reviewing skills and writing engaging campaigns will translate to direct improvements in your revenue. You’ll finally get paid for the outstanding work you do!
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Common Types of Affiliate Marketing Channels
Most affiliates share common practices to ensure that their target audience is engaged and receptive to purchasing promoted products. But not all affiliates advertise the products in the same way. In fact, there are several different marketing channels they may leverage.