Affiliate Marketing: What is it and Does Your Business Need It?

One of the best digital marketing tactics for companies looking to grow their customer base and boost revenue without spending a lot of money on advertising is affiliate marketing. Regardless of the size of your company, affiliate marketing can provide an affordable means of promoting expansion. However, what is affiliate marketing really, and how can companies use it to their advantage? Let's take a closer look at the idea.

What is Affiliate Marketing?

Affiliate marketing entails collaborating with a more well-known e-commerce platform or brand that draws in the kind of clients you want to draw in and requesting them to tell their audience about your offering. In exchange, you pay them a commission, which is a portion of the money from each sale they make.

Start Your Affiliate Journey!

Let's take the example of having an online store that sells high-end eyewear. Asking a posh lifestyle blog to feature your product in its list of "Must Have Holiday Buys" with a "click to buy" link that takes readers to your website is your strategy. In addition to increasing your chances of generating a sale, your product reaches your target market and is viewed by a wider audience. The owner of the blog also gets paid a commission for each pair of sunglasses that is sold. Gain-gain.

The five benefits of affiliate marketing

• Low financial risk – you only pay commission to your affiliate partner once a sale has been made
• As a small business, you can reach a big audience for a much lower cost than paying for impressions
• If you’re selling a niche product, working with a specialized affiliate partner can help you reach your target audience
• Consumers are more likely to buy a product from you if it’s been recommended by a trusted website or someone they value: almost half of shoppers consider the views of bloggers and editorial content sites before making an online purchase2
• Affiliate marketing can boost your website’s SEO ranking, as it will benefit from the backlinks from your affiliates’ blogs, social pages and websites

How Does Affiliate Marketing Work?

1. Business Creates an Affiliate Program – Companies set up an affiliate program and define commission structures.
2. Affiliates Join the Program – Marketers, influencers, or bloggers sign up to promote the business's products.
3. Affiliates Share Referral Links – Affiliates use unique tracking links to drive traffic to the business’s website.
4. Customers Make a Purchase – When a customer buys a product using an affiliate link, the sale is tracked.
5. Affiliate Earns a Commission – The affiliate receives a commission based on the agreed percentage or fixed amount.

Affiliate marketing is a win-win situation where businesses get more customers, and affiliates earn by promoting products they believe in.

Why Businesses Should Consider Affiliate Marketing

Many companies, from startups to multinational corporations, are leveraging affiliate marketing to expand their market reach. Here’s why your business should consider this strategy:

Cost-Effective Marketing Strategy

Because affiliate marketing is based on a pay-for-performance approach, companies only have to pay commissions when customers make purchases or generate leads. When compared to traditional advertising, this makes it a very cost-effective technique.

Increases Brand Exposure

Affiliates have audiences of their own who believe in the advice they provide. Companies can reach new potential clients who might not have otherwise found their products by collaborating with bloggers, influencers, or industry experts.

Boosts Revenue and Sales

Affiliate marketing enables companies to increase sales and reach new clientele without having to pay for advertising up front. Your chances of making more sales increase with the number of affiliates promoting your goods.

Enhances SEO and Online Presence

Affiliates help you rank higher in search results when they post links to your company on their blogs or websites. The domain authority and visibility of your website can be enhanced by adding more backlinks from reliable sites.

Scalability and Flexibility

Affiliate marketing, as opposed to typical marketing strategies, makes it easy for businesses to grow. As your company expands, you can increase the number of affiliates and change the commission plans as necessary.

How to get started

Find the perfect affiliate partner

An affiliate network should be your first port of call when looking for an affiliate partner. Imagine it as a middleman that will link you (the "affiliate program") with thousands of content producers (the "publishers") who can advertise your goods. These publishers could be anything from social media influencers to bloggers to specialized discount websites.

Affiliate networks function as an "all-in-one" solution, providing you with technical assistance to set up your affiliate program, monitor sales produced, pay your publisher(s) commissions, and communicate performance metrics with you (e.g., sector analysis and customer interaction). You can avoid spending money on extra affiliate tracking tools by signing up for an affiliate network.

Decide on commission

You must decide on a commission rate after selecting an affiliate partner. The publisher will be more motivated to properly market your goods in the most effective manner if you are generous. Additionally, keep in mind that your return on investment (ROI) here extends beyond the first sale; you will acquire access to new clients that you may repeatedly sell to.

Add incentives

Offering clients special offers or discounts is a smart strategy to get them to make a purchase. Think about what you could do to draw in customers. If there is a discount code or limited offer linked, they are more likely to click on the publisher's link to your product.

Track your progress

If your affiliate program is being run through an affiliate network, as was indicated in Step 1, you will already have access to some basic tracking tools to assist you in keeping track of sales earned. However, you can use affiliate program software to operate a tracking program internally if you would rather select an affiliate publisher on your own. 

You can set up rules and policies, add items and creatives, track leads and sales, interact with affiliates, handle payments, and more with affiliate tracking software solutions, which offer the infrastructure and interface required to run your affiliate program.

Of course, there is a cost associated with all of this, whether it be a one-time payment or a subscription, but over time, you might discover that it is more economical than paying an affiliate network a commission.

Three Affiliate Networks to get you started

Affiliate marketing is a great way to generate passive income, and choosing the right affiliate network is crucial for success. Here are three top affiliate networks to help you get started:

7Search PPC Affiliate Program

The 7Search PPC Affiliate Program is a leading PPC-based affiliate network that allows affiliates to earn commissions by referring advertisers and publishers. It provides:

• High commission rates on referrals
• Real-time tracking for performance monitoring
• Multiple payout options for flexibility
• Easy-to-use dashboard for affiliates

This network is ideal for bloggers, digital marketers, and content creators looking for high-converting PPC offers to promote.

CJ Affiliate (Commission Junction)

CJ Affiliate is one of the most well-known and trusted global affiliate networks, offering a wide range of advertisers across multiple industries. Benefits include:

• Access to well-known companies and lucrative affiliate programs
•  sophisticated tools for tracking and reporting
•  Adaptable commission arrangements, such as revenue-sharing and CPA
•  Committed affiliate account support

CJ Affiliate is a great choice for both beginners and experienced marketers looking to work with premium advertisers.

Rakuten Advertising

Rakuten Advertising is a highly reputed affiliate network that connects affiliates with big brands and high-ticket offers. Key features include:

• Trusted by top global brands
• Exclusive affiliate deals and bonuses
• Strong tracking technology for conversions
• Reliable and timely payouts

Rakuten is an excellent option for those who want to promote premium brands and earn high commissions through affiliate marketing.

Affiliate Marketing Solutions for Businesses

Businesses can leverage affiliate marketing solutions to streamline their programs and maximize results. Some of the best tools and platforms include:

• AffiliateWP – A WordPress plugin for managing affiliate programs.
• Refersion – Helps eCommerce businesses track and optimize affiliate performance.
• Impact – An advanced affiliate marketing platform with AI-driven insights.
• Post Affiliate Pro – Provides comprehensive tracking and reporting features.

Using these tools, businesses can automate payments, track referrals, and manage affiliate relationships more effectively.

Is Affiliate Marketing Right for Your Business?

Affiliate marketing is suitable for various industries, including eCommerce, SaaS, finance, and health & wellness. If your business meets the following criteria, affiliate marketing may be an excellent growth strategy:

• You have an online presence and sell products or services.
• You want to increase sales without large upfront marketing costs.
• You are willing to invest in building relationships with affiliates.
• You have the ability to track sales and referrals effectively.

If you’re ready to boost your business with affiliate marketing, consider setting up an affiliate program and partnering with affiliates who can help drive your brand’s success.

Conclusion

By using affiliate marketing businesses may increase revenue, improve brand recognition, and maximize return on investment. Regardless of the size of your business, affiliate programs can help you succeed in the long run. By choosing the greatest affiliate partners, honing marketing strategies, and using state-of-the-art affiliate solutions, businesses can fully grasp the potential of affiliate marketing.

If you haven't started an affiliate marketing program yet, now is the perfect time to look at this scalable and reasonably priced marketing strategy!