What is affiliate marketing and how does it work?

So what is affiliate marketing and how does it work? Affiliate marketing is simply selling or promoting someone else’s product or service. We often recommend the things we enjoy like a book or a film or a restaurant to friends or family. It’s called referral or word of mouth advertising. The internet enables anyone to refer someone to a product and service and make commissions based on the sales of those products. For each sale which you make for a company by referring a customer to their website, you will earn a commission or sometimes continuous commissions ( in the case of a monthly membership service). Your link is tracked so that the company you are referring customers to can credit you with the sale.

Amazon has an affiliate program and anyone can send them visitors and earn commissions from the sales. Ebay also has an affiliate program. These websites are examples of physical products but you can also sell digital products as an affiliate. Digital products can earn an affiliate up to 75% of the value of the sale. This is because there is no stock to hold, there are no employees and the digital products can be downloaded instantly once purchased. The affiliate, therefore is doing the job of bringing the customers through the ‘door’. Because of this and the low costs for an internet based business, the affiliate can be paid a much larger proportion of the sale than would be possible in a ‘bricks and mortar’ business where there an many other costs to consider.

Affiliates can earn a full time income and even leverage that income once they have a successful campaign to scale up. By building websites, landing pages, creating adverts and building content, affiliates can gather traffic to send to affiliate products and services. By selling them they earn commissions. The beauty of an internet business is that once all this is set up, more and more customers can be sent through a ‘sales funnel’ to create multiple sales. It is a 24/7 business which can operate even when you are not on your computer. For this reason, many affiliates can build a fully portable lifestyle around their affiliate business simply by selling other people’s products online.

To learn more about starting your own affiliate business check out this video made by Stuart Ross.

Typically affiliates start by writing a blog and promoting their links through it. They find customers/visitors through the Google search engine. The best way to start earning quickly is by selling digital products through building a list. Once you have a sales funnel in place you simply send more people through the funnel and work on developing your sales technique and targeting the right market for your products. Take a look at this quick video which I created which gives an overview of affiliate marketing.


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