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Exploring Affiliate Marketing Basics

How Affiliate Marketing Can Help Your Business

What if we told you there was a way to market your product that involved low start up costs, low time and effort and low risks while providing you with high ROI and growing your business and brand awareness?
 
Seems too good to be true? Not if you know your target audience inside and out and have the know-how to select the best possible representatives for your brand!
 
We’re here today to introduce you to the world of affiliate marketing.
 

What is affiliate marketing?

Affiliate marketing is a tactic used by brands to drive sales. It often words in tandem with other marketing tactics as part of a larger campaign.
 
This tactic typically involves a partnership between an affiliate and a retailer to promote the sale of their product on a commission-based model. The affiliate will promote the product using a unique link that drives trackable traffic to the company’s website. If a consumer makes a purchase through the affiliate link, the affiliate is paid a percentage of the sale. 
 
 
But wait, you think. Every time that fitness influencer I follow offered me a discount on protein powder, they were trying to SELL ME SOMETHING? Yes, and so was the fashion influencer generously offering you a discount on a company’s clothes or the dog owner influencer graciously giving you money off a specific brand of dog treats. 
 
Instagram post by Patrick Starr promoting Morphe makeup brushes

The benefits of affiliate marketing 

Affiliate marketing is like the clownfish who gets to live in the anemone in exchange for keeping it tidy. This symbiotic relationship benefits both the brand and the affiliate, rewarding both parties. Here are some of the main benefits of creating an affiliate marketing program:

Low start up costs

When starting up your affiliate program, you don’t have to buy ad space or get a creative team together to make ad visuals. Instead, you rely on affiliates to make great content. Aside from the initial push to find and vet affiliates, time and effort costs are also fairly low in this stage.

Low ongoing costs

As the program moves forward, affiliates take it from there. Your brand only pays out when the affiliate makes a sale, meaning costs are manageable, expected and do not interrupt cash flow. This differs from marketing tactics like PPC advertising where you pay every time someone clicks through to your site. With affiliate marketing, you only pay when a conversion occurs. 

Low risk

With low costs comes low risk. You know exactly what sales percentage you will be paying out when the conversion occurs and don’t have to worry about last-minute or unexpected costs.

Targeted traffic

Because the affiliates that represent your brand are selected and approved by your company, you can hone in the traffic you’re driving to your site. Chances are if you handpick affiliates that resonate with your brand, then their followers will, too.  

User generated content

Affiliate posts advertising your product double as free user generated content for you to use in your content marketing! Put the best affiliate photos on your social media feeds and blogs to boost your organic visuals.

Grow brand awareness

Affiliate marketing is an easy way to build valuable partnerships and get your brand name out into the world with hand-selected qualified individuals. You’re accessing their followers to benefit your own company and spread the word about your products. Not only that, but their followers are hearing about your product from someone they trust. This is an excellent way to acquire new customers!

Flexibility

An affiliate marketing program can be as big or as small as you make it. It’s easy to scale and you can grow it or shrink it depending on what works best for your brand. Zooming out to the bigger picture, it’s also an easy way to scale business as a whole without a lot of time and money cost.

High ROI

Because of the low start up costs, affiliate marketing tends to have a higher ROI than other marketing tactics. Conversions are higher because the audience is hearing about your products from affiliates they trust, and an affiliate marketing software platform can minimize time costs. 
 
Note that the better the benefits you offer to affiliates, the higher your ROI. Offering great incentives to partners can motivate them to promote your brand and drive sales.

Infographic detailing the benefits of affiliate marketing

Three things to consider when starting an affiliate program

Sounds great, right? Before you dive in, there are three main steps you should take in building your own affiliate marketing program.
 

1. Select an affiliate platform 

The best way to keep your affiliate marketing program organized is with a software platform designed specifically for this purpose. Almost every brand with an affiliate marketing program is on some sort of platform. It’s a very common practice!
 
There are several affiliate marketing platforms to choose from, each with its own pros and cons. Detailing them all is a blog post in itself, but ShareASale is the tried and true platform for beginners. If you sell a physical product, there are also several big-name e-commerce affiliate platforms available through brands like Amazon, eBay, Shopify and more.
 

2. Determine your commission system

Next, decide what percentage of the sale will go to your affiliate and how they will receive their money. How will you communicate your program and its incentives to potential affiliates?
 
When determining your commission rate, take into account industry standards as well as the rates your competitors offer. Are your rates better or the same? If they’re worse, why would the best affiliates choose to work with you over the competition?
 

3. Choose your affiliates

With a whole word of influencers and potential affiliates out there, it can be daunting to choose just a handful to best tout your brand. But the most important thing you can do when choosing affiliates is to understand your target audience. If your target audience aligns with that of a potential affiliate, then you’re in great shape.
 
Take time to do your research and scroll through a potential affiliate’s feed. Does their content and messaging align with that of your brand? You know your message better than anyone else, so don’t be afraid to trust your gut.
 
Taking these precautions ensures the site traffic you attract is likely to buy, benefitting both you and the affiliate. After all, if you want them to stick around, you’ll have to make sure they’re receiving money from the partnership. 
 
Like pollen stuck to a bumblebee or the clownfish living in the anemone, affiliate marketing is a wonderfully symbiotic relationship. Tapping into numerous different networks can give your brand an awareness facelift, reaching large numbers of new users at a low cost.
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