What is affiliate marketing?

Affiliate marketing rewards people who promote a product or service – like customers, influencers and creators – with a percentage of the value of each good sold.

It's widely understood that affiliate marketing was pioneered by Amazon in the mid-1990s when it launched its “Associates Program”. Essentially, Amazon created an army of online sales consultants who directed traffic to the website, rewarding them with sales commissions from the resulting purchases.

Fast forward to the present day, and affiliate marketing continues to provide substantial win-win scenarios for brands and their affiliate partners.

These days brands worldwide have extended affiliate programs that include individual influencers, website owners, and even other businesses. That’s because working with affiliates provides an excellent opportunity for anyone to promote a product or service in exchange for payment.

However, this technique is most effective when brands strive for authentic affiliate partners. Working with loyal influencers is often the most successful technique for driving traffic to your desired landing page, whereas collaborating with financially driven affiliates can potentially harm your brand if spamming is their only method of promotion.

Types of affiliates

Affiliate marketing allows brands to distribute promotional links or codes to affiliate partners. Affiliates can encompass a variety of individuals including:

Affiliate marketing payment strategies

There are a number of ways brands can pay affiliates, including:

  • A flat rate, one-off fee per individual customer
  • Commission for the purchase lifespan of every customer
  • Minimum traffic quotas – traffic volume needed before an affiliate earns payment
  • Sliding scale commission – improved percentages for each tier of additional traffic volume

How do brands benefit from affiliate marketing?

Brands benefit most from affiliate marketing as you can have thousands of affiliate partners driving traffic to your branded app or online store. Not only does this enhance your brand awareness to a new and existing customer base, but affiliate links also mean customers are only one click from a purchase.

In addition, working with affiliates also provides incredible traffic metrics, including which affiliates generate the most leads, clicks, registrations, and purchases.

Affiliate marketing benefits brand partners too!

Affiliates also benefit from this marketing technique primarily as a source of passive income. Commission payments can generate a few dollars a month for minor brand associates and up to tens of millions for enterprise-level affiliate marketing partners.

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