How does Affiliate Marketing work?

A very common element of the business and marketing world, affiliate marketing isn’t really prevalent at all in ELT and I started thinking about why based on my casual observations so far. I’m all for affiliate marketing, personally, as it is basically marketing and, since having my own business, I’ve come to realise marketing is essentially writing and I love that. But to talk about why it’s so under the radar in ELT, I first need to explain how affiliate marketing works.

What is affiliate marketing?

Affiliate marketing is when you refer other people to products or services, usually via affiliate links but it can be via personalised codes, and you earn a commission off any sale.

What is an affiliate link?

I think how affiliate marketing works is REALLY new to most people outside of the marketing world and has never had any place in teaching, materials writing or editing so is even harder as a concept. So, just like when you explain a word to English learners and the definition includes a word they also don’t know, my definition above is still confusing because it used the words “affiliate link”.

An affiliate link (and, to be clear, this blog post contains some affiliate links) is a url that contains all the usual information ie the domain name and maybe a specific page, for example http://www.website.com/page. But it also contains another bit of text that is unique to the affiliate so that the link, if used to make a sale, or lead to a later sale, connects back to the affiliate’s account and attributes the sale, and allocates the commission, to the affiliate. So the example becomes http://www.affiliateID-website.com/page.

It’s actually amazing this tech works and, usually, so seamlessly as it can even attribute sales long after the link has first been clicked.

How does affiliate marketing work?

Imagine someone is selling something for 100€ and offering an iate commission of 20%. 20€ would go to the affiliate who made the referral, and 80€ to the seller. It doesn’t make the price 20% more to the customer, it lowers the amount the seller makes. BUT the seller didn’t have to do anything to find that customer. Instead, the affiliate did the work by doing their own marketing to get that sale.

As finding new customers is hard, this is a huge piece of work the affiliate undertakes to the seller’s benefit (and their own of course!). Even getting your own audience to buy can be difficult, so sometimes an affiliate can nudge almost-ready-to-buy customers into buying customers. Yes, it’s possible sometimes the seller could have made that sale alone, but those times are probably massively outweighed by all the customers they couldn’t have reached.

Still though, as a business owner, it’s tempting to think about potential money you won’t make than potential money you might make (and even, at our most stubborn, we might think of the downside over and above money we actually have made through an affiliate sale). But that’s money mindset for you – more often than not our that mindset hinders rather than helps.

What are affiliate codes?

The other way, very common in influencer marketing, would be when you see a line like this “Check out XYZ product and use my code/my discount NICOLA at the checkout.” Sometimes those codes apply a discount that you wouldn’t get if you didn’t use the code. That can mean the seller has decided to give a bonus to the affiliate ie the commission on their sale AND to the customer as an incentive to buy, or to buy right now.

You might think this is a worse deal for the affiliate and for the seller. For the seller, they’ve now given away eg 10% as a discount and 20% to the affiliate in commission so are making 30% less. And for the affiliate, as their commission is based on the price the customer pays which is now 10% less, it means a smaller commission.

But again, this is thinking from the perspective of money that might have been lost instead of money that was made. The sale got made because A) the affiliate did the work of promoting and using their greater/different audience so there was an actual sale in the first place and B) the customer was more likely to buy with the discount incentive and therefore C) the affiliate’s job was easier because of the incentive so they probably worked harder to promote it and increased their sales and your income.

Offering affiliate programs (so other people do your marketing)

To put the last scenario another way, would you rather have 30% less in an actual sale or a sale that never happened? This is why you might want to think about offering an affiliate program. Perhaps only to previous clients, perhaps to anyone who fulfills certain criteria. If you want to learn more about how to do that successfully and without too much effort, here’s my affiliate link to business strategist, Lizzy Goddard’s course on The Lazy Guide to Street Teams (aka) Affiliate Programs).

I’ve done the course, it’s very digestible and quite reassuring as her emphasis is on the “lazy” part. You don’t want offering an affiliate program to take over your life otherwise you’re working double, not only on your own marketing but also on managing the affiliates and their efforts while giving away part of your sales which makes no sense.

You probably also need to be using, or adding, some software that lets you run an affiliate program. this is one of the main reasons I went for Thrivecart Pro to run my courses as the affiliate system is built in. Read more about why I chose Thrivecart here as it has other advantages namely it’s a one-off price and not a yearly fee, for now.

Lizzy’s course also has a section on running an affiliate program with basically no tech though, which is good if you just want to try the idea out.

How can you become an affiliate?

Basically just by asking/searching. If someone has an affiliate programme, you’ll find it on their website, or inside the client portal if you’re already a customer. If they don’t have one, you can always ask if they do. I’ve done that before for services I use and been referred to the third-party website they run their affiliate programme through but had otherwise never mentioned.

How can you become a good affiliate who actually makes money?

This is the key question because it really is a job, or at least a part of your work, that you put effort into learning and executing. Yes, you’ll make a few sales just by telling your friends and sharing the links somewhere. But then it will stop, just like sales of your own stuff drop off a cliff when you stop doing the marketing.

I’ll be honest, I’ve only started dabbling at the minute and I fully intend to take this course of Lizzy’s on how to be an affiliate marketer, The Lazy Guide to Affiliate Marketing, but I’m busy doing another of her courses at the moment, Silver Moon Sales, so am going to wing it semi-seriously for a while longer. (Only the first of those links is an AF link.)

Anyway, in the words of Elvis, I said all that to say all this: why is affiliate marketing not more of a thing in ELT and could it become one? Go here to read that post.