There are few buzz words that are trendier than “affiliate marketing.” And while many social media influencers tout affiliate marketing as a great side hustle, it’s actually a significant way for businesses and individuals to make money. Affiliate marketing programs are expected to grow up to $8.2 billion in 2022. That’s a 52% growth from just five years ago. That means there’s plenty of money on the table for those willing to put in the work.
While you’ve probably heard this term before, you may not know all of the ins and outs of what it is. Essentially, affiliate marketing is an advertising model where companies reward third-party people/organizations for generating traffic, leads, and sales. It’s not too dissimilar from a commission-based referral program.
Affiliate marketing programs vary from company to company and industry to industry, but there are some similarities. Your company basically builds a partnership with an affiliate, someone who can promote your product or service. When they drive sales, you pay them a commission, whether it’s a percent of the sale or a flat fee. Tracking these sales is as easy using a powerful affiliate software program that creates a unique link or promotion code for each unique affiliate.
There are an endless number of digital marketing strategies available to help companies grow their businesses. From social media marketing to event sponsoring to influencer marketing and more, companies can create a combination of plans to reach their goals.
Affiliate marketing offers benefits that you can’t necessarily find in other digital marketing strategies. A successful affiliate program allows your company to promote itself on multiple levels at once.
Getting involved with an affiliate marketing program doesn’t require the costs you might see with starting a different kind of ad campaign. Depending on the specifics of the campaign, your company may have to spend time and money to obtain visuals, copy, mailing lists, ad space, and more.
An affiliate program doesn’t incur these kinds of expenses. In fact, you can often start an affiliate program with no initial start-up costs at all.
Every business needs to pay attention to its bottom line. Since operating costs are often the highest part of your budget, keeping these costs down is critical. When companies have to make cuts, it’s easy to eliminate high-cost campaigns, even if those efforts might see returns in the future.
Affiliate marketing has virtually no ongoing costs. Once you build a relationship with your affiliates, the program nearly runs itself. That’s because affiliates typically only get paid when they receive credit for a sale.
Whenever you can minimize your start-up and ongoing costs, you set yourself up for excellent ROI. According to research, companies, on average, are allocating around 15% of their marketing budgets to affiliate marketing. The current value of affiliate marketing is $12 billion, with advertisers who use affiliate programs generating between 15% to 30% of their sales.
To put it plainly, that same research showed that businesses that use affiliate marketing earn about $15 per every $1 spent on their programs. You also have the option to make your affiliate program larger or smaller whenever you decide to without any significant financial investments.
Anytime you embark on a new marketing adventure, there is a risk. Most of the time, that risk is financial. If you’re on a tight budget or your board likes to play it safe with new ideas, affiliate marketing is a perfect solution.
Payments are only made after a conversion. You only put money out when money is coming in; that means there is little financial risk. You can expand your affiliate network, which increases sales, without having to risk losing your investment.
Once you build a reliable affiliate network, you’ll see a massive boost in your reputation. That’s because your affiliates are often in the circles where your customers spend their time. These affiliates resonate with your target audience and boost your overall reputation.
Think of it this way; affiliates are people who spread the word about your products or services in a positive way. They are a team of brand ambassadors that advertise your company through their networks. Increased traffic from your team of affiliates will make your brand more recognizable to your current and potential customers.
Your company’s affiliate program can take on various shapes and sizes, which can make the entire process feel a little overwhelming. Instead of avoiding jumping into the game, you can take advantage of various software solutions that give your affiliate program a better chance of success.
For example, the right software can easily help you manage the commissions you payout to various affiliates. These programs can be configured as needed and even pay commissions in multiple currencies. You can essentially set up your program and let your affiliates do the work for you, while your commission’s engine handles the hard work.
Your company isn’t the only side that benefits from an affiliate marketing relationship. There must be some perks to actually becoming an affiliate, or people wouldn’t do it. When you understand why someone might want to learn how to become an affiliate marketer, you can attract better affiliates.
Affiliate marketing is a great way for people to earn some extra money. While the average affiliate marketer, according to Glassdoor, is $60,684, less than 50% of affiliates earn $20,000. Those higher salaries that bring this average up come from top names in the business. People like John Chow, Kristy Mccubin, and Pat Flynn earn excellent incomes through their affiliate marketing efforts.
For most people, an extra $20,000 per year is enormous, especially considering they can make this money promoting products and services they already know and enjoy.
Affiliate marketers have complete control of their schedules. You can work full-time, part-time, or just put in time here and there. Many would even argue that knowing how to start affiliate marketing is one of the easiest and most fruitful work-from-home jobs around.
You can also pick and choose which kinds of companies, products, and services you promote. That means you can add some variety and excitement to your routine by simply adding something new or different into your promotion work.
Most affiliate marketers promote products through social media, blogs, and other online activities. Keeping track of which pieces of content work is one of the critical elements for any creator. When you’re promoting various products and services, you often get access to additional data points.
Seeing what types of products resonate with your audience, which links are getting visits, and how many conversions take place will only help you refine your content and earn more engagement. Make sure that whatever affiliate software you use offers a robust level of detailed reports that your business and your affiliates require.
While many affiliates go into business for extra side cash, there are plenty of emerging opportunities for those looking for additional possibilities. For example, many direct selling companies are launching hybrid programs where they have both sales reps and affiliates working to make sales. Affiliates start by earning a smaller commission than representatives but have the opportunity to become a rep and earn a higher commission for each sale. For those who prefer not to join, they will continue to be a great ambassador for your brand
If you’re interested in helping your company increase sales and build brand awareness, an affiliate marketing program could be an excellent addition to your digital marketing plan. To ensure you get the most from your program, make sure you select the right affiliate software to help track your progress. That will ensure that you reap the benefits of affiliate marketing and remove many of the potential challenges.
ByDesign Technologies provides software solutions to help affiliate companies and their representatives nurture strong, long-term customer relationships and drive repeat sales. Visit ByDesign.com to learn more – and contact us to schedule a consultation.
It’s time to let others spread the word about your business. It’s time to start an affiliate marketing program.