What is an Affiliate Program? [A complete guide]
A complete guide for people who want to become Affiliates.
A complete guide for people who want to become Affiliates.
The Internet has changed the way people connect to the world. Today, we live an era of opportunities.
New technologies bring new channels and different ways to engage the consumer in services and content that is easier to be consumed with each passing day. This is excellent news for those who wish to take advantage of this kind of opportunity to do business.
This was how Affiliate Programs first started, with techniques, tools, and many new entrepreneurs who take advantage of this kind of business to work from home and have good profit margins, without the need of acquiring any goods or making any kind of investment.
The entrepreneur doesn’t have to create a product to offer, keep a website or even perform sales operations. All the opportunities are directly connected to the promotion of links, which act as recommendations of virtual products created by other people. And it is all done in a free, uncomplicated, and rewarding manner.
If you’re not familiar with the term “Affiliate Program”, today’s post will tell you all you need to know about this segment that permeates the universe of digital entrepreneurship.
Affiliate Marketing may seem a modern, revolutionary, and innovative idea (and it really is!) but in fact, it was first introduced in 1989. It all started when the American entrepreneur William J. Tobin, founder of PC Flowers and Gifts, noticed the potential of virtual promotion and created Prodigy – which became known as the first Affiliate Marketing Program in history. As years went by, small initiatives following the same concept started to emerge in the United States.
The owners of the first e-commerces noticed that there was an excellent opportunity in the network that connected people all around the world. That’s when a connection between e-commerces, websites on a variety of subjects, and the final consumer, was established.
Websites recommended products through content and banners, and when the visitor clicked on that specific link, she was redirected to another website to make the purchase. And for every sale made, the owner of the intermediary website would get a commission for the recommendation.
In July 1996, Amazon revolutionized the market by launching an Affiliate Program on a global scale to promote their products. And in the 2000s, Affiliate Marketing became a reality in the whole world.
The success of Affiliate Programs is, in part, due to this solid history of over two decades. Through the years, it has been consolidated as an economically feasible model, free of risks.
The entrepreneurs who participate in Affiliate Programs take advantage of being part of something truly secure, which is legally approved all over the world. Today, there’s a huge market for Affiliate Programs, specifically in the commerce of digital products.
An Affiliate Program works like a network of virtual business. It is nothing more than an opportunity for people to become promoters of other people’s products, in exchange for a commission.
This kind of service is seen (and chosen) by many people as a way of making business, of reaching the financial independence they have always dreamed of; and making money without leaving the comfort of their homes.
But after all, why is the Affiliate Program model so successful? What is the reason behind its success? The secret is that the program gathers people who share the same interests, and really helps them to succeed.
Basically, two main characters take part in it:
An Affiliate is a person with an innovative mindset, and willing to use the Internet in her favor. Affiliates make money by promoting links of digital products made available on a Distance Learning Platform, or physical goods, depending on the niche they act in. And then they earn commissions for every sale made through the links they shared.
Affiliates are also known as webmasters, since they constantly research the market and try to find new ways of improving their performance to sell more.
The Producer is a person who creates a digital product with the intention to sell it. They create materials in a variety of formats, such as ebooks, e-magazines, virtual guides, video-lessons, lectures, podcasts or software. These items may cover a multitude of areas – from culture, health, and cooking, to more complex themes such as financial management, corporate marketing, and information technology.
Producers understand the profile of today’s consumers, who want to buy digital products because of low cost, quick delivery and sustainability. But Producers want more than just creating products, they want to sell. That’s why they make digital products available on the platform, counting on the help from the Affiliates to increase their revenues. In exchange, they offer a commission for every sale made.
The Affiliate Program is a two-way street that brings Producers and Affiliates together in a great digital business.
A good Affiliate Program should be sustained by a company that offers the highest quality in management services. And for that, there are platforms such as Hotmart (to better understand how it works and the benefits Hotmart brings, read our post about Hotmart Club).
Once you become an Affiliate, the tool from the Affiliate Program you signed up for provides exclusive links so you can promote products. These links are coded in a way that every time you make a new sale, it will be possible to identify the conversion was completed through your content and you receive the commission due.
This question could be replaced by Is it possible to make money by taking part in an affiliate program?
Yes. Many people around the world make a living out of Affiliate Programs, turning the affiliation of products into a profession.
There are also those who work as Affiliates to make some extra money, which can be as useful as building a career as a digital entrepreneur. It all depends on your goal. However, there are some advantages for those who are Affiliates, and we have made a list for you.
There are many reasons for signing up for an Affiliate Program. The main one is the real opportunity to make money in a simple and independent way.
By publishing one single advertisement, the Affiliate can reach thousands of consumers and have many chances of making that referral into sales. And whenever that happens, the Affiliate gets a percentage of the value of the sale. In other words, the success depends only on their effort: the more the person works, more are the chances of making a profit.
But there are more advantages to an Affiliate Program. Actually, the system provides a variety of attractive ways in which an Affiliate can make a profit online.
Would you like to find out what they are?
Many people invest their savings in the creation of an e-commerce to fulfill their dreams of making money on the Internet. The problem, however, is that most virtual shops fail due to lack of planning and experience. But the Affiliate Program is an alternative that is financially safe. Registration is free, and there is no need for any kind of investment.
You don’t need to create a product to start making money online. Through the Affiliate Program, you promote links with the referrals of products that were created by other people, and you get commissions whenever a sale is made through the links you promoted. This means you can profit without worrying about acquiring and delivering the material being sold.
When you sign up for an Affiliate Program, you are starting a new business. If you can get good results working as an Affiliate, you will be able to enjoy many benefits: you will be your own boss, you will work from home and make all the decisions about your work. You will also be able to make your own schedule, without having someone monitoring your time and interfering with your work.
As an Affiliate, you will have many different products to promote. There are thousands of virtual products, in different formats, divided into dozens of niches. It will be easy to choose the ones that relate well to your audience, and, consequently, have a greater potential for sales and profits.
The Producer is responsible for all communication with the consumer – such as customer service and post-sale assistance. What’s more, the processing of sales and payments is made by the platform. The only thing the Affiliate has to do is promote the link, and doesn’t need to worry about anything else.
You don’t need your own website to start promoting digital products. You can use other tools, such as social media and email marketing. Nor is it necessary to have advanced computer skills to work as an Affiliate. Any person with a basic knowledge of the Internet can sign up for the Affiliate Program.
Each Producer sets a profit margin for the materials they make available on the platform. They can vary, reaching up to 80% of the total value of the digital product. It is up to the Affiliate to assess (based on sales statistics and quality) which product is more rewarding. What does this mean, in practice? You are the one who chooses the profit margin you want to work with.
How do you know if your work is generating good results? After you join the Affiliate Program, you will have access to the platform and will be able to control the performance of your referrals. The system will show you how many sales were made through the links you promoted; this leads to good financial planning and knowledge about when you will receive your commissions.
One of the main advantages of the Affiliate Program is that the payments are managed by the platform. This means the commissions are computed automatically after the sale, which eliminates the risk of default by the Producer. In this system, the Affiliate’s payment is completely guaranteed.
Another essential advantage of the Affiliate Program is the possibility of growth. Most people start promoting at a slow pace, using social media and blogs with a free domain. But as the payments start coming in, you can set aside part of the resources to expand your business.
Just like in the case of digital producers, any person can become a successful Affiliate.
With digital market expanding each day, it is possible to find an infinity of products and you can choose from the ones that best suit your audience’s needs.
Besides, it is possible to find a lot of material on affiliation and marketing techniques to use when promoting.
After much study and work on the Affiliate Market, we have noticed a pattern among four profiles that are the most common to this professional:
Even if you decide to work as an Affiliate in your free time, it is important to have some skills in order to make a sale. Let’s tell you some of them so you can put into practice:
Success is something on everybody’s minds nowadays. The truth is that not everybody can achieve their goals. And this is because dreams can only come true through actions. That’s right! Money doesn’t grow on trees, and it’s not the result of mere luck or chance. You need to work hard to get it. The good news is that every effort has consequences, and therefore, if someone is really committed to working hard, they can succeed.
If you want to become a successful Affiliate, it is necessary to face your daily activities like a company. This means that, in order to achieve high conversion rates in sales referrals and good financial results, you will need to make use of some business management techniques.
These are strategies from four basic areas of business administration: Planning, Marketing, Finances and Control. Seems complicated? Don’t you worry! It’s much simpler than you think. Let’s take a deeper dive:
Planning is an essential part of every business venture!
If you want to become a successful Affiliate, you must plan your actions carefully. A good start is to outline a timetable for your work, defining the time you will spend promoting links every day.
It is also advisable to set specific tasks, such as writing blog posts. This strategy will help you to keep the focus and avoid becoming unproductive.
Have in mind that planning goes beyond creating a schedule. You also need to set financial goals, which will help you guide your work. First, define what you wish to make in the short, medium and long terms. Then, define what you need to do to reach all these goals. Write everything down and organize yourself in order to achieve your objectives. This is the secret to grow.
If you wish to achieve expressive results in the Affiliate Program, you must have in mind that promoting links is nothing more than plain marketing. Therefore, it is essential to use the right tools to promote links. We created a list with seven golden tips to get it right when promoting:
This strategy will require some investment, but you rest assured it will be worth it. Statistics show that conversions are higher when the recommendations come from an Affiliate’s own website. It is recommended that you create a specific website for each niche.
It’s very important to use multiple channels of communications with the consumer. Besides a website, you should resort to social media and virtual forums. Successful Affiliates also invest in email marketing and physical advertising (which works really well depending on the case). And remember: whatever you choose to use, quality is essential. Consumers today want to access pages and ads that are visually attractive, with technical quality and without errors in grammar and spelling.
When you start promoting, you will have to focus on a market niche, and the more specific it is, the better.
But how do you choose a market niche?
Few companies can address a wide range of niches, as is the case of the Amazon and Walmart, which sell different products to a broad and diverse public. But a nutritionist who is dedicated to taking care of the diet of celiac children, deals with a very specific audience.
To optimize results, we recommend that your website or blog doesn’t mix workout tips with messages to animal lovers, for example. Even if these different audiences share common interests, you should choose a specific profile for your consumer and wholeheartedly dedicate to it. Only then will you be able to reach a high-quality audience.
And more than taking into consideration the subjects you like to talk about the most, it is important to list the ones that are more promising in the market of digital products. And then, align them with the material you create to attract more leads, and consequently, more buyers.
Companies that have Affiliate Programs make the products hosted on their platforms available so that Affiliates can select the ones they will promote. It is common to have a rank of the most sold or, yet, of those that have the best buyer satisfaction index, as is the case with Hotmart.
After this analysis, resort to some search tools as Google Trends, Keyword Planner from Google Adwords and Keyword Tool and check the volume of searches for themes related to the niche of the chosen product.
Now you have defined the profile of your audience, you need to know how to choose the right products to promote. The secret here is to find products with the greatest relevance to the customer, in other words, digital products that are really useful for your niche.
Let’s imagine you have a blog with make-up tips. In this case, you should recommend links to beauty guides and tutorials (after all, this is what the audience is looking for when they access this kind of page, right?).
When choosing which digital products to promote, it is also very important to pay attention to the quality. Check if the material is well prepared, if it is visually attractive, if the information is up to date and if there are mistakes in grammar and spelling.
Also check if the Producer’s page contains all these characteristics. They are essential because they help to make more sales. Consequently, your referrals will have a greater chance of success as well.
Many people don’t consider working with paid ads. But a successful Affiliate knows that this is not a cost, but an investment. This strategy will certainly lead to a substantial increase in audience, which in turn represents an increase in conversions. The links you promote will generate more clicks, sales will increase and so will your profits.
Content production is one of the main secrets in websites, blogs and social media profiles. This is what guarantees quality and faithful followers. The important thing is to write texts and posts with really interesting and useful content for your audience. The post will attract consumers to the pages, where they will have access to the links that promote digital products.
Financial management is one of the biggest challenges small business entrepreneurs face. Few have technical knowledge to correctly manage resources. If this is your case, don’t you worry. There are two main points you will have to pay close attention to in the Affiliate Program: how to make money and how to invest it. Let’s take a look:
As we explained, Affiliates make a percentage of the sales made through the links they have chosen to promote. This percentage is defined by a commission set by the Producer.
Therefore, if you want to achieve good financial results, you must be aware of this fact when you choose which products you are going to promote. The product with the highest commission is not necessarily the one which will generate more profits. You should also verify if the product has a good sales history and if it is really relevant to your audience.
One of the most common mistakes made by small business entrepreneurs is spending all the money that comes in, without worrying about ensuring business growth. It is very important that you set aside part of the profits for investment.
You can use these resources, for instance, to build your own site or to hire a designer to create new advertising material. It is also important to save some of the profits for those months in which activity goes down, since sales are always subject to seasonal market fluctuations and changes in the economic situation.
The three items above – Planning, Marketing and Finances – need Control. This is the aspect which will say if your strategies, in each of the areas mentioned, are working or not.
But, then, how do we monitor?
You just need the right metrics. There are many different kinds and some can provide the entrepreneur with similar responses. So, the secret is to know what and how to measure.
It is essential, for an Affiliate, to verify if the promotion strategies are working.
Find the conversion average from each of your ads and check the weaknesses and strengths in your marketing campaign. Invest in the strategies that are working and improve the ones that need a more substantial result. If you come to the conclusion that the general performance is below what is expected, you may need to make comprehensive changes.
Let’s take a look at a few examples. Make some changes in audience segmentation, look for different products to promote and invest in the creation of a (more attractive) layout for your pages. Another indispensable thing in the “Control” matter is the access to the reports from the platform. They will supply you with extremely valuable information about the performance of your work. You will be able to visualize, for instance, the number of clicks on your links, the volume of referrals converted into sales and the financial summary of your commissions.
The important thing is to work hard and keep track of everything constantly. This is the path of success!
The Producer is responsible for the creation of the digital product, as well as setting the price and the commission to be paid to the Affiliate.
Some Affiliate Programs give the Producer the option to leave affiliation open or closed. When it is open, any person can affiliate to the product. When it is closed, the Producer has to approve the Affiliates who apply to it before they can start promoting.
Besides, the Producer is responsible for all relationship with the client, from the delivery of the material (in this case, some platforms have this process automated to the Producer) to the customer support in case of questions.
Once you have chosen the products you will become an Affiliate to, it is time to set your first promotion strategies. Let’s take a look at some of the favorite options chosen:
Now that you know everything about affiliate programs, it is time to take the first steps towards becoming a successful professional. If you have chosen Hotmart as your platform, sign up for free and make your digital business come alive!
This post was originally published on August 10, 2016, and has been updated to contain more precise and complete information.