How Does Affiliate Marketing Work

Hi everyone! Many of you are confused about what affiliate marketing is. I felt the exact same way when I got started. Haha, I don’t even think the word “affiliate marketing” was invented back in 1998, when a friend of ours told us that we could earn money by linking to book on Amazon. Actually, he said that he bought himself through his own links! I now know that this is against the rules, but back then? I had no idea about how affiliate marketing worked.

My first Amazon page (in Danish) didn’t make me much money, because I made some obvious errors. It took me years to figure out what they were. And I’ve come a long way, since then. I’ve become a full-time writer and Internet marketer, and a big part of my income derives from affiliate marketing.  

Now that I know what to do and what not to do, I can help others, so I want to share a story with you that might help you connect the dots on the affiliate marketing concept, and then I’ll show you how you can get started with it yourself.

How does affiliate marketing work?

You can compare it to the following. Let’s say that you really love the bread you buy from one of the baker stores in your city. You tell him how much you love his bread, and he says to you:

– Why don’t you tell your friends about my bread? If they come and buy in my shop, I’ll pay you 3% of what they spend here.

You’re happy, because you would really like to help your baker get more clients, and you know that your friends will be happy, too, because he does make some tasty breads.

So the next time one of your friends visit you, you serve him a piece of bread with peanutbutter and jelly, and then you tell him where he can find the bread himself.

So your friend goes to your baker and says that you send him. He buys his bread, and the baker sends you a check with the 3% of what he spend.

Okay, this is an offline example that rarely happens, but it could. Now let me show you how affiliate marketing work on the Internet.

How Does Affiliate Marketing Work

If you want to do affiliate marketing on the Internet, there are two ways to go:

  • You can start with a product.
  • You can start with an affiliate network.

How does affiliate marketing work when you start with a product

How does affiliate marketing work

Back in 1998, I bought my first e-book ever! It was written by Jim Edwards and Joe Vitale and it was called “How to Write and Publish Your Own eBook in as little as 7 Days“. I knew neither of the two guys back then, but I liked the book. So I joined Jim’s and Joe’s email lists.

 A short while later, Jim Edwards told me (in his mail) about a guy who was responsible for Jim’s success. I followed the link, curious to learn more.

And I was let to an e-book by Marlon Sanders. It wasn’t cheap. I asked my husband what he thought, and he said: Buy it.

Marlon had a guarantee that said: “Your products sell like crazy — or 3x your money back”. That sort of convinced me 😉

We had to wait several days, before we could get started. Back then, Marlon sent out his books on a CD as an exe-file (for Windows), and we had to use the pin-code he provided to open the file and read the book.

We printed it out, and we BOTH read the book. This is probably the ONLY book about Internet marketing my husband has ever read.

You have to start somewhere, when you get a book like that, and we started out by using Marlon’s advice about press-releases. My husband was just about to release a new product, and we wrote the press-release like Marlon told us to – and we went on this crazy ride!

It was cha-ching all weekend long! We made so many sales that you cannot believe it, and we got members for my husband’s membership site at the same time.

We made more money in a weekend than we would have made, if a publishing house had printed his book, and we didn’t have to wait 6-12 months to get our money. We made back our investment in Marlon’s “Amazing Formula” book many, many times.

Then we started to implement more of his tips, and one of them (used in 2006) is still making us money – EVERY month. (Passive income, that is.)

I guess you believe me now when I say that I really loved that book, and I wanted to share it with others.

So I went back to the sales page and looked for an affiliate programme. And since Marlon is a smart man, he had a link at the bottom of the page:

affiliate link at the bottom

Okay, but what about marketers who aren’t as smart as Marlon? Some don’t have an affliate link at their site. This could be on purpose (some marketers only want buyers to become affiliates), but it could also be a mistake.

There are several things you can do to check if they have an affiliate programme, and where to find it.

You can search for the word “affiliate” on that site in your favourite search engine.

I use the programme WhiteSmoke to proofread articles, and I really like the programme. But when I went to their page to find an affiliate link, I saw nothing. Neither at the top nor at the bottom.

Nothing about affiliates here

So I searched on Google for “affiliate” and “site:whitesmoke.com” and got a result.

But what if Google don’t provide anything?

In that case, you could write and ask the author or product owner if he has an affiliate programme.

In most cases, product owners have affiliate programmes – or partner programmes as they are also called.

When you’ve located the affiliate programme, you need to join it and get a special link, which you use to promote the product with.

[VIDEO coming]

When you have the link, you can use it in emails or blog posts or other places, where it’s allowed.

If a person buys through your link, you’ll earn a commission. Sometimes, it’s paid immediately, but often it is delayed until you’ve made a minimum amount, or maybe until the refund period is over.

You get paid either by check, to your bank account or by PayPal or similar services. That depends on the product creator and your choices.

How does affiliate marketing work when you start with an affiliate network

Sometimes, instead of starting out with the product, you’ll want to start on the affiliate network.

You can find products to promote on affiliate networks like ClickBank, PayDotCom, JVZoo, or Amazon.

Personally, I like ClickBank and Amazon, because you’re always getting paid on time from those two places, and they have so many products.

Amazon has the extra advantage that you can find reviews there. You can be almost certain about whether or not your chosen product really is good.

JVZoo is great, but so far I’ve only used it to promote Warrior Special Offers with. While ClickBank and Amazon pays you by check or direct deposit to your bank, JVZoo pays to PayPal. If you’re already a trusted affiliate, you will get paid immediately, when somebody buys through your link.

PayDotCom – well… I have never had any problems with them, except that their site loads really slowly, but here you rely on the product owner to pay you once a month.

But you can go to these places and browse through their products, and then go through the same steps as mentioned above: get the special link, and promote it. Receive money.

Advantages to Affiliate Marketing

It’s easier to do affiliate marketing than to create your own product, keep a stock, write sales page, take care of customers, etc.

You can get paid very well. A lot of people earn their living as affiliate marketers.

I’ve been promoting both digital products as well as physical products. Actually, my very first affiliate experience was Amazon, as mentioned above.

I’ve had the most success with digital products – not by adding banners to my site, but by writing honest reviews of them and telling both the good as well as the bad about them.

Some products converted very well. I remember one product – I didn’t find it very good, but it was cheap ($10) and one of the tips inside it was great. So I wrote that on my blog, not expecting to make any sales at all.

I sold several 😀

At other times, I’ve spend 8-10 hours doing a thorough review of a product I loved – and had only a few sales.

That’s the funny thing about affiliate marketing. It’s not an exact science. You’re dealing with human beings here, and we are unpredictable.

So it’s a learning process as well as trial and error.

And of course for every step of affiliate marketing there is more to learn than what I’ve mentioned here.

Finding the right product to promote and how to promote the product, those things matters.

This blog post would end up being as long as a book, if I should describe these things here, but this should answer your question: “how does affiliate marketing work”.

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