While watching a YouTube video, you might have come across content where the YouTuber shares a link in the description box for you to go and shop for the same product. If you believe those links in the description box are for your convenience, you are making a mistake. Every time you click on such links, the influencer gets paid. This is what affiliate marketing is all about, and content creators with sizeable followers earn handsomely from it today!
But what is Affiliate Marketing?
Affiliate marketing is the process wherein an affiliate or a partner earns a commission by promoting the brand or product of a business or person.
How does affiliate marketing work?
Brands or businesses reach out to affiliates to promote or endorse a product and earn a part of the revenue from every sale they generate. The sale is tracked via an affiliate link exclusively given to each affiliate or partner, which tracks traffic from one website to another.
The Affiliate Marketing Market in India
According to IAMAI (Internet and Mobile Association of India), the affiliate marketing sector in India is expected to reach $835 million by 2025. The Amazon affiliate programme is one of the most famous examples of affiliate marketing today. Affiliates have an easier time bringing in conversions if they have a well-recognised and trusted brand in the affiliate sector. Amazon affiliate programme also features a large number of Amazon products for affiliates to advertise, letting each affiliate choose from a variety of products that meet their interest. So, be a garden enthusiast or fashion influencer, amazon has a wide range of products for every niche. In addition, Amazon offers several affiliate linking methods for major websites, independent bloggers, and influencers, with around a 10% commission rate that may vary per category.
How do influencers make money in affiliate marketing?
Affiliates or partners receive a percentage from the clicks or purchases they can generate via their content in favour of the brand’s products or services. Content creators employ affiliate links across diverse platforms like blogs and social media sites such as Instagram, Twitter, YouTube, etc. These are distinctively measurable links to monitor how many clicks or revenue is generated to receive an agreed payment. Affiliate marketing is a popular influencer technique that supplements their earnings beyond sponsored posts. It’s also a method for budding micro-influencers to start earning money by collaborating with brands as content creators.
How much can an influencer earn from affiliate marketing depends upon various factors, such as:
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The number of followers:
The more followers you have, the more likely you will convert them into potential leads for your collaborated brand. As a result, content creators with massive followers make a good income with affiliate marketing.
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Industry:
The industry is also essential when it comes to generating revenue. For example, the fashion business is one of the most profitable niches for affiliate marketers. So, not only should you choose an industry that interests you, but also one in high demand.
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Engagement:
A good CTA can often result in a huge sale. However, channels with a high engagement ratio are more likely to succeed in affiliate marketing.
Types of affiliate payments:
How do influencers get paid in affiliate marketing?
Payment models in affiliate marketing depend on the affiliate you are and the affiliate marketing program you have chosen to work on. We have listed 5 types of affiliate pay models:
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CPC : Cost Per Click
This is a pay-per-click type of marketing where influencers are compensated for each click on an affiliate link by their followers.
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CPA : Cost Per Action
Any action mentioned in the affiliate programme is tracked in CPA, and driving such activities from the audience earns the influencer the commission.
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CPS: Cost Per Sale
A commission is paid on every sale made through an affiliate link.
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CPL: Cost Per Lead
With the CPL payment mechanism, an influencer earns a commission whenever a user signs up through the affiliate link.
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CPI: Cost Per Instal
The affiliate earns a commission when a user installs an app from the shared affiliate link.
Affiliate Marketing is the next big thing!
The advantages of affiliate marketing for businesses are countless, and several organisations leverage their best in numerous ways. For example, using affiliates to create an additional sales channel or enhance online marketing prospects is an approach that can significantly impact the business.
Neil Patel, Founder of Neil Patel Digital, believes- “Affiliate marketing is an excellent opportunity if you truly believe in the value of the product you’re selling. Because many times, you can make money off of something you would probably recommend anyway.”
This low-cost strategy to market businesses and their offerings across various platforms without investing much money has made it simple for companies to launch, maintain, and, most importantly, bring in new affiliates to promote their brands. Furthermore, affiliate marketing is a lucrative business for influencers. According to a 2021 survey conducted by Statista on affiliates worldwide, most respondents said they made nearly ten thousand dollars via affiliate marketing efforts, accounting for 57.55% of the total. One out of every six affiliates make a profit of up to $50,000, while about 4% make a profit of more than $100,000.
Affiliate marketing is being rejuvenated by e-commerce dynamics, the growing creative sector, and an intelligent product management team- increasing the efficiency of a strong digital marketing medium. This isn’t a brand-new concept but as old as SEO and Email marketing. It’s been there since the dawn of the commercial internet. However, this does not imply that affiliate marketing has remained unchanged. On the contrary, it has transformed dramatically and continues to do so. With this, there’s no doubt that affiliate marketing will bring in a lot of money for influencers!
