Affiliate marketing has become, the most popular and effective platform to generate passive income online. By commercialising your products or services on your social media, or other digital platforms, you can earn commissions whenever someone makes a purchase or completes a desired action through your affiliate link assigned to you by any online merchant.

What Is Affiliate Marketing?

Affiliate marketing is a performance-based marketing strategy where businesses (referred to as merchants) pay individuals or companies (affiliates) a commission for driving sales, traffic, or other actions. Affiliates promote the merchant’s products through unique tracking links, and when someone clicks on the link and completes an action, the affiliate earns a commission.

This marketing model is appealing to both businesses and affiliates: businesses gain wider exposure with minimal upfront costs, and affiliates earn money by promoting products they don’t need to own or manage.

How Does Affiliate Marketing Work?

Affiliate marketing operates on a simple structure involving such steps:

1. Join an Affiliate Program: Affiliates get register for an affiliate program offered by a company or an affiliate network (a platform that connects merchants and affiliates). Popular networks include Amazon Associates, Share a Sale, and Click Bank.
2. Promote Products or Services: Affiliates receive unique affiliate links for the products or services they want to promote. These links are tracked to record clicks and sales driven by the affiliate’s promotional efforts.
3. Earn Commissions: The commission structure varies by program but typically ranges from 5% to 50% of the product’s sale price, depending on the affiliate program.

The Players Involved in Affiliate Marketing

1. Merchant: The company or business selling products or services.
2. Affiliate: The individual or business promoting the merchant’s offers.
3. Consumer: The person who clicks on the affiliate link and makes a purchase or performs the desired action.
4. Affiliate Network (optional): A platform that acts as an intermediate platform between affiliates and merchants, offering tracking and payment tools.