Affiliate Marketing: Earn a Lucrative Side Income as a Beginner
February 6, 2022
What do influencers, comparison portals and recommendation blogs have in common? They all share the same business model: affiliate marketing. And they all not only earn a lot of money every month, but also benefit from a high passive income. Do you want that too? Understandable! In this article I will give you affiliate examples, valuable insights into the business model and in my webinar I will tell you how you can easily generate five-digit sales per month. Here we go!
Earning money with affiliate marketing is possible. Actually very good. Does the name Bianca Classen mean something to you? Or the name “BibisBeautyPalace”? No? I would say most women between the ages of 15 and 25 will definitely know them. Bianca Classen, also called Bibi, is one of the most successful influencers in Germany with her YouTube channel and her accounts on Instagram and Co. Several million people follow her profiles (there are over 7 million on Instagram alone !) and thus take part in her life.
Because Bibi has an incredibly high reach, she is also interesting for all companies as an advertising partner in the beauty, lifestyle and fashion sectors . Everything Bibi holds in the camera, uses and recommends herself is also bought by her followers. In every third post on her profile, she advertises products and gives away gifts and voucher codes. Classic influencer marketing.
But why am I telling you about Bibi? Because working as an influencer is based on the classic affiliate business model. But fear not. Not only big fish like Bibi can build an affiliate business , you can do it too. And I want to explain to you how. With the help of this article and a webinar that we created especially for this purpose. More on that later.
Again and again I hear or read the following statements: “Affiliate marketing is dead”. “Affiliate marketing consists only of coupons”. “By canceling I can save a lot of commissions”…
Should I list more myths about affiliate marketing? On the Internet you can find heaps of prejudices, false assumptions and untruths about this business model. Please do me a favor and forget such dubious sites. Better read this article. Because it is definitely possible to make money with affiliate marketing.
Even today, affiliate marketing is both a relevant marketing strategy and a functioning and really lucrative business model. Every seventh euro in online trading course is generated by affiliate marketing. And the market has been growing steadily for years at around ten percent a year! I think most of you will surely have heard of this business model. For those who have not yet come into contact with it, I would like to get to the point very briefly: As an affiliate you sell products – but not your own.
Sounds pretty exciting to make money off other people’s products, doesn’t it? It is no longer a secret that you can earn good money with affiliate marketing. And yet many do not dare to approach the topic. Why? In my opinion, most people still don’t realize how easy it can be to start an affiliate business. It requires neither above-average technical know-how nor a very intensive investment of time.
In principle, affiliate marketing describes the cooperation of sales partners with the aim of selling products and earning money. So-called affiliates advertise products from manufacturers or retailers and receive a commission in return . To put it simply: affiliates help sell third-party products. This principle works equally well for services. And because affiliates recommend other products, so to speak, this business model is also called referral marketing.
Surely you already know various affiliate businesses, even if you haven’t heard the name of the business model before. Have you recently visited a product comparison site to find the best price for your new washing machine, hiking backpack or hotel for your next vacation? And did you then follow the link to the cheapest offer? These are often affiliate links. I’m talking about comparison portals like Idealo or Check24. Test and topic portals such as the technology website CHIP are also very popular. Whether vacuum cleaner robots, SLR cameras or smartwatches in the test: Links to the products are included in the reports and lead you as the reader directly to Amazon, Saturn or Mediamarkt. And CHIP earns a commission on it. Classic affiliate marketing
But let’s get back to the theory. Strictly speaking, the word affiliate only means partner . So when it comes to the question “What is an affiliate?”, two parties to affiliate marketing can be the right answer. Therefore, it depends on the context whether promoting or selling distributors are meant. In everyday use, however, it is more common from an affiliatethe speech when it comes to someone who advertises a third-party product and earns money depending on the commission if the deal is successful. Some also call an affiliate a publisher. If you start your own affiliate business, you are the publisher. I’m being precise here so that you don’t lose track of all the technical terms and understand the structure of the business model.
The affiliate then faces the sales partners who want to sell their own product. These can be manufacturers, but also dealers. In affiliate marketing, these partners are also called advertisers. Many brands act as such advertisers by offering affiliate programs and paying commissions when you promote their products. I could name countless such as Saturn, Zalando or booking.com. These big companies all offer their own affiliate programs. Take your smartphone and see if your favorite brand doesn’t also offer an affiliate program.
But back to the affiliate business model: To be really precise, in addition to the two roles mentioned – publisher and advertiser – there can also be a third partner: the affiliate network. Affiliate networks are platforms on which affiliates and advertisers can register and find each other. So, affiliate networks act as an intermediary between the two parties and handle all payment matters. An affiliate network that you have probably already heard of is the Amazon Partnernet – I will go into this separately later in the article.
In my free webinar on affiliate marketing , I will tell you which partner programs and advertisers I can really recommend to you . So please have a look.
Few, pretty complicated? Not really, once you understand the basic structures. So now we come to the exciting part, namely how you can start your own affiliate business .
To make things clearer, let’s look at an example of affiliate marketing. First of all, six steps are relevant, which I have also shown you in the following infographic.
Suppose you are a passionate gardener and share your knowledge about it on a blog . If you’re writing an article about pruning roses, you could also use this framework to recommend related products in your text. This recommendation is then: “I’ve been using XY’s rose scissors the most for years.” Then, in the description “XY’s rose scissors”, insert a link to the advertiser’s product page that you want to advertise in this case. Once your blog visitors read your post and are interested in the pruning shears, they will click your link to take a closer look at the product.
By clicking on the affiliate link, your readers become users on the website of your sales partner and you have successfully directed visitors to the advertiser’s website (traffic generated). But in most cases you will not receive any compensation for this. In order for you to be able to earn money with affiliate marketing, the users usually have to buy something. So you only get a commission when the customers buy the rose scissors via your link.
The next important step is paying the customers. Because the advertiser must be able to understand which affiliate persuaded the customer to make a purchase. The purchase can be traced via an ID in the forwarding – this means that the advertiser can easily see that the pruning shears were sold by you. This is how you get your commission. If the application was made through an independent affiliate program, such as Amazon PartnerNet, you will handle payment matters directly with the advertiser. This is different if an affiliate network stands between you and the advertisers.
In order to start an affiliate business as a beginner, there are a few requirements that you should have in order to really make a profit . Let’s start at the beginning.
First, you need a platform on which to place your promotional content and affiliate links. Your own website or blog is best suited for this. If you are on social networks, this is also suitable. Here, too, it is possible to run an affiliate business via YouTube , Facebook or Instagram . But beware: Please note that you are always subject to the regulations of the social media channel.
You probably won’t be able to show that many followers right now . That’s not bad either. Everyone started out small. And you have to start somewhere. The important thing is that you start building this reach now. Because the more people you reach with your content , the more potential customers you generate for the advertisers. And you earn more money accordingly. Logical.
When do people buy something? When are you ready to spend money on products if you don’t know them yet? This is an important question for a functioning affiliate business. Feel free to ask yourself: When do I buy a product or service?
I’ll be happy to help you: People will only buy something via your affiliate link if they are convinced of your content and trust your statements. Consequently, it is crucial for your success that your readers and followers can really trust you. So make sure to credibly present a certain expertise to the outside world. It is best to present your knowledge so perfectly that your product recommendations appear rather irrelevant.
Now that we’ve talked so much about the requirements of your own website and content, we now need to talk about the affiliate networks and partner programs. Because for a successful affiliate business you need advertisers and products that you can recommend.
If you want to connect with advertisers via an affiliate network, you must register there as a publisher. Once registered, you have access to numerous partner programs from different areas. If you work with a publisher, all billing for all advertised partner programs also runs through one account. This is super easy and really uncomplicated, because you always have your earnings ready at a glance.
Another advantage of these networks is the technical component. Affiliate networks take care of the technical basis of the tracking and thus also the correct allocation of the commission. While it never hurts to keep an eye on commission payments yourself, such a network is a great option for people who like to outsource this task. Registration and participation in these networks is often free of charge for you as a publisher. Sounds damn easy? And very lucrative? It is. But please consider the following: Your earnings can be reduced as commissions within the framework of networks can be somewhat lower. But there is still an alternative , in-house affiliate programs.
In addition to affiliate networks, there is another way to run an affiliate business. With so-called in-house partner programs. With the in-house affiliate program, companies that want to run the affiliate program simply implement it themselves. This means they offer publishers without a mediation platform the opportunity to recommend their products. Registration for the partner program and support then take place on the company’s website. So as a publisher you have to go looking for a partner yourself.
There are now many companies that offer an affiliate program. At the beginning of this chapter I already addressed big players like Saturn, Amazon and Zalando . However, manufacturers or dealers do not always communicate this. It is therefore worth asking companies directly if you want to specifically advertise a specific product.
That’s difficult to answer. There is no general answer that I can give you at this point. Networks work much better for some, while others get along better with in-house partner programs. So it depends on what you want and what is important to you.
With the in-house partner programs, you always have to register separately and often get different contacts. So you always have to be a little bit behind and work more independently. At first, it might be difficult to meet the minimum withdrawal limit as you get different billing for each in-house affiliate program . However, the payout limit above which your earnings will be transferred to you varies from program to program. You can find out the exact conditions on the websites of the advertisers. (Something like this is very important, so check the conditions very carefully!)
However, in-house affiliate programs also have some advantages. Due to the close contact with the advertiser, you as a publisher are often provided with individual advertising material . Basically you can negotiate a lot more here and enter into a lot of individualized cooperation. But the best comes last: The commissions are often significantly higher than with affiliate networks.
An example of an affiliate program is the Amazon PartnerNet. I want to introduce you to this one because it is one of the most used affiliate programs. With a broad product range of several million products, the Amazon affiliate program offers suitable products for probably every affiliate with their own website . If you can convince customers of Amazon products via your website, as an affiliate you will receive a commission on the entire shopping cart and not just on the product that you have advertised. Yes, you heard me right. Amazon also pays the reimbursement of advertising costs reliably and on time. But beware: Depending on the product category, there are different amounts of commission. Therefore, find out in advance whether the commission in your category is worth it at all.
But here, too, the success – and of course your earnings – depends above all on your topic. If you have discovered a good niche for which Amazon products can be presented, you can certainly build a successful online business with Amazon.
The truth is, how much money you can make from affiliate marketing depends on the flow of traffic to your site. Yes I know, no specific numbers. But unfortunately that’s the way it is. The greater the traffic on your website, the more interesting this website is for potential advertisers and the more money you can make with affiliate marketing. An affiliate business builds up slowly and requires regular support, especially in the beginning.
If you get involved, maintain your website, fill it with current and new content, deal with search engine optimization (SEO) and increase your reach, the earnings can keep increasing. And at some point grow from a small passive income to a large online business.
An important thing to keep in mind is that passive income is an easy way to build your overall net worth. As such, you must ensure you are diligent with your bookkeeping. After all, the IRS will want to know about the catalyst behind your momentum—revenue—as you begin your upward journey from tax bracket to tax bracket. In fact, you can estimate your taxable income with a tax bracket calculator, ultimately allowing you to keep your bookkeeping accurate and optimized.
What some of you may not know yet: You do not only receive a commission through the affiliate links and products sold. There are also alternative revenue models. I would like to introduce you all to you:
First the model that you surely know. PPS or Pay per Sale (also CPS: Cost per Sale): With this form of remuneration, you as an affiliate only receive a commission if customers have actually bought a product via your affiliate link. The links are provided with a code so that it can be determined via which affiliate a sale is made. When clicking on affiliate links, cookies are set for the users. In this way, precise tracking can take place and a sale that is offset in time can also be assigned.
However, as is generally the case in performance marketing , there are other cases in which remuneration is possible:
Depending on which remuneration model you prefer, you should definitely clarify with your advertiser before signing the contract how exactly you want to be rewarded. You may be able to negotiate this part individually – but unfortunately that doesn’t work with every partner.
The affiliate business is characterized by a lot of flexibility and a low weekly time commitment. Of course, at the beginning you have to invest time and effort to fill your website or your social media account with basic information about your topic. But once that’s done, you only have to provide your readers with a few new articles per week. If you are looking for a business model that runs perfectly on the side, requires little technical know-how and little attention , affiliate business is the right business model for you.
You now know which adjustment screws lead to the desired success. If you still shy away from building the basic framework, where you first have to fill your website with content and optimize it for SEO, then I have a real booster tip for you that I would like to present to you in my free webinar. As a supplement to this article, you will find out there:
Ans: Affiliate marketing describes the cooperation between sales partners with the aim of selling products and making money. Affiliates advertise products from manufacturers or retailers and receive a commission in return.
Ans: Affiliate networks are platforms on which affiliates and advertisers can register and find each other.
Ans: In order to be able to earn money with affiliate marketing, there are three key requirements for affiliates: