What is Affiliate Marketing?

What is Affiliate Marketing?

You’ve probably heard stories of people making an absolute fortune from affiliate marketing – quitting their jobs and essentially just watching the money roll in. But how likely is this scenario, and what exactly is affiliate marketing? We’ve explored some of the key points below, to give you a better overview of the world of affiliate marketing.

Affiliate Marketing For Beginners

The aim of affiliate marketing is to earn a passive income. You may have even heard the expression ‘make money while you sleep’ in relation to affiliate marketing. Essentially, you earn a commission when people buy products that you’ve promoted.

Both the company selling the product and the promoter benefits from affiliate marketing. The company can sell more products by offering a financial incentive through an affiliate program, and the promoter can make money by using a most likely already established social network to endorse a product or service they believe in.

The Definition of Affiliate Marketing

One of the best definitions of affiliate marketing is by Pat Flynn, via the Smart Passive Income website:

“Affiliate marketing is the process of earning a commission by promoting another company’s product (or service). You find a product, promote it to others, and earn a piece of the profit for each sale that you make.”

Basically, when you help another person or company generate sales, you earn a small percentage of that sale.

Summary Points

  • The idea of affiliate marketing is to earn a passive income by promoting products or services through networks you’ve already set up
  • As an affiliate, you’ll be given a unique link to a product, so that the company can trace the sale back to you
  • One of the main advantages of affiliate marketing is that you don’t need to invest time or money into creating a new product, service or business – you can earn money just by promoting these things
  • You can work with as many affiliate networks as you want, and there is usually a lot of flexibility with affiliate marketing

Affiliate Marketing

How Does Affiliate Marketing Work?

As an affiliate, you’ll be given a unique link that the merchant can track. For example, say you’re running a successful blog about knitting and crochet, and you’ve agreed to be an affiliate marketer for a particular type of alpaca wool. You’ll be given a link to the webpage selling the wool, with an individual collection of numbers or letters, so that the company can track the sale back to you. It might look something like this:


Each time someone clicks that link, a cookie will be stored on their device. This cookie can help attribute the sale to you, and will stay there for around 24 hours. Most cookies have an expiration date, so even if the buyer who clicked your link delays their purchase, you should still get paid.

It’s also important to note that you won’t just be compensated for the product you’re promoting. If a customer clicks on your link and buys the alpaca wool you’re endorsing, anything else they purchase in the same order should also earn you money.

Benefits of Affiliate Marketing

The main benefit of affiliate marketing is that you don’t need to create your own product or service, or invest a lot of money into starting up a business – someone has already done the hard work for you. You simply need to have a platform (or several) from which you can recommend products. Ideally you’ll already have a large audience or following, whether it’s through your own website, social media or a podcast.

Another benefit of affiliate marketing is that you don’t have to limit yourself in terms of numbers. You can work with as many affiliate networks as you like, and make money across multiple platforms. You can additionally gain loyal new customers for your own network by broadening your horizons.

A lot of affiliate marketers also appreciate the flexibility of different campaigns. You can earn money per click, per lead, or per sale. And when you’re paid can be flexible too – some companies will pay you each time you make a sale, while others will pay on a weekly or monthly basis.

If you’re looking to become an affiliate marketer in the financial industry, Leadtree Global would love to hear from you! Simply get in touch with us to discuss the possibilities open to our affiliate marketers.