What is affiliate marketing? Complete Guide 2024

Blog / Advertiser / What is affiliate marketing? Complete Guide 2024
Written by Heimar Svensson
Published 30 Jun 2024Updated 1 Jul 2024
Have you perhaps heard of affiliate marketing but not really understand what it means? Read our guide that covers how you as both an advertiser and an affiliate can start working with affiliate marketing to make more money online.

What is affiliate marketing? Complete Guide 2024

Affiliate marketing is a performance-based way of marketing yourself online. An affiliate promotes a product and if somebody makes a purchase thanks to the recommendation, they receive commission from the advertiser (the company whose product was purchased). Affiliate marketing have no fixed costs attached, it is 100% performance-based and a commission is only paid once a sale is made.

What is affiliate marketing?

The concept of affiliate marketing is performance-based marketing, where advertisers and affiliates cooperate with each other to earn money. Affiliates promote a company's service or product through their channels (e.g. a website, blog or social media account) and earn money from purchases if a customer visits the advertiser's website via the link an affiliate has shared to its audience. It doesn't have to be just a blogger or an influencer as many people usually think with affiliate marketing. It could be a comparison site or a global news site. Countless websites that you visit every single day are highly active in the field of affiliate marketing without you knowing it.


Online marketing man on computer


It is usually said that affiliate marketing makes up between 5-25% of a company's online sales, where more mature markets such as Europe and the US are in the higher range of that. Affiliate marketing really is mch bigger than people think and is a very effective way to market yourself as a brand looing to grow. We'll tell you more why this is in just a few moments, but first we'll go through different concepts in affiliate marketing so that you get the best possible understanding of how it works.

What is an advertiser?

An advertiser in affiliate marketing is a company that has joined an affiliate network and offers commissions if an affiliate create sales for them. The commission that an advertiser offers is clear from the start, but there is usually the possibility of getting a higher commission if you, as an affiliate, can offer larger sales volumes. Once an affiliate is approved, they become an affiliate of the advertiser and receive a unique tracking link to use on their website or social media account.

Affiliate marketing is a great way for an advertiser to reach a wider audience with their products and services . Affiliates can promote products and services through their own websites and social media, thus reaching customers that the advertiser might otherwise not have reached. The advertiser only pays for performance, which makes it a very cost-effective form of marketing.

Can all companies use affiliate marketing?

More or less all companies, yes! The only thing required is that you have some kind of digital conversion point, for example a shopping cart in your e-commerce store, an app download, or the possiblity to create an account. Because you as an advertiser approve affiliates yourself, you have full control over who markets your products or services. There are lots of affiliates that are active in several different niches, which means that no matter what your business is, there will almost certainly be several affiliates who can promote your services or products.


E-commerce store selling products online


If you have a company that sells training products, perhaps influencers, bloggers or a site that compares the best running shoes and so on would make good affiliates for you. Keep in mind that then it must be influencers or bloggers who are relevant to your company and who have a target group today that has an interest in training so that you can earn more money.

So, is there any cost if an affiliate doesn't deliver sales? No, it costs you nothing as an advertiser if an affiliate manages to drive traffic to your website which does not convert to sales, you only pay if products are actually purchased. So when you pay an affiliate money then you know you made money, making it an effective form of marketing. You as a business lose nothing by joining an affiliate network because it is performance-based. Please excuse the somewhat worn out expression, but affiliate marketing really is a "win-win".

What is an affiliate?

An affiliate is one who promotes a company's products or services and earns money by sending visitors and potential customers to the advertiser's website. For a person (or a larger publishing company) who is an affiliate, it's about getting as much traffic as possible on yourn platform and then passing it on to companies that pay for that opportunity. It is therefore incredibly important for an affiliate that they only drive traffic to an advertiser that actually generates revenue for the advertiser in question, otherwise they themselves will not get paid.

When you are an affiliate, your main goal is to attract traffic in a specific field and then refer it to businesses to make money. Your compensation usually consists of getting paid for each new customer or a percentage of what your visitors buy from the advertiser you partner with.

What is an affiliate network?

An affiliate network is a platform where affiliates find the different advertisers they want to work with. After you have been approved as an affiliate, you receive your so-called affiliate links that you use on your platform when you drive traffic to the advertiser. It is important that you use the affiliate link because it contains unique metrics that allow the affiliate networks to see who has sent traffic to whom, and who should get their commission. It is perhaps the single most important detail in affiliate marketing because the model is based on performance-based marketing and you must be paid for performance.

How do you get started with affiliate marketing?

Getting started with affiliate marketing is easy and takes just a few minutes. You join a network (like Addrevenue) if you are an advertiser, and write about your business and the commission you offer to an affiliate. If you are an affiliate, regardless of how "big" you are, you can start with affiliate marketing in just a few minutes as well. Most of the networks do not have a minimum limit on how many followers you need to have to join the affiliate network. However, networks do require that your content is relevant and meets a certain quality standard.


Podcast studio setup


Once you have joined as an affiliate on a network you can start applying to different advertisers and start to direct traffic to company websites and start making money.

3 Benefits of Affiliate Marketing - Advertiser

Being an advertiser has many advantages because it is cost-effective marketing method where you only pay for performance. You also decide yourself who will be allowed to become an affiliate for your company, which gives you full control over who markets your brand. With affiliate marketing, you can reach a target group that you cannot reach today. 

1. Affiliate marketing is cost effective

This is one of the main reasons to start working with affiliate marketing. Say "Goodbye!" to paying 1,000 USD per post on Instagram without any guaranteed results, with affiliate marketing you don't have to pay for advertising that doesn't sell. This is because you only pay for performance.


Online marketing mix


As an advertiser, you decide how much commission you will offer an affiliate. You can also vary your offer between different types of collaboration partners. For example, you may want to offer double the commission to influencers on Instagram versus affiliates publishing an online magazine or a blog. When you see that there is reason to offer a little more to be seen on a blog, website or in videos, you can increase the commission and, on the contrary, lower it for the affiliates who are not as attractive.

As an advertiser, your costs are only:

  • The time you spend finding the right channels and partners for your brand
  • Any products you want to send out to get more attention and authentic content produced
  • Time on communication with influencers or the people behind a website or a Youtube channel
  • Commissions you pay for actual sales

Then of course it could be the case that you want to produce banners and other materials that your affiliates can use to make your campaign look as uniform as possible. It may be wise to offer on-brand images for affiliates to be used on their websites rather than copies found online in various places - but it is not a must. But even if we imagine that you spend a lot of time creating good visual material and finding the right partners, affiliate marketing remains a very cost-effective method. You will have firm control over your expenses and your profit margins.

2. You don't take any major risks when you start with affiliate marketing

You decide who will be allowed to show your products and recommend you to their followers. You also decide how much you will pay for each sale. You can terminate collaborations that you are not satisfied with at any time. In addition, you can have clear rules for where your products and services can be displayed, so you have full control of how your brand is exposed.

However, you should bear in mind that it is good to be aware of the type of affiliate you want to work with primarily at the beginning of your journey as an advertiser. For example, if you are not interested in cooperating with discount code sites, this should be stated in your advertiser presentation. Then you make it clear from the start and avoid getting traffic that you don't want.

3. You reach new target groups

Even if you choose a certain website or influencer because you are a good match in terms of target group, you should know that this collaboration can ultimately lead to you reaching new target groups that you didn't even think about. This is part of the power of social media sharing. Spreading takes place in an organic way, so that more people who may have an interest in what you sell discover you and your business.

If you are looking for new customers and do not want to spend a lot of money on a new market analysis, collaborations with affiliates can provide very valuable insights. The difference is that this happens in a more organic way, and in a way where you only pay for results. 

3 Benefits of Affiliate Marketing – affiliates

You can start monetizing your content that you are already creating today by becoming an affiliate. There is no upper limit on how much you can earn, it is based on how good you are at driving traffic that converts to a company's website. You become your own boss and work when, where and how much you want. And as "commercially driven" as you wish.


Affiliate marketer making money online

1. It costs very little to get started

Getting started with affiliate marketing costs more or less nothing for you as an affiliate.What could set you back a few dollars is if you need to buy web hosting for your website, have flashes for better lighting or a microphone - but these types of costs are not a must to get started. With affiliate marketing, you also don't have to deal with any product development, warehousing or logistics. You only need to produce content that is relevant to those who read what you produce to succeed in making money as an affiliate.

2. You earn extra money

As an affiliate, you earn based on how many clicks or purchases you can generate for a company via your platform. This means that there is no ceiling on how much you can earn, it is up to you how well you perform. If you have another job, affiliate marketing is a good side income, but it can also generate a salary as a full-time job if you are good at it. There are also several different examples of talented entrepreneurs who have made multi-million dollas "exits" by selling websites relying entirely on generating income via affiliate marketing.

When the content is published, you as an affiliate can also earn money when you are not "actively" working on it. This makes affiliate marketing an attractive option for those looking to make passive income.

3. Flexibility - both when, where and how!

Affiliate marketing gives you as an affiliate full flexibility to choose which products or services you want to market and how you want to market them. There is no limit to the number of affiliate programs you can participate in, which provides opportunities to work with several companies at the same time. Plus you can choose where you want to work from, when to create your content and how much you want to work. It is very flexible because you do not commit to how many hours you have to work, as would be the case in most workplaces. But a more ambitious approach to your journey as an affiliate usually provides the best results, obviously.

Why SEO is important for you as an affiliate

If you want to become an affiliate but don't want to market yourself through social media platforms such as Instagram, Facebook, TikTok or YouTube, you can work with affiliate marketing through one or more of your own websites, usually in the form of blogs or comparison sites, and this is where SEO (Search Engine Optimization) becomes important.

If you don't want to spend a lot of money on Google Ads, then focus on working more with SEO to drive organic traffic. Organic traffic is the traffic you didn't pay for, but the traffic that comes to your site through a Google search result. For example, if you were to write an article comparing 10 different lawn mowers, a visitor could find that article by searching for "lawn mower best in test".


Search Engine Optimization - SEO


By optimizing your website to rank high in search results, you as an affiliate can attract a large amount of visitors without having to spend large sums on advertising. If you rank high on google, you have a better chance of getting visitors to your site and a better chance of making more money.

Tips for those who want to start with affiliate marketing

How do you start with affiliate marketing? It may seem difficult, but here are three tips on what you as an affiliate can think about before you start your journey to become an affiliate and start making money from your content.

Choose relevant companies

In order for you to earn as much money as possible, our best tip is to only cooperate with companies that have products or services that are relevant to your audience. Only partner with companies that provide genuine value to your audience and that resonate with your own values. Based on what you publish today on your channel or website, what kind of collaborations would your followers or visitors appreciate? If you have a blog where you write a lot about food, a collaboration with a brand that sells something related to food is probably something your audience would really love. But you know your audience best, base it on what you think your followers or visitors want to see for collaborations to earn as much money as possible without damaging your credibility.


Build your website or channel

In order to grow your channel or get more visitors to your website, test yourself to see what works for you. Is it trending sounds, hashtags or an article where you put extra emphasis on SEO-optimized content that got the most views or visitors? Build your website and channel to continuously grow your account to increase the chances of earning more money. But think quality before quantity and post regularly, Google and social media algorithms reward people who show up regularly.

Be patient - don't give up

To make money through affiliate marketing, you have to give it time and not give up too soon. That has to be the most common mistake we see every single day. You will need to post regularly on your channel or website and you need to ensure that your content is of high quality. But if you are consistent, you can manage to make money if you work with affiliate marketing. We see evidence of this every single day on our platform.

Test your way around with different advertisers and see what your target audience interacts with the most and learn all the time. This will increase your chances of a successful collaboration with an advertiser. We often talk about the fact that it can take up to a year to create a full-time income for yourself. Invest in yourself and give yourself access to that opportunit by investing  a solid amount of time before you give up on your dream to be a full-time affiliate marketer.

Frequently Asked Questions About Affiliate Marketing - Advertiser

How much does it cost?

It is usually completely free to register as an advertiser on an affiliate network. We at Addrevenue, for example, work completely without start-up fees or fixed monthly costs. You don't pay for clicks and traffic. You only pay your affiliates when sales have been generated through their links.

What types of affiliates are there?

There are many different types of affiliates that exist on different platforms, here are a few:

Blog - A blog that reviews products and recommends them to readers.

E-commerce - A website that sells its own products and also promotes affiliate products.

Youtube - A youtube channel that reviews products or does unboxing/hauls.

Instagram - An Instagram account that posts about products or services, with affiliate links in the bio or in stories.

What is the commitment period and cancellation period?

This varies between different affiliate networks. But we at Addrevenue work without any commitment period and only a one-month notice period. We believe in our business model and that you should be on the platform if you see value in it. We therefore choose not to lock our advertisers into long contracts.

Is it difficult to get started?

No, not at all. The whole process usually takes between 1-2 hours effective time from start to finish. There are simple guides for installing the necessary tracking code, but if you get stuck somewhere along the way, the affiliate network staff is there to help you.

Affiliate Marketing FAQs - Affiliate

Is it difficult to get started with affiliate marketing as an affiliate?

No, not really. You register as an affiliate in a minute and, if approved, apply to the advertisers you find interesting. When an advertiser approves your application, you can create links and start driving traffic from your channel that hopefully leads to sales.

Do you have to have companies as affiliates?

There are some affiliate networks that require you to have a registered business. But several offer you to be a private person and work with affiliate marketing. For example, several networks cooperate with the operator Gigapay, which offers a simple self-employment solution, with tax and employer's contribution, so that you get the money quickly and smoothly, without any hassle.

How much money can I earn as an affiliate?

This depends on how much traffic you drive to the advertisers or specifically how much this traffic generates conversion. In some cases it can be fixed amounts per conversion and in other cases a percentage of the sale. Exactly what you earn per conversion is shown on the advertiser's page inside the platform. But to give you a more concrete guide, we at Addrevenue have produced a compilation from our own platform on how much money you earn per click in different categories (insurance, sports & leisure, pets, etc.). Feel free to visit that page and browse through the statistics.

Heimar Svensson
CEO & Co-founder
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