Affiliate marketing

Affiliate marketing is a digital marketing strategy in which a company pays external partners (called affiliates) a commission for each sale, click, or other agreed-upon action that these partners generate through their promotional channels.

How does affiliate marketing work?

1. Merchant (advertiser) – A company that sells a product or service and wants to increase sales through affiliates.

2. Affiliate – An individual or company that promotes the merchant’s products or services and receives a commission for each successful conversion. This can include bloggers, social media influencers, website owners, etc.

3. Affiliate network (optional) – A platform that connects merchants and affiliates and handles conversion tracking and payouts (e.g. Amazon Associates, CJ Affiliate, ShareASale).

4. Buyer – The end customer who makes a purchase through an affiliate link.

Affiliate Marketing Commission Methods

- CPS (cost per sale) – Commission for each purchase made.

- CPL (cost per lead) – Commission for each customer acquired (e.g., newsletter subscription).

- CPC (cost per click) – Commission per click on an affiliate link.

- CPA (cost per action) – Commission for a specific action (e.g., application download, registration).

Advantages of Affiliate Marketing

✔️ Low start-up costs for merchants

✔️ Additional earnings for affiliates

✔️ Passive income potential

✔️ Measurability and flexibility

Disadvantages of Affiliate Marketing

❌ Possible fraud with fake clicks or sales

❌ Dependence on merchant or platform rules

❌ Time required to establish a successful strategy

Affiliate marketing is a popular strategy in e-commerce and online marketing because it can help businesses expand their reach and affiliates can create a stable source of income.