During the golden era, the amount of money that one received was higher than the work one used to put in by manifolds. As decades passed by, the income in return kept on reducing though. On the contrary, general prices of the essentials and other necessities skyrocketed. This has brought up a situation where endless time put into work does not yield a sufficient income. In this situation, the chances of finding a well-paid job with humanly possible working hours are close to zero. How will it be if the working hours could be divided among other people? This solution is termed affiliate marketing.
Affiliate Marketing: Definition
Affiliate marketing is the act of marketing a product through other companies or individuals in return for a commission or a share in the profit earned.
The individuals can be ordinary people at the same time can also be bloggers and influencers. Bloggers can write reviews about the product to persuade the readers to buy them. Influencers can make up the content, including the product, to market them to their viewers. There are a lot of companies as well who take up affiliate marketing as a business.
Let’s take an example. Suppose a company named X Ltd. produces a pen. The company decides not to take up the marketing activities themselves. Instead, they choose to appoint other companies or individuals to market it. For that, the companies or individuals will be paid a commission whenever someone buys the product through them. This is the essence of affiliate marketing and the companies or individuals are known as ‘affiliates.’
What Makes Affiliate Marketing So Intriguing?
Affiliate marketing can be summed up as an appealing marketing job. It has its benefits for both the manufacturer and the affiliate. First and foremost, higher the number of customers an affiliate can gather, more income for both the affiliate and the company. There is no end to the amount earned through affiliate marketing.
From an individual’s perspective, affiliate marketing is like a chain reaction. It is initiated from the first few successful sales through their marketing efforts. After that, the customers will help market that product and the end benefit will fall upon the affiliate’s shoulders.
Why An Urban Dream Coming True?
Here comes the justification of the statement that affiliate marketing is an urban dream coming true. As stated above, affiliate marketing for an individual is like a chain reaction. Each time an affiliate successfully sells a product to an individual, he becomes a customer. This customer enhances the affiliate’s marketing power. This happens because if the customers are satisfied, they will market the product in return.
The customers will then direct new individuals to the affiliate. Then it’s the affiliate’s job to turn them into new customers. In theory, the income gained in return to the working hours is increased. This is because the productive working hour of the affiliate is divided among other individuals. Through affiliate marketing, theoretically, an individual can earn even if he cannot put in the efforts due to various reasons.
Here is a video of me explaining what is affiliate marketing and making money:
Benefits Of Affiliate Marketing To The Manufacturer
Affiliate marketing has a lot of advantages from the manufacturer’s perspective as well. Some of them are listed below:
1. Wholehearted involvement of affiliates: Affiliate marketing pays only for action. This means that the commission will only be paid if the sale takes place. This will psychologically persuade the affiliates to give their best efforts. This factor also motivates the affiliates to increase their efforts to increase the number of sales, thereby increasing their income as well.
2. Increases company goodwill: Affiliate marketing is mostly a satisfaction based model. This means that sales and marketing only take place through satisfied customers. Along with this, if the affiliates are well-known bloggers or famous influencers, their followers will have more faith in the product.
3. Less costly than direct marketing: affiliate marketing is less costly than direct marketing. This is because the payment made to affiliates is in the form of commission. The commission constitutes a tiny part of the profit earned from the sale. On the contrary, direct marketing requires advertisements and placements to executives. That costs a much higher amount. As a matter of fact, the payment for affiliate marketing is made after a product is sold. On the other hand, direct marketing takes place before sales. Hence returns for affiliate marketing are 100%. This makes it a much safer and robust method of marketing. The burden of the payments is also taken by the volume of sale. Thus it puts less effect on the company.
4. Rapid boom in sales: famous bloggers and influencers have a huge following. If they become affiliates, then they can easily persuade their followers to buy the product. The impact of their efforts will cause a massive and sudden boom in sales. This sudden boom will initiate further sales by giving an enormous head start. Furthermore, this boom in sales will take place due to many different affiliates. This will increase the market penetration of the product as well due to the increased reach.
All of the statements made above show that affiliate marketing is an ideal marketing tool for both the manufacturer and the affiliates. From the manufacturer’s perspective, it is a risk-free and highly effective tool. It does the job of increasing sales as well as growing goodwill for the company. Affiliate marketing also helps the product to penetrate the market with more ease.
From the affiliate’s perspective, affiliate marketing provides a high-income potential job in a freelancing model. It enables them to share their adequate work time. Theoretically, they can earn more by working less. This type of working model is hard to find and is very appealing. Thereby the chances of growth of affiliate marketing are high.
Affiliate marketing signifies the growth of the marketing model. It is the merging of old and new forms of marketing with urban lifestyles and goals of the current era. Hence, affiliate marketing is one of the best business model to start today. eCommerce is also a popular way to make money online from home. You can read my article on affiliate marketing vs eCommerce to understand more on the difference.