How Does Affiliate Marketing Work As An Online Business?

In theory, affiliate marketing is simple:

  • Pick a niche
  • Find products to promote
  • Create a website or a social media page
  • Create content ethically promoting the products you’ve chosen
  • Ethically promote your content
  • Collect a commission when someone buys a product via your niche

As always, though, the devil is in the detail. Each of those simple points hides a multitude of things so let’s go into a bit more detail about how affiliate marketing works “under the hood”.

Picking a niche

niche marketingThe niche you choose should be in the Goldilocks zone – similar to the one used by scientists to try to work out if a star has planets with the chance of supporting life.

Much like the porridge that Goldilocks chose – which wasn’t too cold or too hot – the niche you choose should be as close to “just right” as possible.

That means there should be a sufficient number of products to promote – I like to have similar products available from several suppliers for any niche I choose. The reason for this is that you don’t want to be reliant on one supplier because if they change their business model (as Amazon have done at the time of writing) you’re left high and dry, with content but no easy way to monetise it.

Too much competition means you either need to choose a different niche or you need to drill down to a narrower niche. You don’t want to be a minnow as the chance of you getting lost amongst the competition is too high.

Equally you don’t want almost no competition – that probably means the niche you’ve chosen is too small.

There’s no precise science for this – gut reaction takes a lot less time than days or weeks of research and is just as likely to be “right”.

Aim for your research being “good enough”.

Find products to promote

This will confirm your niche research.

Again, you’re looking for a reasonable number of products from a reasonable number of suppliers so you’ve got a built-in comfort zone in case something changes. And you can guarantee something will change – that’s the nature of the web. There was a time when Google wasn’t the dominant search engine and Amazon wasn’t the dominant shopping channel. Whilst neither of those are likely to change any time soon (probably!) in any other area, there’s likely to be a constant change.

The products need to be things people are buying – there’s a reasonable chance that if a product is available for you to promote, it’s being bought.

And because you don’t want to be monitoring the products you’re promoting constantly, it’s a good idea to promote products that have been around and stood the test of time.

Sure, pet rocks sold for a while in the 1970’s but they were a craze.

Crazes are great to be on at the time but if your timing is wrong – especially with the amount of time it takes to get indexed nowadays – then you’ve spent a lot of time and effort for little, if any, return. You’re running the risk of creating the internet equivalent of a ghost town and there are plenty of sites that are just that.

You’re far better off with an evergreen set of products – ideally ones that sell reasonably steadily all year round. You can branch out to more seasonal niches later but when you’re first starting out, your income will be less “lumpy” if you keep away from things with too much seasonality.

Create a website or social media page

A website is better in my opinion – you’re much more in control. You’ll need a domain name and somewhere to host it and then WordPress to quickly create your site.

A social media page is quicker – you can set one up in places like Facebook or YouTube within a handful of minutes. But you’re reliant on those platforms to not change their mind as to what’s allowable. And, historically, large sites change the rules slightly less often than you change your socks.

Or do both so you’ve got a belt and braces approach.

Create content

Content should be at least written content – web pages, posts on social media, that kind of thing.

Be ethical with what you create and what you say about products – just because you’re earning a commission doesn’t mean the product is perfect and suits everyone. Introducing the occasional negative into your content and – ideally – a workaround for the negatives makes it a lot better and a lot more believable.

After all, if I told you Windows or your phone software didn’t have bugs and niggles, you wouldn’t believe me,

The same applies to anything else you’re talking about.

And the closer you can get your content to being something a trusted friend would tell you while you were chatting over a cup of coffee (or something stronger), the better.

Which also means you’re free to write in a way that would freak out your English teacher. Mine have been freaking out about my writing style since my age was still in single digits but a conversational style where you can almost hear the voice on the page works a treat.

Likewise for videos – don’t go for a Hollywood production value. Be OK with stumbling over your words occasionally. If you use your phone for videos, it’s OK to have a bad hair day. I don’t like being on screen (never have – it’s the wrong end of the lens as far as I’m concerned) so I use some quite cheap software to create professional looking videos and then do a voiceover using my own voice. Mainly because some people on my channel said they didn’t like the computer generated voice that I use originally and I took their words to heart.

The “trick” with content is keep producing it.

Long tail content works best unless you’re happy to wait an inordinate amount of time to maybe show up somewhere in the search results that people might find you.

Far better to go for the fruit that’s so “low hanging” it’s almost rotting on the floor. Because there’s still more than enough traffic available at this neglected end of the search market and because you’ll show up higher in the results faster. Because you’ll be one of only a handful of people in the world creating content for these obscure but still searched for phrases.

They add up. A click or two a day here, a few clicks a day there, times lots of content equals a decent amount of visitors to your site and some revenue.

If you commit to regularly producing content – that really does mean regularly, not once in a blue moon – you’ll start to see the benefit in a few months time.

Promote your content

Liking it on Facebook, Twitter, etc. is one way of doing that.

I always make sure to watch every video I create as soon as it’s live. Well, when I say watch, what I mean is open it in another tab, press play and mute the sound in that tab. But don’t tell YouTube!

Encourage others to share your content as well – I use the AddToAny plugin on my WordPress sites to allow visitors to do that.

I also use the Contextual Related Posts plugin to automatically promote similar content on my sites so that visitors can easily explore further if they want to.

If you’re feeling keen (and want to earn more money), start building an email list so you can let people know when you’ve got something to say, including a new piece of content released.

Collect yourcommissions

These should happen automatically – most affiliate programs will pay you directly when your commissions reach a specified level.

It’s a nice feeling to get extra money in Paypal or your bank account.

Initially, these will be few and far between.

But, as you keep at it, they’ll build up and you’ll be hopefully seeing a growing income from your affiliate marketing.

Obviously there are no guarantees – even franchised businesses can’t do that – but so long as you stack the odds in your favour, you should see your affiliate income grow.

And, whilst it’s not something I’ve created, this affiliate training will help as well.