What is Affiliate Marketing and How Does it Work?

      14 Comments on What is Affiliate Marketing and How Does it Work?

The dream of making money through a website is something shared by many bloggers and writers, when they first venture into the online world. However, the reality for many writers is that making money can be hard to achieve, and the most successful bloggers have to work hard and have a clear strategy if they are to be successful.

image tropical dream bloggers dream

For some this is the ideal lifestyle and financial dream – but can it be achieved simply by blogging? (image found on tan cap)

This article focuses on one of the more established ways in which you can make money through a blog site, and that is to use affiliate marketing.

This article looks at what affiliate marketing is and why choosing a niche is the most effective way to target an audience.

Affiliate Marketing – Definition

Affiliate marketing is a term that is used to describe third party marketing. In other words promoting products even though you don’t directly work for the company, but instead you receive a commission for any sales.

A Website

Most affiliate marketeers start with a simple website where they can write content and product reviews. Setting up a website is easy and straightforward and many companies now offer a variety of WordPress themes and a simple hosting service for little overall cost.

image content writing

Affiliate marketing starts small with a basic website (image found on liquidselect.com)

The following articles on this site, will provide you with some extra information on website and hosting information.

Once your website is established the next questions to ask are -how do you know what products to sell and who will buy them?

An Affiliate Niche

One term that is used a lot in affiliate marketing is ‘niche‘.

A niche is a specialised area of the market that will have a targeted group of people interested in it. In niche marketing you produce content and promote products related to this small sector of the population.

Why Choose a Niche?

When you start out in affiliate marketing it can be quite overwhelming. It takes time to process all the information and products that are available in the market. The temptation can be to focus exclusively on the product, rather than the target audience, and the danger with that approach is that products can go out of fashion or lose their appeal.

A niche on the other hand remains static – e.g. over 50s, new mothers, photography group etc. this group will always be present in society and will always be looking for products that meet their specific needs.

Examples of Niche Groups

A niche group can be based on a variety of things such as geography, demographics, hobbies or needs. The aim is to pick a target group and then specialise in information and products linked to that group.

image deciding which niche to choose

For example – if I chose ‘weight loss for women after childbirth‘ as a niche area then I could focus on any of the following topics;

  • appropriate yoga exercises that can be done at home
  • diets including foods for breastfeeding
  • exercises including walking the buggy
  • stress reduction techniques and avoiding stress /sugar burst food

In other words everything you promote or write about, should resonate with this particular audience group.

Niche Topics

If you are thinking about a particular niche group the next stage is to consider some of the topics that you could write about. There is a term ‘evergreen niche‘ which means that interest in this topic remains fairly consistent throughout the year. As opposed to niches such as Christmas, which is obviously more focused on a particular time of the year.

image christmas niche

A Christmas niche is more time specific than an evergreen niche which remain constant throughout the year (image found on christmaswishesimages.org

In order to know which trends are consistent in searches, Google has a special tool that shows the search results trend over the last 10 years.

In Google Trends you can input topics and see the web search interest over the last 10 years. For example if I had chosen a pet theme for my niche, then I might want to compare the interest in puppies versus the interest in kittens over the year.

screenshot google trends niche topcis

puppy versus kitten searches 2005-2015

The chart from Google Trends shows that the interest in puppies has been steadily increasing, whilst the interest in kittens has been declining. Google trends will even give a simple prediction for the forecasted pattern for the next 12 months.

This information can be helpful to determine both a niche area and also possible topics of interest within that niche.

Profitable Affiliate Niche

The final hurdle is to establish whether your niche group is going to be successful and profitable. Although money can be made in most areas of the market, some groups will inevitably be more profitable than others. Below is a simple checklist of things to consider before you decide on a  specific niche.

  1. The number of people in this target group and is your audience big enough?
  2. The needs of this group – what do they want and how badly do they need it?
  3. The products available to this group – are there plenty, is the cost too high or too low,  do the products match the needs you have identified for this group?
  4. The willingness to pay – does the group have money and are they looking to spend it?
  5. Low competition – are there are other sites and products already being sold to meet the needs of this group, can you compete with them realistically?

Willingness to Pay

It is important to target a niche area that will be profitable, otherwise this defeats the purpose of affiliate marketing. Generally you need to find a topic that has a clearly defined target population and which also has a definite need that you could target. However not all areas are equally good at providing profit.

Some niche topics for example ‘housing benefit and assistance schemes’, are targeted at a large population that has a definite need. However it is also a group that has limited resources and is unlikely to pay large sums of money for anything connected to solving this problem.

A niche group such as golf players on the other hand, targets a large population that will be willing to pay money for tips, equipment and other resources to help them improve their game. This niche is therefore a lot more profitable than the housing benefit scheme.

Niche COMPETITION

One of the ways that you can use to find out how popular a niche topic is and whether there are  a lot of competition sites is to use a keyword tool, the example I have used below is from a search for ‘golf’.

Here you can see that there is a lot of traffic and a high number of searches for golf, golf clubs and golf courses.

screenshot keyword search for niche topic

Using keyword tools to find out competition and searches

If I want to look at the competition for the term ‘golf’ I can see that the number is pretty high with over 1,330 million sites. If I start to look more closely at some more specific terms such as ‘golf clubs’ then the competition drops to 412 sites.

screenshot google search competition 'golf'

Niche marketing is looking for these smaller and more specific markets so that the number of competitive sites in Google will be lower and there is a higher chance to become specialised.

Products to Promote

This last category is important to consider but should not be the first factor in the decision. There are lots of products to fill any niche area so there should always be something that can be used. Some niches do offer more options though, such as electronic devices or sports equipment.

Many affiliate marketeers join affiliate companies so that they can choose from a variety of products from different companies. One such company is Sharesale which I use as one of my affiliate companies on another blog site I manage.  These companies provide data and reports on sales and enable marketeers to see which products are being clicked and which articles or blogs are generating the best leads.

Affiliate Marketing

In summary then affiliate marketing is a way in which bloggers can make money through their website. In order to get started you need to remember the following;

  • Build a website – Can be a WordPress theme and doesn’t need to be too fancy
  • Host the website so that it is available on the internet to everyone
  • Select a niche topic – choose a group or interest area that is not too broad but not too small either
  • Select a topic to write about and then choose products to promote, that will appeal to this group

These points are just the basics and provide a good foundation to get started with affiliate marketing. However, in order to be really successful it is important that you receive support, training and access to resources to help you fast-track your business and remain optimistic during the difficult times at the beginning.

Wealthy Affiliate University (WA)

I am a strong advocate in digital marketing of not making this journey on your own. I believe that time and resources are in short supply for many people and there is no point making all the same standard mistakes that other marketing novices made.

Programs such as the Wealthy Affiliate University provide access to video and written training materials, that cover all the basics that you will need to get started and be successful in digital marketing.

In this blog I will cover some of the topics needed by affiliate marketeers, but I am also an active member of WA and I would urge anyone who is serious about developing an affiliate marketing site to join this community. There are a number of immediate benefits that will  get your marketing career off to a flying start.

  1. They offer 2 free websites and hosting
  2. They offer free access to their first module of training with the free starter membership
  3. They have one other level of membership which is the premium rate, you can access everything else at this level  for the equivalent of $27 per month (if you purchase the annual membership option)
  4. They provide free access to a keyword tool
  5. They have a community forum and a live chat feed
  6. The site owners are available to be contacted personally and respond to comments
  7. There are over a 100 different forms of training, video trainings and participant training material as well as regularly updated blogs and inputs from members
  8. If you join through this link I can personally offer you direct mentoring support and answer any concerns or questions that you may have using their private message system.

Support in Affiliate Marketing

Although this last part might sound a bit like a sales pitch I cannot over emphasise how difficult getting started in affiliate marketing can be and how lonely the process seems, if you are not in contact with other similar minded people.

I have also written an article on the benefits of having a mentor. This article lists other gurus in the field of affiliate marketing that may be of help, especially for writing content or developing an affiliate marketing site. Again the message here is to avoid making the same mistakes others have made, and to learn from the experts in order to make smart cuts in your businesses development.

Are You Ready to Start Building Your Own Affiliate Business?

Affiliate marketing can be a very lucrative business and it has many added benefits such  as flexible working times and freedom of location. On the downside it takes a lot of time to get established and gain the trust of both search engines and your target audience.

In this article I have outlined the first steps towards getting a business started and deciding on the topics and products that you want to write about and promote. If you feel you have the commitment and interest to start a new business and work online then affiliate marketing could definitely be an option for you. So why not give it a try and start with the free website option at WA, or if you want to read more about the subject these articles offer further information.

If you have any further questions please feel free to ask them in the comments section below, and best of luck in your own online business.

14 thoughts on “What is Affiliate Marketing and How Does it Work?

  1. Alex

    Hi there,

    I am relatively new to the blog of blogging / affiliate marketing. I knew a little bit about affiliate marketing but not entirely. After reading your post here, I have learned a lot and have a better overview on affiliate marketing.

    It is good to know that I can trace the trend through Google Trend and identify my niche. It may be too late for me, but at least if I am going to build my second site. I can make use of this tool. Do you think it is feasible to run two websites at the same time?

    There are many links to useful tools, training platforms in your article. Thanks for the effort in putting all these. I didn’t know that one can build a website for free. Great article!

    Thanks,
    Alex

    Reply
    1. Marie

      Hi Alex thanks for the feedback much appreciated.

      Running two websites is obviously twice the work – I would say a lot depends on time and personality. Some people prefer to focus on one site at a time, others like to take a break and have a different area to write about. I have two sites but progress on the other one is slower, but then I also do other writing and research work so it’s all about balance.

  2. Christine

    Hi Marie. After reading your article I have a greater understanding of affiliate marketing. I have been surfing the internet looking at ways to earn money and be able to stay at home with my children.

    I need to earn some extra money to help with the household so I don’t have to go out to work and affiliate marketing seems to be a good option for me.

    Thanks.
    Christine.

    Reply
    1. Marie

      Hi Christine that’s great news you have started a long and difficult journey but hopefully one that is worthwhile.

      This post on How to Start An Online Business is the next step that you need to take and which will hopefully start you fully on that journey.

      Marie

  3. Juan

    I have always been curios about finding ways of taking advantage of the online world. It just seems to be such a huge platform with so many opportunities that I feel like I am not taking advantage of.

    Affiliate marketing seems the way to go. After reading your post I realize the importance of choosing the right niche, since this might be the key to making that website profitable.

    Reply
    1. Marie

      Hi Juan thanks for your comment, yes affiliate marketing is definitely one option but like all of them it still requires work and learning.

      The importance of finding a good niche is key, since you will spend so much time working on this topic that it needs to be something that really interests and inspires you. If you are interested in learning more then this article on affiliate training is important to read Raising the Bar in Digital Marketing Training

  4. Pete

    Awesome use of the trends chart within your post. This is something I wish I knew for a long time and really gives you a better gauge of the kind of interest within a certain topic. It’s also great for starting smaller niche websites that aren’t so much evergreen, but has a lot of current popularity.

    I like how transparent you were when talking about the life of a blogger. While it does take some time to get a website going, the rewards in the end are well worth it. With the right attitude and support, I believe that anyone can become successful with it in the end!

    Reply
    1. Marie

      Hi Pete yes I may have emphasised some of the challenges but you are right there are a lot of benefits with affiliate marketing, especially if working from home and being in control of your own work is important to you.

      I’m glad you enjoyed Google Trends, which I think is another important tool along with the keyword tool (Jaaxy a Powerful Keyword Search Tool) to help research the most appropriate niches. Best of luck with your own sites, Marie

  5. Simone

    I am looking for ways that I can make money by working from home. But I want to be my own boss, I don’t want to work from home for someone else. My kids are in school for 6 hours a day Monday to Friday, so I can work on my business during this time.

    I haven’t heard of affiliate marketing and always wondered how websites made money. I assumed the money came from ads that most websites have.

    You have given me a lot to think about. Thank you!

    Reply
    1. Marie

      Hi Simone, working from home is definitely a very real option with affiliate marketing and using ads and other options such as making your own products to sell, are all possible once you have a website.

      Start simple and build you own website with this builder How to Build a WordPress Website and start working from there. Also don’t forget to keep coming back here for all the support material you need to help you along the way, thanks Marie.

  6. Karissa

    Hello,

    I love this post and how you have encouraged people to find a niche that is very specific, because most people pick a very broad topic for their niche.

    You are very descriptive, which is awesome because that is what people need to understand! WA has the best community, and I have nothing but positive things to say about it!

    Reply
    1. Marie

      Hi Karissa thanks for your comments and yes I agree picking a niche is a challenging part of affiliate marketing and many people do start very broad. Do you research and follow your passion would be my constant mantra!

      Thanks for your feedback on WA as well, it does have a strong community feel and can be very supportive for marketeers glad you also find it helpful.

  7. Nicki

    I performed months of research on affiliate marketing and still found it extremely difficult to narrow things down to just one niche. I really appreciate how you’ve broken it down here! It really helps having someone explain the how and why of niche marketing. Thanks to your article, I think I’ve picked my target audiences!
    Thank you!
    -Nicki

    Reply
    1. Marie

      Hi Nicki, that’s great news since finding a niche and a target audience is perhaps the single most difficult part of affiliate marketing.

      Now you just need to produce good quality SEO content, which you can find starting with this article How to Write Quality SEO Content, best of luck, Marie

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