by Todd

October 28, 2018

what is an affiliate marketing business image

What is an affiliate marketing business and why do so many people want to get into affiliate marketing?

For good reason.. High Income Potential & Low Start-Up Costs make this business model a winner.

Affiliate marketing is simply promoting someone else’s product for a cut of the commission.

How you market your affiliate products makes all the difference in online success or failure.

So.. Let’s explore what is an affiliate marketing business; is it the right business for you, and if so, how you can create your own affiliate marketing business today.

First off…

What is an Affiliate Marketing Business?


An affiliate marketing business can be thought of in two unique perspectives.

1.) From the perspective of the owner of a product that wants to sell a product through an affiliate network or directly on an affiliate website.

Or

2.) As the Affiliate Marketer who advertising that product on their website, then receives a commission when a sale is made from said product.

A group of people smiling with the text affiliate marketing above them


The relationship is mutually beneficial because both the Product Owner and Affiliate Marketer have the same goal…

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TO MAKE ONLINE SALES!

Affiliate Marketing is a commission based form of sales where you, as an Affiliate Marketer, receive a commission from the product owner once the sale is completed.

The Affiliate Marketing Purchase Cycle:


When a internet user comes to the affiliate marketer’s website and makes a purchase, here’s what happens.

    • The affiliate website gets a commission.
    • The owner of the product gets a sale.
  • And the customer gets whatever goods or services they wanted to buy.

Easy Peasy, Right?

Still confused? See the diagram below for clarification.

A graphic that shows how an affiliate marketing business works.

The commission to the affiliate website is paid by the product owner and does not cost the customer any extra fees.

So essentially in any affiliate marketing business, there are 3 – 4 players in each transaction.

The Affiliate Marketing Players:


1.) Internet Customer – They click the affiliate link (text link or affiliate banner) from the Affiliate Marketer’s website.

2.) The Owner of the Product – They offer an affiliate relationship to the Affiliate Marketer either through themselves directly or through an Affiliate Network. (discussed in point 4.)

3.) Affiliate Marketer – This can be any website or blog owner.

In affiliate marketing, the marketer is also referred to as the Publisher. This makes sense, since the affiliate marketer is publishing content that is getting ranked and generates traffic, this in turn results in affiliate sales.

4.) The Affiliate Network – This is where Affiliate Products meet Affiliate Marketers.

Affiliate Networks provide a structural system to the whole process. They handle the payments, shipments, and customer returns for both parties.

Note: Affiliate Products can be a service, retail good, digital product, or educational program.

Some affiliate products, like membership packages, allow the affiliate marketer and product owner to receive reoccurring commissions/sales on a monthly or yearly basis.

What Type of Affiliate Marketing is Right For You?


An affiliate marketing business really depends on what role you have in the transaction.

1.) You, most likely, won’t build an Affiliate Network:

An affiliate network is a large scale and massively expensive business to start up. This won’t happen for most, especially an individual.

A word cloud showing the words affiliate marketing and model, profit and related terms.

Examples of affiliate networks are: Amazon Associates, eBay Partners, Linkshare, Sharasale, Clickbank, Commission Junction.

These are the big guys and so discussing this style of affiliate business won’t be the focus of this article.

2.) You Can be the Owner of the Affiliate Product:

There is a good amount of potential income in this profession, but the risk is high.

You have to realize that you need an awesome product and funds to back it up.

You’ll be looking at spending 1,000’s if not $100,000 of thousands of dollars in capital for product development, patents, samples, product testing, importation fees, quality control issues, etc.

Not to mention the incredible amount of RISK if your product flops and doesn’t sell at all.

A graphic with a laptop, cash, and the words "affiliate marketing"

3.) Affiliate Marketing is a Nice Middle Ground for Everyone:

This is where we want to focus our attention.

Being an Affiliate Marketer provides the average person some amazing advantages and opportunities to break into the affiliate marketing business.

The most notable advantage is the low cost start-up fees.

To start a niche website costs next to nothing ($5/mo in website hosting, $15/year for a domain name).

The cost of education can vary as well as the quality of training.

But your initial education fees can be between $30 – $50 USD/mo. The key is picking the right education.

And the key ingredients are: you need to be willing to work hard and be dedicated to your business.

You also need the ability to gain some marketing skills and learn new information.

It’s like any professional career, the more you know and practice, the better you become and the more success you will have.

Affiliate Marketing On A Budget:


Most people don’t have the capital or resources to start an Affiliate Network.

This is usually reserved for the big boys like Amazon Associates – So this business is not going to work for most folks unless you get a job with an affiliate network.

You could be the Product Owner if you have a cool product idea as well as a good amount of capital to create and supply your product.

Then you can approach any of the Affiliate Networks listed above to get your product listed within their network.

This is a rather inexpensive form of advertising and requires little effort on your part. You would just need to get affiliate marketers to promote and sell your product.

If you don’t have a product to sell and still want to get in on the action, start with affiliate marketing as an Affiliate Marketer.

The reason I recommend this is because you still have the huge income potential, but you loose all the negative aspects that go into selling your own products online.A stock image showing people working through the internet

And that is..

  • Products to Purchase
  • Inventory Storage
  • Risk if your Products DON’T Sell
  • Importation Fees, Shipping Costs, etc.

So what does it take to become an Affiliate Marketer?

Become an Affiliate Marketer – In 3 Simple Steps


1.) Find Your Passion:

Find a niche idea that is based on something you are really passionate about.

Whether it be sports, traveling, arts & crafts, whatever it may be, take some time to think about what you really want your website to be about.

Also, I always encourage potential affiliate marketers to go into this field with the intention of helping people.

We all know that money is the key motivator, but start your affiliate marketing business with good intention, forget the money, sandy beaches, and work wherever lifestyle.

Base your niche on something you love and you won’t regret it.

Special Note: Do a little research on your niche. Does it have products that you can affiliate yourself with? If it doesn’t, back to the drawing board.

2.) Be Realistic with Yourself:

Most people get into affiliate marketing with the expectation that they will be making killer money in no time.

Sorry friends, it doesn’t work like that. You need to realize that it takes time to build your website and your skills.

Depending on how competitive your niche is, it could take as long as 3 months to a year before you start seeing income.

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If you niche site or blog is very specific, you could be making regular income between 3 – 6 months.

But if your niche is more competitive, it could take up to 6 months to a year or more before the money starts to flow.

This can be a tough pill to swallow for most, but for those that can handle this and continue to work on their affiliate marketing websites, you’ll find the rewards to be incredible.

Rome wasn’t built in a day, and neither is an affiliate marketing business.

If you can’t except this, then affiliate marketing may not be right for you.

A graphic of the words make money and a computer mouse.

3.) Get a Solid Education in Affiliate Marketing:

For those that are serious about affiliate marketing, I highly recommend you start with a sound educational program. If you try to go at this alone, you will most likely fail.

You have to understand how to write web content that ranks, how to do keyword research, how to develop a professional website, and how to structure your affiliate links strategically.

The educational program that I recommend to learn affiliate marketing is through a company called Wealthy Affilaite.

They provide structured step by step video courses that are easy to follow and you build your affiliate marketing business while you learn.

You will have daily classes and tasks to complete. And pretty much every internet marketing topic you can think of is covered within this training program.

It’s like going to college, you have to learn, work hard, and apply what you learn to your affiliate business.

A picture that links to an online marketing course to build your own affiliate marketing business.

In Conclusion:


Affiliate marketing can be a passive source of income, part time income, a full time career, and/or a money making machine.

It depends on your niche, how hard you work to develop your website, and the educational system you use that will determine your level of success.

If you know of anyone that will benefit from this article, please socially share this post using the social share buttons.

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And if you have any questions on what is an affiliate marketing business, let me know and I’ll be happy to get back to you.

About the author 

Todd

Hi, I’m the founder of Learn to Grow Wealth Online. My goal is to help you create a brilliant online business. One that is profitable and will grow wealth for you and your loved ones well into the future. If you're willing to put in the effort, I can help you create your own source of online income.

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  1. Thanks for sharing nice info about Affiliate marketing . Recently i learned digital marketing training from digitalkora. It was a nice experience to learn advanced modules. I am going to implement this techniques for my website very soon.

    1. Thanks for your feedback Joseph on affiliate marketing. It’s great to get a couple affiliate marketing strategies that work consistently and then to implement new ones. Or, if you’ve taken our Free Training Course you can learn how to build a consistent stream of internet traffic and then add in other internet marketing techniques like selling eCommerce products on your site. Even you’re own digital courses.

      Best of luck to you Joseph

  2. Hi,
    Thanks for sharing useful information regarding an affiliate marketing business. I will regularly follow this site for daily blog posts. Thank you for updates. Myself Arif recently completed my training in digital marketing.

    1. Awesome Ghouse, thanks for your feedback and best of luck to you. Affiliate marketing and selling digital products is a great way to start and run an online business. Good for you!

  3. Hi,

    Thanks for sharing useful information regarding Affiliate marketing business. I will regularly follow this site for daily blog posts. Thank you for updates.

  4. Your post was very helpful for me. Thank you a lot. This will help me very much in affiliate marketing. Please keep posting. I wanna know more about this topic. I wish you will keep posting and help us in this way. I will be waiting for the next one. God bless you.

    1. You bet Faisa, happy to help. If you’re ready to take the next step, you should take our Free Internet Marketing Training Course.

      It’s got everything to help you get you affiliate marketing business up and running plus all the continued support to keep you moving forward.

      The community is amazing.

      Hope to see ya on the inside,
      Todd

  5. Hi, nice your article and I’m interested in ecommerce and also thanks for information on affiliate marketing. So I was thinking about how I can start up my own product line. Any resources?

  6. Thanks for sharing this blog. Affiliate Marketer is someone who advertising that product on their website, then receives a commission when a sale is made from said product.

  7. If you don’t have a product to sell and still want to get in on the action, start with affiliate marketing as an Affiliate Marketer. I like this part of your writings because it teaches me so much important issues to consider before some one decides to be an online marketer. Is good to understand how the business works and be patient on the business.

    The reason I recommend this is because you still have the huge income potential, but you loose all the negative aspects that go into selling your own products online. This post also has helped me understand how to create a successful affiliate marketing business that I just closed my Amazon account because I was paying Amazon’s fees and not yet selling and making money.

    Thank again, I now understand how is important to follow the classes on WA..keep it up and all the best to your online business.

    1. All the best to you too Lucy. Stick to those classes religiously. The Wealthy Affiliate’s educational program has been the difference in my online success.

      Without them and the support of the WA community, I would have given up on my affiliate marketing business along time ago. I’m glad I didn’t because now I have a sweet passive income source with this site that grows daily and I’m building another site that’s really going to be big.

      It does take some time and I’m glad you understand this. How much time does it take to make money online? Read this post for my honest answer.

      Treat an affiliate marketing business like going to college, and you’ve got it made.

      Best of luck to you too,

      Todd

  8. I think this site has great insight on what it entails to build an online affiliate marketing business. The process that you have to go through as well as the how to’s.

    Many people are of the impression that having an online business is easy and quick, but this website allows the reader to understand that like anything else, you have to crawl before you can walk.

    It also disarms many other websites that mislead people into believing that most of them are the way out, by feeding them that get rich quick facade.

    The good thing is that most people have already gotten hip to all these scams. I must say that I enjoyed reading through this site and applaud the creator for going in depth and being so detailed. Thumbs Up!!!

    1. Hi Dorian,

      Thanks for the feedback. I think it’s important that people who are are looking at making money online or starting an affiliate marketing business know what they’re getting themselves into before they invest a lot of time and money.

      Learn what is involved in creating an affiliate marketing business is critical before you begin the process. If you can invest the time like you’re going back to college, you’ll do so much better and eventually be able to hit that goal of building a successful online business. Affiliate marketing is just one of the best styles of marketing because it doesn’t cost a lot but once you build up the traffic, can have a great return on your investment.

      Thanks,

      Todd

  9. Hi Todd. I love how you define affiliate marketing and how you describe it. I agree with your four requirements that you mentioned. The right amount of education, training, support and personal guidance. Overall a strong foundation needed to start an affiliate marketing business. Using diagrams also makes affiliate marketing an understandable topic.

    1. Thanks Kathe,

      I really appreciate your feedback on our affiliate marketing business post. There’s a lot of people who search about affiliate marketing and how to create a successful online business from it, and so I just want to make it really clear what it is, the advantages of affiliate marketing, and how to get started – if that’s something that one is really interested in doing.

      I love affiliate marketing because of the low risk involved as far as a business startup goes, once you get the foundation to your affiliate marketing based website, then you can produce quality content and bring thousands the website visitors to your site on a monthly, daily, or even hourly basis.

      That’s what is so cool about online businesses, they run 24 days a week 7 days a year and that equates to a lot more total sales.

      If you need help with affiliate marketing, go with the pros at Wealthy Affiliate. It’s who I used to create my online businesses and I couldn’t recommend them any higher.

      Thanks,

      Todd

  10. Hi Todd

    Thanks for the posts. Reading your articles is definitely a good part of my training. The inside scoop puts the whole what is an affiliate marketing business into perspective and the 5 best free stock photo story is very useful. I’ll be using them a lot as I build my own affiliate marketing business. Thanks.

    1. Hi Bob,

      That’s great feedback and I think you’ll be happy with your affiliate marketing business if you focus on supplying plenty of high quality content based on your niche business.

      Once you do that and can really connect and help your niche audience, you’ll find your online business really takes off.

      I’m here to help if you have any other questions about stock photos or affiliate marketing.

      Take care,

      Todd

  11. This is an excellent site. I learned a lot form reading your post on creating an affiliate marketing business.

    Have you been affiliate marketing very long? It seems any sort of online marketing is getting more and more competitive and I wondered if you have a few tips you can pass on to help rise above the crowd. Do you build your won pictures? If no where do you find them?

    1. Hi Margaret, I get my pictures for free using a few services. Check out this post to learn how.

      I’ve been affiliate marketing and building my online businesses for almost 2 years now. I make money online every day and initially, you have to put in the hours and create meaningful content that helps people.

      As time goes on and you understand SEO, structuring your content and how to rank quickly, it becomes a much easier business.

      Remember, the longer that your site exists, and the more quality content that you publish, your site will rank quicker and higher. And more traffic means more affiliate commissions.

      So my secret is simple, I didn’t waste time problem solving the various tasks that I didn’t even know that I should do. I went with Wealthy Affiliate’s training program and every day I had tasks that were building the foundation to my online business.

      Now I send 5 hours per week, spend $2.13/day for my online businesses and make thousands of dollars per month in return, what more could you ask for.

      Point is, if you want to know what an affiliate marketing business is, this is the post and Wealthy Affiliate is the source to make it happen, there’s just too many benefits from working with this organization.

      Hope that helps,

      Todd

  12. Hi Todd,

    I’ve had a good read on your post. You took the time to take a novice through the path of affiliate marketing.

    If I wasn’t already making money online with my affiliate marketing business, I’d follow your suggestions, your post was strong enough to convince me. You’ve done a nice job explaining the benefits of creating an affiliate marketing business, and this will help many who want to do the same thing..

    Wealthy Affiliate is the best and you’ve done well to prove that it doesn’t promise a get rich quick business but a “get rich sure” business.

    I’m glad I read this as I’m more inspired to step up my game.

    Cheers!

    Nnanna.

    1. That’s great to hear Nnanna. With Wealthy Affiliate’s training and a take action attitude, you will achieve all your online goals and more. I really couldn’t be happier with the education and training they’ve provided me.

      It’s actually refreshing to learn white hat SEO to create a long term online business that pays you time and time again. It’s my favorite part to creating an affiliate marketing business.

      To your success Nnanna,

      Todd

  13. You make it really easy to understand what exactly is an affiliate marketing business. It actually doesn’t sound as hard as I originally had thought. You’ve explained the ins and outs of affiliate marketing really well in my opinion, I love the diagram, very original and eye-catching. Thanks for the great breakdown, I also like that you recommend Wealthy Affiliate. I’ve been working with them to create my own niche affiliate business and I’m loving the results.

    Thanks for the great read.

    1. You bet, my pleasure. Learn what is an affiliate marketing business is the first step, then using a affiliate marketing training center like Wealthy Affiliate is the next step.

      If you’ve got ideas for a niche or online business, getting into Wealthy Affiliate’s training program is the next best move you can make. Then it’s simple, take the daily classes and take action on what you learn.

      It couldn’t be any easy with the help from these guys. Thanks for your personal feedback of working with Wealthy Affiliate as well.

      Best of luck to you with your online business.

      Todd

  14. Hey Todd,

    Loving your post, Affiliate Marketing is fun and I’ve been doing it for the past year. We can choose any niche imaginable, find products to promote and BAM money come in by writing about what we love.

    Its so much simpler than creating your own product an I would advise any beginner who’s serious in building a long term online business to start with affiliate marketing.

    1. Hi Riaz,

      You’ve got it my friend. The low cost of start up, the ease of creating traffic based on something you love and the ability to help people and make good money online is what makes an affiliate marketing business my number one way to make money online.

      All it takes is a bit of passion and hard work and anyone can make it happen. Especially when you have a proven system like Wealthy Affiliate on your side.

      Thanks for your feedback,

      Todd

  15. Hi Todd, I think that affiliate marketing is a great way of starting an online business. I like the fact that the entry costs are low and that you do not have the hassle of dealing with customer issues and taking payments. You simply introduce potential customers to the seller’s website.

    I have been making money with affiliate marketing for quite a while. I have learned a lot of things as a result of being a Wealthy Affiliate member and would recommend it to anyone who wants to make money online.

    Best wishes
    Mark

    1. Hi Mark,

      Thanks for your feedback and it’s good to here your affiliate marketing business is treating you well.

      Absolutely, not having products to buy, inventory that may or may not sell, and ZERO customer service issues are some of the Pros to having an online business that’s based on affiliate marketing strategies.

      All you have to do is find a niche, create quality content that is designed to help people within your niche and anyone can have a thriving online business.

      It’s definitely something that that is financially rewarding as well as emotionally satisfying.

      Thanks again for your feedback and have a great week,
      Todd

  16. Hi Todd,

    You have done a great job explaining what affiliate marketing is all about. For a time I did consider marketing my own products on Amazon, however, in the end I chose affiliate marketing.

    Perhaps the rewards are not so great, but the risks aren’t so great either. Being an affiliate marketer, you can start with a very small investment and if you have the motivation anyone can do it.

    I like the fact in your 3 steps, you warn people not to expect success too quickly, it is important to point this out. Also an education program that teaches all you need to know about starting an affiliate marketing business, is probably a necessity if you are serious about making money this way.

    Thanks for the clarification on affiliate marketing.
    Peter

    1. Hi Peter,

      Nice to hear from you. A year ago I didn’t know what an affiliate marketing business was and was only really familiar with selling imported products mostly on Amazon and eBay.

      The money was good, but the risk was super high, I still have over $2,000 dollars worth of cell phone cases that are sitting in a garage collecting dust. And although importing goods into Amazon was a fun process and taught me the power of online sales, the long term possibilities of this type of business come with too many drawbacks.

      Affiliate marketing businesses take more time to nurture, but with a better end result – you still make Sales that originate from work you’ve already completed, but you don’t have the risk like you do with importation. So in this sense, affiliate marketing provides the best long term business model.

      And like you pointed out Peter, the low risk of affiliate marketing is wonderful.

      As far as the 3 steps to making affiliate marketing work for you, I think it’s best to know that it’s going to take some effort and time before you start making good money in affiliate marketing. This is just the truth, people need to be educated about making money online before the money starts to roll in.

      Everyone wants to do it, few know how, and most have unreasonable expectations. I always use college education to explain this and that’s just because I think it’s easy to relate to, and that is – you don’t expect to be a doctor or any other professional degree in a couple of weeks, so this is no different.

      At least with affiliate marketing, you can start to earn some money after a matter of months as you continue to educate yourself, and not a matter of years. It took me 7 years to become an Occupational Therapist so this analogy makes the most sense to me.

      The key ingredients to achieving success in affiliate marketing are: a passion, a good work ethic, and a proper online education.

      Thanks again Peter, hope all is well.

      Cheers,
      Todd

  17. Hi Todd,
    Wow, you did such a great job explaining what is an affiliate marketing business is, very detailed and packed full of fantastic information.

    It’s funny because I was thinking how I can start up my own product line, but It sounds really risky to invest all that kind of money in a product that could do well, or it could just be a flop. As I don’t have that kind of money to invest.

    I know I can make money with affiliate marketing because I have been taught online through they best university there is online, so for myself I think I’d rather play it safe and stick with what I know.

    Great job on explaining everything it definitely helped me in my decision.

    1. Hi Jennifer,

      Glad to hear the post helped you come to a decision. I too have a couple of ideas that I’d like to create as infomercials, but I think that this might be done easier through a traditional affiliate marketing website.

      But it’s an interesting debate, be the affiliate product creator or be the affiliate marketer. For sure, there’s much less risk being an affiliate marketer.

      And I suppose at this time, I feel that’s probably the best decision for most unless you have a specific digital product or service that’s screaming at your heart to be developed and you have the financial support to develop your product, etc.

      Thanks for your feedback Jennifer and I’m glad I could clarify what is an affiliate marketing business for you.

      Best,
      Todd

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