Affiliate marketing 101 - What is it even?

Affiliate marketing has seen tremendous growth over the last few years. While it might sometimes feel like something that is a bit outdated, it remains not just relevant, but lucrative.

According to Business Insider, affiliate marketing programmes have been growing by around 10% annually - a trend predicted to continue until at least 2021.

affiliate marketing growth over the years

In fact, a study by Web Market Support found that 81% of marketers and 84% of publishers leverage the power of affiliate marketing.

With the ecommerce boom that’s likely to come from the global pandemic that forced many businesses to adopt online channels, affiliate marketing is one of the sharpest tools in your digital marketing arsenal.

But what is affiliate marketing even? Who does it benefit? How do you set it up and why is it such a big deal?

So many questions, so much time thanks to everyone working from home and not wasting their time in traffic.

What is affiliate marketing actually?

As you might deduce from the word itself, affiliate marketing is when a third party agrees to market your product or service for a portion or percentage of each sale they make through their efforts.

But differently, affiliate marketing is a shrewd form of online advertising that rewards the affiliate for driving traffic to the advertiser or for other transactions.

Think of it as sales commission in the internet world.

It is a wonderfully symbiotic relationship that benefits not just your brand and bottom line, but the affiliate, too. Many affiliate marketers earn a full-time or part-time income by promoting other people’s stuff. Pretty useful, right?

The biggest affiliate marketing products

Often referred to as “niches”, there are some markets where the affiliate approach will flourish.

Unsurprisingly, retail makes up the biggest sector of affiliates, but according to a case study by AM Navigator, more specifically, the fashion niche is the most popular. Remember, though, that this does not necessarily mean that it will translate into the most sales. It simply means that this is the niche in which the most affiliates are active.

The travel niche will most likely see a steady decline in its market share in the wake of the global pandemic and uncertainty around travel.

The chart below shows a further breakdown of the niches where affiliate marketing thrives.

affiliate marketing biggest niches

Why you have nothing to lose through affiliate marketing

If you think it sounds too good to be true, it is not. While you might not be able to build yourself a Scrooge vault overnight with all the extra sales, there is no risk attached to starting an affiliate marketing campaign.


Pay only once a sale is made

Remember, you do not pay any marketing or advertising costs until a sale is made. By trusting that your affiliates will bring in sales, you hold onto your much-needed cash until each sale is processed. Most affiliate programmes often payout on a monthly basis, giving you a little bit more leverage on your capital.


The sales potential is endless

Time to do a few basic sums. If one affiliate is bringing in an average of five sales each month, then five affiliates could potentially be giving you 25 sales each month. Imagine what happens if you can get your affiliates up to 100 or more?

Others do the hard work so that you reach more customers

By leveraging affiliates in your marketing strategy, you can free up some time additional time and expose your brand to untapped markets.

With an increasing number of consumers shopping globally, there is – quite literally – a whole world of potential customers out there.


Affiliates may focus on specific market niches in their efforts, such as book clubs, video game player associations, auto clubs, and the list goes on  - whatever your brand or business, there is a niche market with customers for you.

Closing time

Time for you to go out go out into the world. Are you singing along? Perhaps the greatest benefit to an affiliate marketing campaign is that you will stay open around the clock.

If you have already established an ecommerce presence you might shrug and think that you have got this waxed already.

But remember what we said about consumers being global shoppers these days? Imagine a shopper at the other side of the world visits your online shop and  there is a glitch on your site, meaning they cannot access your product.

Unless you have a global empire with a support agent in every time zone, customers are unlikely to sit around and wait for support to get back to them.

If your product is littered around the web through affiliates all around the world, there is a chance that you might still make that sale – even if you have to pay out a bit of commission for it.

Are there any downsides to affiliate marketing?

Sure, nothing is perfect.

Some affiliates may not bring in any sales or lose interest in your product when the next best thing comes around.

You can mitigate this risk by screening your potential affiliates and choosing them more carefully. Make sure their website is established (and check out their social media accounts while you’re at it).

You can also offer much better commission rates for affiliates who perform really well. Once you have established a working relationship with affiliates, you may consider increasing commission rates. While this might result in a lower profit per sale, for the affiliates who do this full-time, it will be a driving force to increase the number of sales they bring in.

The technical challenges

If it sounds like a daunting technical process to get started with affiliate marketing, do not fret. Affiliate marketing is so popular these days that it is integrated into most ecommerce platforms for both affiliate marketers themselves and businesses looking to establish campaigns.  

Letting go of some control

There are rules about affiliate marketers having to disclose when they include links that earn them a commission, but these are usually found in the fine print.

If you are a bit of a control freak, you might need to learn to let go a little bit. You won’t be able to dictate every single site your product is associated with – especially if you opt to run an open-to-all affiliate programme.

Monitoring affiliates regularly and booting out those who are not being the yin to your yan should help ease some of those control-freak tendencies.


We may earn an affiliate commission through some of the links in our blog posts.

We may earn an affiliate commission through some of the links on our site.