What Is Affiliate Marketing? The Basics In Less Than 5 Minutes

Estimated reading time: 4' 49''.

“Affiliate Marketing is the art of doing a merchant’s marketing better than they can and profiting from it.”

- Chris Sanderson

Affiliate Marketing is one of the best tools available to online merchants to reach new customers. It is performance-based marketing, where two main participants are involved:

  • The Merchant (also called the “Advertiser”), who has the product or service.

  • The Affiliate (also called the “Publisher” or “Partner”), who markets the product.

Affiliate Marketing Basics | Merchant and Affiliate | Feedeo

Affiliates are independent marketers who promote products and services and get remunerated for each sale, lead or visit they send to the merchant, depending on their payment arrangement. At the end of this post, you will find a glossary with further details.

Some affiliates make these programs their main sources of income. Therefore, they are highly specialised and skilled, and they know how to sell products even better than merchants themselves.

Would affiliate marketing work for my business?

Regardless of your type of business, the short answer would probably be “yes”. Since merchants compensate affiliates only based on confirmed sales (except when the agreement is to pay them per clicks or leads), it is a situation where the merchant simply can’t lose, and both parties win.

One frequently asked question is what kind of products and services are suitable for being sold through affiliates. Most partners prefer to advertise the products of retail online stores with big catalogues, but that does not mean online businesses with just one product or service are unsellable, not at all. Even exclusive and rare products can be sold by the right affiliates.

To overcome doubts about affiliate programs, query Google or any other search engine using “[your product/service/industry here] affiliate program”. This will provide relevant information about your competition, as well as ideas for your own marketing plans.
As a last resort, consider hiring a specialised consultant to advise you if you still feel hesitant.

How do I get started?

To start an affiliate program, you can choose to join an affiliate network or try an in-house solution.

Affiliate Marketing Basics | Difference Network vs. In-House Solutions | Feedeo

Affiliate networks are mediators who connect publishers and merchants. They provide convenient tools to both, including tracking and reporting tools, and payment aggregation. Publishers use them to find interesting affiliate programs, with products suitable for sale from their website.

What's the best option? It will depend on many factors. You should experiment and test what works best for your product. If you can, do both. Affiliate networks are a good way to start since they will provide you with tools and instructions to make the process easier and reach publishers. But make sure to create your own in-house system to establish a closer relation with your key publishers, the ones driving more traffic and sales to your site.

How does it work?

All clicks on publishers’ campaigns leading to your website will be tracked by the platform or software you are using.
Then, conversions -that is, purchases, subscriptions, or whichever your goal may be-, will be tracked on your own page, thanks to a string of code also known as “tracking pixel”.

Tracking pixels work thanks to cookies. These let you know where a buyer is coming from, and therefore which of your affiliates got you each conversion.

Most of the Internet users allow cookies, and it’s the most common way to track conversions. But if you like, there are other methods available. Tracking can be tied to the URL, to the client’s IP, or to the shopping cart, for example.

Affiliate Marketing through Rakuten and Feedeo

Affiliate Marketing Basics | How to- via Rakuten and Feedeo

Rakuten is one of the most popular networks among merchants and affiliates, a great starting point to start using affiliate marketing and sprinkle your products all over the web. You can activate it by just flipping a switch from Feedeo.

Sending your products to Rakuten from our system works just like with any other sales channel, like Google Merchant Center, for instance. Feedeo provides Rakuten with required information about the products you wish to market. This data will be used, first of all, so that publishers can find your products when they enter Rakuten searching for interesting material to advertise on their websites; and second, so Rakuten can generate the code publishers need in order to do so.

You can specify which products you want to market using this system. We recommend you to start with a small selection of some of your highest quality products, the ones you think will be more attractive and perform better.

Glossary. Terms you’ll need to know:

Pay-Per-Lead (PPL); Pay-Per-Sale (PPS); Pay-Per-Click (PPC): These are the most common payment arrangements in affiliate marketing. Each name indicates what’s the merchant’s goal, in other words, what the advertiser will be compensated for.

Other names for Affiliate Marketing: Performance-based marketing, associate programs, partnership programs, bounty programs, commission programs, and revenue-sharing programs.

Cookie life: Cookies are strings of code that allow you to keep track of the affiliates who are getting you conversions. The cookie life determines how long that information will be tied to a customer.

  • Example: Let’s say, a customer clicks on a banner on the publisher’s page, finds your product, but decides to give it some thought before purchasing it. If the cookie life is set at 3 days, and the buyer makes the purchase on the 4th day after clicking the ad, the publisher won’t be compensated for that sale.

If there is anything else you would like to know about affiliate marketing you can leave a comment, or contact us via our support page, Facebook, or Twitter.
Looking forward to hearing from you!

Your e-mail address is required.

Your e-mail address is invalid.