What is Affiliate Marketing and How it works

What Is Affiliate Marketing and How it Works – Step by Step Guide for Beginners 2021

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What is Affiliate Marketing and how it works? I have seen this question pop up every time on the internet. On Quora and Reddit you will find related questions about Affiliate Marketing.


I have written an Affiliate Marketing Case Study and show the steps that more successfully affiliates used and platforms to join to succeed online.

What you have to know is Affiliate Marketing is a Billionaire Industrial and if you want a piece of share it will require time, effort and termination.

If you are someone who needs instant result or desperately need money this business model is not for you.

But if you are willing to implement strategies and think out of the box and you need to escape the rat of the 9 to 5 job by all means and live the laptop lifestyle Affiliate Marketing is what you need.

In this Affiliate Marketing Guide I will cover:

  • What is Affiliate Marketing and how it works
  • How to Start Affiliate Marketing business as beginning
  • Is Affiliate Marketing worth it?
  • Affiliate Marketing steps that lead to success
  • Affiliate Marketing FAQ

So without further ado, let’s get started.

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What’s Affiliate Marketing?

According to Wikipedia

\”Affiliate Marketing is a type of performance-based marketing in which a business rewards one or more affiliates for each visitor or customer brought by the affiliate’s own marketing efforts\”.

The term “Marketing” can freak someone out especially Engineers and IT technicians. I define Affiliate Marketing as a process of recommending people products and services and make commissions when sales occur.

Well, we recommend people products and services daily even if your friends want to order pizzas you can recommend them the best pizza in town.

This is a word of mouth is also called Traditional Marketing and with this method, you can only reach few people.

Nowadays everyone has access to the internet and we can reach many people and communicate with people from around the world.

Many merchants have introduced Affiliate Programs as a way to push their products and services in front of their potential clients by allowing other people to sign up for their Affiliate Programs.

If you implement good strategies as an Affiliate you can make decent money and people are making 5 to 6 figure passive income with Affiliate Marketing.

I will talk more about the process to establish a successful Affiliate Marketing business and the platform to join to start learning how to earn uncapped commission online.

How does Affiliate Marketing work?

Before I explain how affiliate marketing works. Let look back to 1989 when William J. Tobin the owner of PC Flowers & Gifts launched Affiliate Program in Prodigy Network.

By 1993 PC Flower & Gifts generated a revenue of $6 million per year.

To increase revenue many companies have adopted the Affiliate Program where anyone can sign up in their Affiliate Program.

It becomes common for some companies they do not want to spend money on marketing and rely on their affiliates.

Instead of throwing money on campaigns, they prefer to share a certain percentage with their affiliates. Most Affiliate Programs that you can sign up with pays 10% to 50% in commission.

Amazon has the lowest commission you can earn up to 10% and Clickbank you can find products that pay up to 85%.

Once you have signed up as an Affiliate to promote merchant products then you need to learn how to drive traffic (visitor) to the merchant sale page.

This is the skill most affiliates as been lacking. Fortunately, Wealthy Affiliate has free step by step training that teaches how to drive organic traffic.

Remember traffic represent people. If you do not have the traffic you do not have a business. Think about traffic like people who are coming to your store.

Affiliate Marketing Process


Let me explain how it works. As an Affiliate, you will be given a unique Affiliate Link by a merchant that link can redirect your potential clients to the merchant sale page.

The Affiliate Link is more like your ID when the merchant can track all your sales and how many people visit the sale page through that link.

As you can see on the screenshot below.


I generated 132 clicks which mean 132 people visited the sale page through my Affiliate Link and only 2 sign-ups for a free trial and one purchase the program I am promoting. In your job as an affiliate, you need to generate leads for your merchant.

How can you do that?

You will need to have a website or youtube channel and start creating content to reach your audience and add value to people.

If you are reading this Affiliate Marketing Guide it means I am adding value by explaining what is affiliate Marking and how it works.

Other Affiliates use Facebook, Linkedin, Twitter, Instagram and other Social Networks to reach their audience. At this stage as a beginner, I will recommend having a website or youtube channel.

This will involve ranking your content on search engines like google and your video on Youtube through SEO ( Search Engine Optimization).

This is the process of generating organic traffic (free traffic).

When your potential clients are looking for products to buy they will go on google or other search engines and type any keywords.

For example, Best Tea to Lose Belly Fat.


Google Search Results will show them different results according to your keyword and if your website is optimized for that keyword they will land on your page.


I am sure you understand the idea behind it and they are 4.72 billion people who use the internet. If you can manage to reach them you can make 5 to 6 figure passive income per month.

It is very possible with affiliate marketing.

Summary of How Affiliate Marketing Works.

Affiliate Marketing as 3 main players:

  1. Merchant

Merchants can be companies that selling specific products or software developers or retailers who need more sell without spending money on marketing.

Then they can launch an Affiliate Program and pay up to 50% commission per sale.

  1. Affiliate

Affiliate is you and I who want to make some cash full-time or part-time. You can sign up for any Affiliate Programs and drive customers to the merchant sale page with a unique Affiliate Link and earn commissions when sales occur.

Most Affiliates are bloggers or Youtubers. This is the best way to reach your audience.

Some Affiliates use Facebook, Twitter and other Social Networks to generate pay traffic and collect leads. This traffic is costly and can affect your ROI (Return On Investment) if you are a beginner.

  1. Customer

Customers are people who are interested in buying products. They start looking for information on the internet and land on your website or youtube.

They trust the information that you have been given on your website or youtube.

Somehow you influence them to decide with your content and they click Affiliate Link that redirects to the merchant sale page and buys the product.

It sounds very simple but there is more to it and you can sign up for a 7-day email course and show you everything you need to kick with your affiliate marketing business.

Is affiliate marketing worth it?

As I said earlier in this Affiliate Marketing Guide this business is a Billionaire Industrial in a recent article Statista.com shows the affiliate marketing spending in the United States will reach 8.2 billion.

There is no better time to start your Affiliate Marketing business now and COVID 19 has accelerated the process everyone is shopping online.

Affiliate Marketing is worth it but you will need to learn few steps to successfully succeed in this business model. There are many reasons why people went to start affiliate marketing.

  1. Flexibility

We live in the world where most people are unhappy with their job and others are tired of the slavery of the 9 to 5 job.

People need to have a flexible job no need to worry about waking up in the morning and stuck in traffic. With Affiliate Marketing you do not need to wake up in the morning you work on your on time and you become your own boss and you can work from anywhere in the world.

  1. Passive income

Warren Buffet said “ If you do not find a way to make money while you are sleeping you will work until you die” This is what motivates people to start an Affiliate Marketing business you can make money while you are sleeping.

Is that possible?

Hell yeah! The internet makes it possible and they are a lot of people who make passive income with Affiliate Marketing.

You can even build your business on autopilot. You can check out My Top Recommendation platform to quick start your online foundation.

  1. Work Remotely

With Affiliate Marketing you can work from anywhere in the world as long as you have your laptop and internet connection.

If you like travelling you can do that while you earning money with your laptop. You can work remotely any time and anywhere.

  1. Low Risk

Since you can sign up for free for any Affiliate Programs and start promoting products they are not risk involve.

You can also learn how to generate organic traffic through SEO.

Affiliate Marketing is risk-free and there is no start-up cost unless you want to invest in learning some skills that will help you to generate more sales or invest in other tools to automate your business.

When I mean about tools I am not talking about all done for you software like Crypto Bank and 12 Minutes Affiliate.

I am talking about autoresponders like Aweber and get responses.

How to start affiliate marketing

To start an Affiliate Marketing business is too easy you can start without any start-up cost. But the hardest part is to succeed in this business model.

Affiliate Marketing need a lot of time and effort. If you sign up just to make quick bucks then when you realize this need work and time you will quick along the way.

If you can put in the work you can make passive income just with your laptop and internet connection.

Below are the steps to start your Affiliate Marketing business.

  1. Finding your niche and audience

You might be confused about the term “NICHE”  let define what is a niche. According to Wikipedia, “a niche is the subset of the market on which a specific product is focused.

The market niche defines the product features aimed at satisfying specific market needs, as well as the price range, production quality and the demographics that it is intended to target.

It is also a small market segment. Sometimes, a product or service can be entirely designed to satisfy a niche market” You need to find a niche that you need to focus on.

I always recommend people to choose something that you have patience with. Do not follow the money follow your passion.

If you like what you do then it will be easy for you to put in more work and you are set for success.

  1. Finding Platform

Once you have found your niche then you need to find a platform to research your audience. This is the foundation of your business.

Many Affiliates as a different approach in choosing a platform to research the audience. For me, I recommend starting a blog page and youtube channel.

I know what you think. Hell! Making Videos.

If you want to make money you need to come out of your comfort zone and go hustle. If you do not like making videos then you need to write content on your blog page that can be found on Google or other search engines.

This involves learning about SEO ( Search Engine Optimization). If you choose other platforms like Facebook, Twitter, Instagram and Linkedin.

You will need to paid to reach your audience and it will cost you a lot of money with SEO you can reach millions of people for free but it needs some works.

  1. Finding products

As an affiliate, you need to connect with your audience and provide them with solutions. This involves finding the right products for your audience.

Promoting products with low quality can also affect you and dimmish your reputation. You can find products to promote on Affiliate Network Below:

  • ClickBank
  • Amazon Associate
  • JVzoo
  • WarrioPlus
  • Affiliate Future
  • ShareASale

They are plenty of Affiliate Networks that you can sign up and choose products to promote and I will recommend choosing 3 to 5 products.

So you can focus on the more product you promote you decide to promote the more traffic you need.

  1. Make commission

As Affiliate your revenue comes to commission and I will recommend you to choose products that are paying recurring commission this means you can earn commissions for a lifetime.

The commission range from 10% to 50%. Every time you make a sale you will get paid a commission some company pay every month and other after 2 weeks.

Some will pay you through direct deposit other through PayPal or Payoneer.

How much can I make with Affiliate Marketing?

I do not like answering this question. For me, it is the wrong question it shows your focus is on money. If you do not make that money in 1 to 6 months and then what?

You will quit, right?

Quit is the only failure that an affiliate can experience.

Before I answer the question.

First, you need to think about how many people you can help. You also need to enjoy helping people the more people you help the more money you can make.

You also need to put an action plan to reach your audience.

I am sure you have seen videos or ads people saying they make $100 per day and up to $3000 per day.

This is very possible but you need to work on building your online foundation you can not make such money within a month or two of starting your business.

Affiliate Marketing is a long term investment that needs time and a lot of effort. You cannot plough, sow and harvest and eat on the same day.

It is impossible.

\"SupperGrace ( Little Mama) made $1400 in one day you can check out her report: Oh My! $1400+ In One Day!

Affiliate Marketing Is Amazing! with this business model you can go from 0 to 6 figures per month.

Heck! I am not promoting a get rich quick scheme or overnight success.

As you read throughout this Affiliate Marketing Guide I am always emphasized time, effort and termination.

Affiliate Marketing Pros and Cons

In every business whether is online or offline, there is always the advantage and disadvantage. Let out out few of the Affiliate Marketing Pros and Cons.


  • Billion-dollar Business
  • Low-Cost Business Idea
  • No Expertise Needed
  • Low Investment Costs
  • Secondary Source of Income
  • Convenience and Flexibility
  • Passive Income – Earn Money While You Sleep
  • Be Your Own Noss


  • Commission Based Payment
  • You Don’t Control Your Competition
  • High Competition
  • Freelance Jobs are not for Everyone
  • Uncertainty

My Affiliate Marketing Guide – Final Verdict

Affiliate Marketing is the best business model if you are thinking of making passive income from anywhere in the world.

When I will also say Affiliate Marketing is not for everyone I have seen people starting this business and quit within 3 to 6 months.

This is not a fixed quit financial situation and it is not an overnight success too.

If you want to jump in this journey you will need to commit to long-term success and if proper strategies are implemented the sky is online the limit.

People are making 5 to 6 figures per month.

You can check out My Top Recommendation platform, learn how this business model works, and get all tools to establish a successful business online.


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