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Step-by-Step Tutorial on Building an Affiliate Marketing Business

Affiliate marketing is quite an inexpensive and easy way to start building your online business because you don’t have to create products to sell.

Making even a big fortune with almost zero investment is possible. By using affiliate marketing some people achieved total freedom, and as a result, they're traveling around the world. Unfortunately, so many people fail in this business because they don't know the right methods and don't have the necessary skills.

In this guide, I'll tell you everything you need to know to be able to get started and make a huge profit. You'll learn how to benefit from it for years and make a stable passive income.

What is affiliate marketing?

It basically means that you promote other people's products and get a commission when somebody makes a purchase. In other words, you sell products through the internet for a commission.

It's one of the most popular business models nowadays that can be incredibly lucrative and has lots of advantages. All you need to do is to send traffic to someone else’s product through your affiliate link.

what is affiliate marketing

Of course, constantly tweaking and improving the system you're using is highly recommended.

There are a wide variety of methods and techniques that can be applied to make the system more effective.

Furthermore, you can learn from the advice and mistakes of others and in some cases even use templates. Later, you might even outsource the whole marketing process!

2 tier affiliate programs

A 2 tier affiliate system allows you to make commission not only on your own sales but the sales from your customers, too.

This way, you will be motivated to train your customers on how to get started and how to get new clients.

You will earn money both from your clients and from their clients as well.

Second tier affiliates are also called sub-affiliates. One of the most famous companies who offers a 2 tier system is WPengine.

Advantages and disadvantages

If you want to try out this business model, it's essential to know how it is different from other possibilities. If you're also interested in other business models besides affiliate marketing, then please check out this lecture.

Now let's see the benefits of running an affiliate marketing business:

  • no need to create any products
  • no need to provide customer service
  • low entry fee
  • it can bring you a passive and recurring income
  • no need for any qualifications 
  • minimal risk
  • high commission

As you may already know, creating products takes a lot of time and effort. By engaging in this business, you don’t need to create any products as it allows you to make money using someone else's products.

You don't even have to deal with customers at all or provide any customer service and you are not responsible for the products since these are taken care of by the company who created the affiliate offers.

If you’re just getting started, it's a good way to get into the online business world without having to invest a lot of time and money.

Apart from web hosting, email marketing and some other stuff, it doesn't require financial investments.

​Additionally, no qualification is needed whatsoever to be an affiliate marketer however, a strong online marketing knowledge is a huge advantage. If you fail to sell the product you started promoting, you lose nothing. You simply move forward and keep trying with different products until you find the one you'll profit from the most.

​This method however could be time-consuming so I suggest you pick a product that's already selling well and that’s getting positive reviews. Find people who are already making a good profit from a product and choose the same one. This way you basically validate the demand before deciding to sell.

The best thing is, promoting subscription-based services allows you to make a passive and recurring income every month.

There is no limit to how much you can earn with affiliate programs, it all depends on how good the product is that you are promoting and how much time and effort you invest in it.

Now let's go through the disadvantages:

  • not a 100% profit
  • ​no control over the product
  • ​dependence on the company
  • competition is fierce

One downside is that you won't keep 100% of the profits you generate. The commission you get for digital products is usually quite high.

For example, in some cases, you get between 50% and 80% which is much more than the profit of the product creator.

Another downside is that you have no control over the offer. Prices of the products can change anytime and you have no access to the checkout process either. If the quality of the product changes, you can't do anything about it. If the company goes bankrupt, you lose your business.

That's why I suggest the following:

If you're serious about affiliate marketing, you don't want to depend on only one company. Therefore, you should aim for multiple sources of income. It means once you built up a solid affiliate business at a company, join other ones and after some time, create your own products.

multiple sources of_income

Let's say you choose to sell a popular product. There is a considerable chance that many other affiliate marketers are promoting it at the same time. Due to the intense competition, you need to find a way to differentiate yourself so that people buy through you rather than others.

Why most people give up

As I said earlier, this kind of business can easily be started with very little upfront investment, yet most people fail after some time. Guess why.

Lack of skills

The major reason is that they don't invest time to master all the skills required to be successful in this line of business. Just like any other online businesses, a goal-oriented mindset is essential to success.

Building the foundation of web design and digital marketing skills are also necessary because you want to promote your business on a website through the internet, right?

For newcomers, all this information might be a bit overwhelming but that's exactly why I created this comprehensive guide that includes many useful lectures.

Please note that every required skill can be acquired step by step. Most people jump from one technique to the next without mastering anything. Due to lack of focus, their efforts fail and after realizing it's not working they just give up.

“Over promise and under deliver” approach

Another useful tip to remember that many marketers do is the "over promise and under deliver" approach. I'm sure you stumbled upon sales pages promising that you'll make thousands of dollars in a few weeks, even if you're a total newbie. When you bought that product, the outcome was never realized and as a customer you felt disappointed. Marketers that apply these strategies don't care about their customers. They just want the money.

As a result, they lose trust and credibility.

This is not the right way to become a trusted source and gain recurring customers. The right approach is to focus on your clients and help them solve their problems.

promise and deliver

No value

A common issue that I see a lot is that affiliates want instant success and money without taking real action.

They start to promote their affiliate link on every social media platform without giving value, which is quite an inefficient way. It's called spamming.

Most people who do this kind of stuff earn next to nothing from this kind of marketing.

What people should understand is that only when applying a long-term mindset will you become successful and profitable by showcasing your expertise and by creating quality content that gives value. The whole idea is based on building quality relationships with people.

How affiliate marketing works

Now it's time to look at how affiliate marketing works.

The first thing you need to do is to find a product to sell and sign up as an affiliate to get a unique affiliate link to promote. Obviously, a website and quality content are necessary but we'll get back to this later.

Basically, you identify a problem first, then solve it by including an affiliate link to where that person can purchase the solution.

steps to start affiliate marketing business

Cookies

The whole process relies on cookies. Cookies are small files that are saved on the web browsers to identify website visitors at a later point or to retrieve information about them. ​They also allow you to keep logged in sites that require a username and password.

​In case of affiliate marketing, cookies are used to identify the person who refers you.

By adding your unique affiliate ID to a product URL, you'll have your own affiliate link by which companies can track that the sales are coming from you.

If somebody clicks on your affiliate link, a cookie will be saved on his or her computer which will be retained for days or months depending on the cookie's lifetime period.

For example, if a cookie is set to 60 days, you still get a commission when somebody buys the product 59 days after clicking on your unique link. If that person buys the product after this period, a commission will not be assigned to you because the cookie has already expired.

A good affiliate program will also give you the buyer's name and email address so that you can follow up with them. This information is essential if you want to build a real business.

I highly recommend you to choose an affiliate program which doesn't hide this information. This way, you will be able to build trust and support your downline. What's more, you can even work together.

Some advanced affiliate programs offer promotional tools and training to help you get started. So don't ignore this benefit, either.

Commission

Commission is usually paid weekly or monthly depending on the company you signed up for.

Commission rate can be anything between 3% and a 100% depending on what product you are promoting. You usually get much more commission for digital products because they can be replicated without any cost. On the other hand, for physical products, you can expect to get only between 5% and 10%.

affiliate marketing process

Strategies to earn recurring and passive income

Quality product

The key to being successful in an online business is to build relationships with people.

In case of affiliate marketing, the only way to do this is to promote quality products and be honest.

quality

You also need to use and like those products. If you really like a product, it'll show in the content you create, either blog posts or videos. People can easily tell if you know what you're talking about.

On the contrary, you'll lose your reputation and credibility if you recommend crappy products.

Be honest

Always give your honest opinion about the product, both advantages and disadvantages.

Thereby, by providing real value, you automatically build trust. When you have established trust, your conversions will skyrocket!

You want to give your audience useful information that they can then use to make a decision.

Offer them help, answer their questions and you will be rewarded. Let them know that you are there for them.

Recurring income

Choosing a solid product is also essential to make sure it will convert even years after. Therefore, I highly recommend you to consider what niche you get into.

Additionally, the best thing is if it offers recurring commission. This way, you have to win your clients only once, and you get money every month as long as your clients keep their accounts. These are usually subscription-based services. Let's see some examples:

  • ​software subscription (email marketing)
  • ​content subscription (online courses)
  • ​hosting (Godaddy)
  • different memberships sites and so on…

Of course, before marketing any of them, always validate the demand and determine how stable it is.

Combining affiliate marketing with subscription-based services is the best way to develop strong relationships with your clients. Running this kind of affiliate business model is not necessary but it is a huge advantage.

service income

Promoting one-time fee products can also be profitable as long as you continue to turn visitors into customers.

To sum it up, by promoting solid products in an evergreen niche, there is a big chance you'll be able to achieve passive income after some time. From that point on, it requires minimal time to keep your income consistent and at the same time, it offers you the freedom you always wanted. Sounds awesome, right?

Key things to consider before promoting a product

There are several considerations you need to think about before choosing a product. I will show you what to look for that will help you determine whether a product is worth promoting or not.

Evergreen niches

First, it's essential to choose the right niche you want to get into.

Now let's see the most profitable evergreen niches that will offer you long-term income:

  • ​health and fitness
  • ​weight loss
  • ​gaming
  • making money online
  • entrepreneurship
  • dating

Products proven to work

With affiliate marketing, many marketers became rich selling specific products. What they're selling is already proven to work and is straightforward.

You also have the option to promote those same products. Of course, you can pick up similar or different products. The point is to find the best selling examples.

Additionally, you should ask yourself whether you think it has a good potential for sales. In other words:

Would you buy it?

​What problem would it solve for your audience?

what does your product do

Your excitement

It's always a good idea to pick something that you care about and you're excited for.

You'll be much more successful selling something that you genuinely believe in. On the other hand, if you feel you cannot truly associate yourself with the product you are trying to sell, then your sales pitch will suffer.

Target market

In one of my other lectures, we looked at how important it is to determine who your target audience is. These are the people you want to sell your product to.

You want to know who they are, what they are like, their buying behaviors and most importantly, where you can find them.

Of course, it also involves some research. That means checking the existing products on the market, some websites in that niche, signing up for e-mail lists and reading the statistics.

market analysis

Besides these, you should also look at other sellers who are already doing well.

Looking for reviews

Additionally, it's essential to do some digging to find out what kind of reviews people left about the product.

If you find lots of negative reviews, then it's probably the wrong choice. Look for them on forums, groups and communities as well.

feedback

Commission rate

Another thing to consider is the commission and the potential profit you could earn from the product.

As I previously mentioned, commission is usually significantly lower for physical products due to the manufacturing costs. That's why digital products are so appealing, especially when you're selling services.

This way you could run a paid advertising campaign and still get profit from it.

For one-time fee products, you want to consider which ones you can sell for more and which ones offer higher commission. Additionally, it's important to think about the volume you're likely to sell. For example, a $29 product might sell more easily than a $97 product but you obviously need to sell less volume from the latter one to reach your target.

Average customer lifetime and retention rate

In regards to subscription-based services, it's also worth determining the average customer lifetime and retention rate. To put it simply, you need to know how long for a customer will remain at the company.

(source: https://www.astutesolutions.com/blog/articles/what-are-the-stages-of-the-customer-lifecycle)

Similarly, retention rate shows what percentage of the customers continued their subscription in the next year. So in this case, you might want to think about how much profit you are likely to get in the long term.

Unique selling proposition

Before choosing a product to promote, determining its unique selling proposition should be a crucial step.

It's important to know what makes it different from other alternatives and why people should buy it from you. Ask yourself these questions:

How is my product different from the alternatives out there?

Why would my customer buy this product?

​Why is it better?

When selling a product, try to present this unique value in your content.

unique selling proposition

In case, it doesn't have any, it might be the wrong choice to promote it. Alternatively,  you could add some uniqueness to the product no one else is offering. For instance:

  • ​some bonuses
  • ​support
  • ​coaching
  • community access

Done-for-you content and training

I've already mentioned this benefit. Some companies are willing to give away extra content as part of their affiliate program to help you sell their products.

This added value should usually be very beneficial but sometimes it's not.

Always check beforehand if it's really high-quality content or not. The extra material they give you can be a lot of different things:

  • ​done-for-you landing pages
  • ​sales copy
  • ​design elements
  • banners
  • posts
  • email swipes
  • training

It's a good sign if they provide quality marketing materials.

Top affiliate networks

One method to find products to promote is through affiliate networks.

Affiliate networks are basically big marketplaces and central databases which have thousands of products to choose in every niche. They give you access to popular products and allow you to manage your sales and income.

By automating the entire process you don't have to communicate directly with the seller.

You have many options if you want to choose an affiliate network. Let's see the most popular ones:

  • JVZoo
  • Clickbank
  • Warriorplus
  • Shareasale
  • Rakuten
  • Amazon

In my opinion, JVZoo, Clickbank and Warriorplus are the best choices for beginners.

jvzoo
ClickBank

Visit these sites, spend some time and browse some offers to find the right ones. The best thing is that these networks allow you to see different statistics regarding each product:

  • ​number of sales
  • commission
  • ​conversion rates
  • refund rates
  • visitor value
  • when it was launched, etc.

This way, you can quickly determine which one is worth promoting.

You want to choose something with a high conversion rate, high commission and a low refund rate. Furthermore, it's also a good sign if it's been around for a while.

There are also many other affiliate networks for those who can't find what they're looking for.

Get approval the right way

To be able to start promoting a product with an affiliate network, you'll need to be approved first.

When applying for it, take the time to let the product creator know how you want to promote the product and your chances of getting approved will be much higher. It's very important, especially if you don’t have any prior sales as an affiliate.

Product creators want to make sure you don't use spammy or unethical methods for marketing as this could damage their conversion rates.

Tell them if you have an email list, a Youtube channel, a blog and what strategies you'll intend to use. In other words, explain to them how serious you're about marketing their products.

How to find products online

Besides affiliate networks, many online companies who sell products online, usually offer an affiliate program you can sign up to and start promoting their products.

Visit their websites, and you will find that a lot of them offer an affiliate program listed on the top or bottom menu. So look for the best programs for your niche, consider tools you use yourself and see if they have an affiliate program you can join.

Example:

SE Ranking affiliate

You can also simply search for them in Google. Just type "product name + affiliate" or "your niche + affiliate" into the search bar and go through the search results.

Example:

serpstat affiliate - Google Search

Promote your products on a blog

By creating high-quality content, you build authority and it makes you a trusted expert in your niche. Thereby, when you recommend a product, your followers will be more likely to listen to you and to buy the product you suggest.

Content marketing works so well with having a landing page and in fact, often its goal will be to direct people to your landing.

First, you need a blog where you publish in-depth posts and give value to your audience. Simultaneously, to extend your reach, combine it with a Youtube channel and a strong social media presence where you can further promote your business.

Don't forget your content should be engaging, provide real value and stand out from the crowd. Longer content which is at least 1500-2000 words always tends to get more engagement and shares.

In my other lectures, I talked about the importance of great design, logo creation, personal branding, and much more, so keep these in mind.

blog plan

With regard to affiliate marketing, there are several different types of content you might create:

  • product comparisons
  • ​product reviews
  • how you use "product x"
  • in-depth tutorials
  • "how to" posts
  • sharing your expertise on something
  • ultimate guides
  • video tutorials, etc.

Post on social media sites

Creating a strong online presence on different social media platforms is a crucial step to get free traffic to your website.

Even if you own the best blog in the world, you won't get visitors to your site if you don't market it first.

social media marketing for business

As long as the content is valuable and the titles are enticing, posting regularly on those social sites is a great way to build up a large following.

You might also try forums and question and answer sites like Reddit and Quora. By doing it correctly you can gain a massive amount of shares and website views.

SEO

At the same time, you should also enhance your website's visibility with SEO. That's an organic method to market your business.

Today the only way to rank high on the search engines is to update your site regularly with high-quality content and to use natural language. Spending money in order to trick search engines does not work anymore.

Focus on building a quality user experience instead.

As content marketing and SEO work together, you should always optimize your posts to be search engine friendly.

seo

Producing topic-relevant in-depth articles will encourage people to share your content and link to them. And this is the natural way of inbound link building.

Keep in mind that SEO strategy is a long-term plan which doesn't give you results from the beginning but it's completely free. You only need to give up your time if you do it yourself. If you want immediate results, paid advertising is the fastest way to achieve that.

Create Youtube videos

As an affiliate marketer, building up your subscriber base on Youtube with useful tutorials, "how to" videos, software walkthroughs and product comparisons is at least ​as equally effective as it is on your own website.

What's more, you don't have to create new content for your videos.

Repurposing your existing written content into videos is a faster way than creating a new one. When doing product reviews, always be authentic by presenting the pros and cons and expressing your honest opinion. You don't just want to say "I love it, it's awesome."

Show your viewers the benefits and how they can get the most out of it.

video marketing

So how do you make these videos? You don't have to have professional equipment to do that. You'll just need a phone or webcam. For software tutorials, you'll only need a screen recording software.

Email marketing

It's a good idea to use email marketing as a supplement to content marketing.

The whole idea behind it is to get the email address of your prospects so that you can build relationships with them by sending additional valuable content and at the same time, promoting affiliate products.

The first step in email marketing is to build an audience with a lead magnet. A lead magnet can be lots of different things:

  • ​mini video courses
  • ebooks
  • ​templates
  • checklists
  • coupons, etc.

When offering valuable content, you should always communicate why your prospects should listen to you and enter their e-mail address.

lead magnet

You can add opt-in forms into your blog posts, either on the sidebar or on the homepage, where your visitors can sign up. Likewise, an opt-in page can be built to generate leads for your business.

Remember, the goal is to build trust and provide value first, not to try and sell a product. Instead, use an email sequence and once trust is established, then move on to talking about your deal and then eventually provide the link.

Giving away an ebook

A very creative way of doing affiliate marketing is to give away ebooks filled with affiliate links.

​The ebook should have quality content with a nice design and adequate formatting, which provides real value to your audience. Then you should of course incorporate your affiliate links into the content in order to get a commission every time people buy through them.

Finally, apply different marketing strategies to promote the ebook.

Of course, an ebook can also be an entry point for your sales funnel.

giving away ebook

Powered by “your product name”

This strategy involves you adding the phrase Powered by "your product" to every product you use and making it clickable with your affiliate link.

It's so simple and completely passive because you don't have to do any extra work to make it work. It doesn't matter what you're promoting, this strategy can be implemented to most products after some customization.

To illustrate this, let's see some examples:

You're using LeadPages as your landing page builder and you add Powered by Leadpages at the bottom of every page.

When sending out emails with your autoresponder, you include a similar clickable affiliate link to your email signature.

​You decided to incorporate premium live chat features into your website. Whenever someone visits your site, he can see the live chat window with a clickable link "Powered by..."

made with clickfunnels

Set up a resources page

By creating a list of resources, you can give your readers valuable information about the tools you recommend.

Describe the products you personally use in depth and include your affiliate links.

Make sure this page is written naturally and make it as useful as possible.

Paid advertising

The fastest way to get immediate results is to use paid advertising.

PPC advertising means "pay per click." With this type of advertising, you only pay when someone actually clicks on your ads.

When promoting products offering high commission, you can still make a profit even if you only have a 1% or less success rate.

The best thing is that some advertising platforms like Facebook allow you to target your audience based on many different features, such as their sex, age, location, job description, marital status and even hobbies.

This means you're only advertising to people who are likely to want to buy your product.

On the other hand, Google Adwords allows you to target by different search terms and get the same benefits as SEO. Similarly, you'll be charged when someone clicks on your ad.

cpa cpm ppc

How to protect your links

Now, let’s have a few words about link cloaking. Link cloaking is the process of hiding and protecting your affiliate links. This way, your links will have a clear, short structure and ease of management.

Some paid advertising systems do not allow you to promote affiliate links but with link cloaking, you can easily solve this problem. Many affiliate link cloaking tools give you extras to help you cloak, track and organize your links using your own domain.

One of the most popular link cloaking tools is Pretty links. It's a plugin for WordPress.

By pointing the link at something else on your website, it increases the possibility that people will click on it. Therefore, it can increase your conversion rate, too.

When a visitor clicks on your link, it will perform a redirection to your affiliate page. By creating a simple webpage and redirection manually, you can even use this feature without a link cloaking software.

You can redirect a page to another page in several ways:

  • ​javascript redirects
  • ​server-side redirects
  • ​HTML meta refresh redirects.

Besides these, there is another popular way to hide your affiliate links and drive traffic to your affiliate offers. By building a bridge page which is usually an opt-in page for list building, you can hide your affiliate link and promote only the bridge page.

When visitors opt into your email list, they will be redirected to your affiliate offer and at the same time, you will also be able to communicate with them via email. 

prettylinks

Example of Clickmagick:

Conclusion

Does all this sound like a vast amount of work and time? You are right, it is. However, it's the key to success and later, to a passive income.

Believe me. There is no "get rich quick" scheme.

When you're a trusted source, people will take your advice and you'll be able to sell any product you want.

Remember, it will only work if you recommend quality products you're using and excited about. Otherwise, how could you describe in great detail what you like and what you don't like about these products and also show your enthusiasm in the meantime.

Again, you don't want to lose the respect of your followers with a bad quality product.

Affiliate marketing is definitely an excellent way to earn a passive income but it won't happen overnight. You’re going to have to put a lot of hard work into it.

A lot of your experience and growth will come through trial and error. Treat your affiliate marketing as a real business and it will grow and develop over time.

We've discussed a ton of different methods you can use to start making money from affiliate products. Now I hope you’re confident and ready to take action.

What kind of affiliate products are you promoting now and what have you achieved so far? Have you had any success yet? Let me know in the comments below how you are getting on and of course, I'll be happy to help if you needed any.

Furthermore, should you want to talk to me in private just connect with me on Facebook.

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About the Author

Most people write this part in the third person but I won't. You're at the right place if you want to start or grow your online business. When I'm not busy scaling up my own or other people' businesses, you'll find me trying out new things and discovering new places. Connect with me on Facebook, just let me know how I can help.

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