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What is affiliate marketing?

Affiliate marketing is a way to earn money, in commissions, every time someone promotes a company’s products or services, and drives sales. Here’s how it works.

How many times have you lamented the limitations of your marketing efforts due to budget or time? Sure, your brand would be as big as Apple if you had their massive marketing teams!

Well, what if we told you that there’s a way to get an endless number of businesses, influencers and individuals marketing your product or service for no initial outlay and for just a small percentage of commission?

It’s called affiliate marketing, and it’s being embraced by global brands and SMEs around the world.

What is affiliate marketing?

There are three different parties involved in affiliate marketing:

Seller and product creators: The seller is normally the manufacturer or retailer that has a product or service to market.

The affiliate (or advertiser): The affiliate can be an individual or company that markets the product or service on their website or social media, with the view to making sales. When the product or service is sold, the affiliate receives a portion of the revenue.

The consumer: If you shop online, chances are you have purchased from an affiliate. While affiliates will sometimes choose to disclose to the consumer that they are receiving commission for the sales they make, it’s usually a seamless process.

Consumers rarely pay more for the product purchased through affiliate marketing because the affiliate’s share of the profit is included in the retail price. The consumer will complete the purchase process and receive the product as normal.

How does affiliate marketing work?

Affiliate marketing is a model whereby an individual or company earns a commission by promoting or marketing a product and service of another company.

Affiliates run advertisements or reviews, and when the consumer clicks through they are taken to the seller’s web page and goes through their fulfilment process.

Commissions are usually based on actual sales, but in some cases affiliates can be rewarded for leads, click-throughs, or downloads.

What are the benefits of affiliate marketing?

For the seller, affiliate programs increase their reach, and often allow them to target niche cohorts. For example, a popular photographer may be an affiliate that markets camera equipment.

The return on investment (ROI) is excellent because sellers only pay for the affiliate’s marketing efforts when a sale is made.

For affiliates, affiliate marketing is an easy way to earn extra passive income. There are little or no start-up costs, and it’s fairly easy to set up. Affiliates can work from home and can choose for themselves the time and effort they wish to invest.

For both parties, affiliate marketing is also scalable. Affiliates can introduce any number of new products to market to their audience, and sellers can grow their networks of affiliates by raising commission rates or offering other incentives.

Examples of affiliate marketing

There are established affiliate programs that tailor to the needs of the seller and the affiliate, and in Australia popular choices are:

Amazon Associates Program: Amazon is often described as being the original pioneer of affiliate marketing, and has one of the world’s largest networks. Its popularity lies in the extensive range of products, and commission depends on the type of product sold, but is usually between 5-50 per cent.

GrowthOps: GrowthOps is an Australia-based affiliate program with international reach. Some of the world’s best-known merchants, such as Dell and Estee Lauder, use the platform to find the right affiliates for their brands.

Impelus: Impelus is another Australian affiliate platform with global reach, and it’s popular because commissions are on a pay-per-lead basis.

Commission Factory: Commission Factory is another Australia-based affiliate program that caters specifically to businesses in Australia and the Asia-Pacific region, and is favoured by those who live their digital lives on devices, having mobile apps that can be accessed anywhere and anytime. Brands include Marley Spoon, Lenovo, and The Good Guys.

Talk to the marketing experts

If affiliate marketing is something you have been considering for your business as part of your broader marketing strategy, Assemblo can seamlessly integrate it into your mix of activities.

Assemblo is a full-service marketing agency based in Melbourne, staffed by professionals who understand how to maximise results from affiliate marketing – and every aspect of your marketing mix.

To find out how we can help your business, give us a call on (03) 9079 2555 or send us a note via the contact form below.

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