Performance Marketing: How Does Affiliate Marketing Work? The FAQs

Affiliate marketing is a genius concept based on performance marketing. It is so simple and yet so effective that it is rapidly becoming the career of choice for many people. It is an integral part of a system that has no boundaries and constantly updates and expands itself.

How does it work? 

As we’ve mentioned, it is performance based marketing. Affiliated get more money based n their performance in marketing or promoting a product because it results in sales.

  1. A merchant has a product or knowledge that would benefit someone else.
  2. Although they are the expert in their field, they have either no idea or no time to market the product themselves. 
  3. So they offer a commission to anyone who can get traffic to their sales page and who subsequently makes a sale.

How does the merchant know who has sent the traffic to their site? 

Affiliates are given a special link that is specific to them. When they put this link in their advertising – e.g., in an article or a banner and this link is clicked on, it tells the merchant exactly where the visitor to their site has come from.

How does the merchant know who the commission belongs to? 

This link then follows the visitor through the whole buying process and can even tell when they make subsequent purchases, allowing the affiliate to get future commissions from the one sale.

Who regulates affiliate marketing?

The FTC (Federal Trade Commission) is the government body responsible for regulating all affiliate marketing or other performance marketing activities. This is a way to protect both the marketer and the business from any fraudulent activity or scammers. Even though there is no official contract signed between the two parties, there are still ways that the FTC can protect both parties. 

So an affiliate is a glorified salesperson? 

Yes and no. The job of the affiliate is to get people interested enough that they click through to the merchant’s sales page. You could call it ‘pre-selling‘ the product, but if you choose products that you are interested in or know that there is a market for, then it is not hard to write about them.

What makes this any different from direct marketing? 

Here is the best part. Your potential buyers come looking for you. That’s right, no pushy, in-your-face selling that can make people resentful and feel like they were pressured into buying. No. The whole reason that people get to your article or ad in the first place is that they were already looking for information on your product – that’s where the ‘genius’ part comes in.

So you are giving people what they want? 

Exactly. Think of how you ended up on this page. Chances are that you wanted to know about affiliate or internet marketing? (If you’d wanted to know about training dogs, then you would have been taken to a more relevant site)

Even if you don’t make a sale, the chances are that you will have helped the visitor by giving them some answers or information that has helped them, and this will help to build your brand, which will also help to generate more traffic in the future.

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