Affiliate marketing. It’s a subject that we get asked about a lot at Tree Ring Digital, so we’re embarking on a short series of blogs to cover the ins and outs – what is it? Is it a good way to make money? Should your business start an affiliate marketing program? There’s a lot to know, but we’ve got you covered. It’s something Tree Ring knows a lot about, so let us break it down for you.
What is Affiliate Marketing (AM)?
According to Investopedia, “Affiliate marketing is an advertising model in which a company compensates third-party publishers to generate traffic or leads to the company’s products and services. The third-party publishers are affiliates, and the commission fee incentivizes them to find ways to promote the company.” Here’s an excellent infographic that helps to explain.
So for the purposes of this blog, let’s imagine that Mary owns a company called “Mary’s Marvelous Widgets.” She has a great website, but she’s not getting the traffic she’d like. Mary follows a blogger named Will, who goes by “Will the Widget Wizard.” Will is kind of a big deal in the widget community, so Mary asks him if he’d consider being an affiliate marketer – which means she’s asking him to put “banner ads, text ads, or links” on his blog, website, etc., that recommend Mary’s Marvelous Widgets in exchange for a percentage (usually 5 – 10% of the sales gleaned from the affiliation). Will thinks that’s a great idea, and because of Will’s following they both make lots of money. Sounds great, right?
Affiliate Marketing: What’s Not to Like?
While affiliate marketing can be a lucrative proposition for all concerned, it has to be done right. Again, Investopedia: “Unscrupulous affiliates can squat on domain names with misspellings and get a commission for the redirect. They can populate online registration forms with fake or stolen information, and they can purchase AdWords on search terms the company already ranks high on, and so on. Even if the terms and conditions are clear, an affiliate marketing program requires that someone monitor affiliates and enforce rules.” Ouch. Nobody’s got time for that.
Hire a Pro to Create Your Affiliate Program
Obviously, creating an affiliate marketing program requires experience and planning – a great one could help your business get a lot of new customers, but a bad one could be costly and damage your hard-earned reputation.
If, however, your company can access creative people with established reputations who are motivated to help sell your product or services, affiliate marketing can be an excellent way to boost your income.
Here are some great statistics from Hosting Tribunal :
- Affiliate marketing (AM) spending is bound to grow by 10% in the next few years.
- Worth $12 billion, the AM sector is growing rapidly.
- AM accounts for 15% of all digital media revenue.
- Well-crafted affiliate marketing programs can boost revenue by a staggering 30%.
- That boost amounts to 15%-30% of all sales being generated by AM.
- Together with email marketing, AM is one of the largest sources of online income, accounting for over 16% of all ecommerce orders in the USA and Canada.
We’ll get into more detail in our next blog in the series, but in the meantime if you want to find out more, call Tree Ring Digital.
- On March 18, 2021