Hey guys, I started a series on affiliate marketing on this blog where I have been explaining in details how to start affiliate marketing and how to become a successful affiliate marketer.
This post is the second in the series, you can find the first part by clicking here (Don’t worry, link opens in new tab), so if you have come to this post directly, then you should pause right here and go to the first part so as not to miss the loads of information I have shared there, as this post will be building on the information that I have already put out over there.
How do affiliate marketers get paid?
There are 3 major ways that I know of, I don’t know of anyone else, except its new and I am yet to get wind of it.
- Pay per sale.
- Pay per lead.
- Pay per click.
1: Pay per sale.
This is the primary or let me say the basic affiliate marketing payment structure.
It means that the affiliate marketer only gets paid when the consumer buys the product from the seller or merchant.
So even if the consumer goes to the merchant’s website through the affiliate’s marketing efforts and the consumer doesn’t buy anything, then the affiliate doesn’t get paid anything.
This can seem unfavorable, but then, there’s a very high chance that the consumer will buy that product or service from the merchant.
When affiliate marketing started to gain a foothold in e-commerce, merchants, and affiliates both noticed that some consumers will click through from the affiliate’s website but won’t buy the product immediately.
They can then come back at a later time to buy the product. This resulted in no commission for the affiliate, even though it was the affiliate marketer’s marketing efforts that sold the product to that consumer.
In order to tackle this, we have some models called the last click and first clicks, But I will get back to that as we move forward.
What merchants do is that, when a customer clicks an affiliate’s link and goes to the merchant’s site, a cookie is saved on the customer’s browser.
That cookie will have an expiry date, the expiry date varies between merchants and affiliate networks.
What the cookie does is that, if the consumer doesn’t buy the product in the first instance and instead returns at a later time to buy it, the sale will still be recorded for the affiliate as long as that cookie has not expired.
So, for example, I am promoting a dress from shopstylecollective, their cookie’s expiry date is 90 days.
When someone from my audience clicks my affiliate link and goes to shopstylecollective’s store, a cookie will be saved on the customer’s browser, which will expire in 90 days.
If that consumer doesn’t buy that product on the first day, but returns in 89 days, and buys that product, I will still get my affiliate commission, but if the consumer returns in 91 days and buys that product, then I won’t get any commission, because by then, the cookie would have already expired and all the payment from the sales goes to the Merchant.
2: Pay per lead.
This is a model where the affiliate directs all their marketing effort into convincing the consumer to complete an action on the merchant’s website.
The desired action can be filling out a contact form or signing up for a trial of a product, subscribing to a newsletter, or downloading software or files.
This affiliate payment structure is by far margins better and easier to accomplish for the affiliate marketer.
There are so many desired actions that merchants that offer pay per Lead can put out to affiliate marketers. This is basically used to drive attention to services or new products.
I love using this model a lot, especially on amazon affiliates.
This is because Amazon has a lot of products and services that they make available for free testing or huge discounts to consumers.
People love free services and huge discounts, my job will be to just alert my audience that there’s a free product or service waiting for them behind this link.
Last year’s Amazon Prime day was a massive day for my Amazon affiliate’s account. Amazon made it so easy for us to make money…
For everyone who signs up to a one-month free Amazon prime trial, I will get 3USD flat. The good thing is, there were huge discounts on Amazon that day but were only available Amazon prime members. So there it was, free amazon prime membership for a month, just to get the massive discount.
I got over 900 leads that day alone.
Not all merchants offer this type of structure, but when you see a merchant in your niche providing such structures, then you have to jump on it.
Quickly carry out your research, create a very detailed and valuable unique post around that product or service from the merchant, then focus all your content marketing efforts on that post.
This kind of marketing effort is also called bounties.
3: Pay per click.
This is a payment structure where the affiliate is paid for every click through on the affiliate marketer’s link to the merchant website.
Whether the user buys any products or not, the affiliate gets paid. This means that the affiliate has to convince their own audience to make the trip, from their own website to the merchant’s website.
This is mainly used by merchants to increase their web traffic and traction around certain products or services.
This is also the easiest form of payment structure. The affiliate marketer does less work than the other they would be required to do in the other two payment structures.
As a matter of fact, the affiliate marketer can just simply place a banner on their site promoting the product. We all know banners have a high click-through rate, especially when the banner is very attractive.
The con-side of the structure is that merchants tend to pay very low commissions, and also, it is quite rare to find merchants that offer this structure.
Most affiliate marketing merchants out there are already big enough to drive their own traffic, they could also decide to run adverts on Google, Facebook, Instagram etc. instead of paying affiliate marketers to drive traffic for them.
Another disadvantage of this structure is that you will be driving your own traffic to another person’s website.
To be able to convince your own audience to go to another person’s site, both your blog and the merchant’s site has to be of the same niche.
In other words, you are sending your own traffic to your competitors.
That’s not all, each user you are sending away to your competitors could be making serious and big actions on your competitor’s site.
Same actions they could be making on your own site and you will be the one making the same money your competitor is now making.
I will be stopping right here for this part, I will continue this series in the next part, so make sure to stick around.
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