Affiliate marketing is more than a buzzword right now; it’s one of the best ways for brands to make money.
The affiliate market was valued at 16 billion dollars in 2023 and is expected to surpass $30 billion by 2030.
Statistics aside, these numbers don’t answer the question - what is affiliate marketing and how can your business start using it?
Here’s your crash course in affiliate marketing – what you need to know and how to make it work for your brand.
Table of Contents
Affiliate Marketing 101
What is Affiliate Marketing?
Affiliate marketing is a performance-based marketing strategy where businesses reward partners for driving sales through their marketing efforts. These partners are called affiliates.
Affiliates list or promote products (or services) through unique tracking links which show where the visit came from. They earn a commission for each successful referral, thanks to that unique tracking link.
These links have major benefits for brands, too. You can see exactly where your sales are coming from, which partners drive the most sales, and prove the ROI of your marketing programs.
The Affiliate Model
The affiliate model is made possible with these three parties:
Merchant (Advertiser): The business or brand looking to sell a product or service.
Affiliate (Publisher): The partner promoting the merchant’s product in exchange for a commission.
Consumer: The end-user who purchases the product or service through the affiliate’s marketing efforts.
Affiliate marketing uses a partner's reach and credibility to introduce or recommend products to a broader audience, making it a win-win situation for the business and the affiliate.
What is an Affiliate Marketing Platform?
An affiliate marketing platform is how businesses manage the programs they’re running. On these platforms, they can see tracked referrals, manage payouts to affiliates, and dig into the analytics to optimize their programs.
Some of the key functions you’ll find on an affiliate marketing platform include:
Tracking: Monitoring the performance of affiliates through unique referral links.
Management: Organizing affiliate relationships, communications, and terms.
Payment: Automating commission payments to affiliates based on performance.
Analytics: Providing insights into which affiliates and marketing tactics are most effective.
Some popular affiliate marketing platforms that facilitate these functions include Mavely, Rakuten, Partnerize, Ascend, AWIN, ShareASale, and Avant a Link.
While they all differ slightly, these platforms offer a similar set of tools to help businesses scale their affiliate marketing efforts efficiently.
How do Affiliate and Influencer Marketing Work Together?
Working with affiliates is a great way to track the ROI of your influencer marketing program.
Creators and influencers make the perfect affiliates - they have engaged followings, connect your brand to new audiences, and often develop lasting relationships with brands.
By setting up the influencers you already work with on your affiliate platform - or finding new ones who align with your campaign goals - you'll be able to track the performance and prove the value of your influencer marketing program.
Need to find the right influencers for your brand? Later Influence has a database of 10M+ vetted creators. Set up a call to see how our platform works today.
The Benefits of Affiliate Marketing
Affiliate marketing doesn’t suit every business type, but it can offer cutting-edge advantages for certain online merchants.
Here’s why you might consider it as part of your marketing strategy:
It can be cost-effective. Because most of the payout for affiliates is based on commission, you minimize upfront costs. Since payments are commission-based, you spend when a sale or a desired action is completed. According to Rakuten/Forrester Research, over 80% of advertisers set aside around 10% of their marketing budget for affiliate marketing projects.
You can increase your reach. When you collaborate with the right creators, you can reach new audiences. Affiliates often have established followings and can introduce your products to potential customers you might not otherwise reach.
It’s a way to enhance your credibility. Affiliates often give authentic endorsements, increasing trust with their audience. According to Nielsen Trust, 88% of customers have made buying choices because an influencer recommended something.
It’s all performance-based: It lets you focus on measurable outcomes like sales and leads, ensuring that your marketing spend is directly tied to results.
You can scale easily. Scaling can be achieved by adding more affiliates. As your affiliate program grows, so does your potential to drive more sales and brand awareness.
Pro-Tip: If you want to work with creators who will bring you the best results from affiliate marketing, you’ll want to make your brand appealing to work with. Because of this, consider providing an upfront payment as well as a commission.
How to Integrate Affiliate Marketing into Your Existing Marketing Mix
You don’t need to abandon tactics that are already working; affiliate marketing can easily be added to your existing marketing mix.
Before getting started, we have a few tips to make it as seamless as possible to incorporate a new affiliate program.
Figure out what’s important. First, you’ll need to determine what you want to achieve with your affiliate program. Do you want to drive more sales overall, sell a new product, or focus on one particular collection? Make sure this aligns with your existing campaigns.
Choose your affiliate platform. Next, choose an affiliate marketing platform that aligns with your business needs and can scale as your program grows. You’ll want to find tools that will help you launch and grow your program with ease.
Recruit your affiliates. Once you have a platform, you can find influencers and onboard affiliates whose audience matches your target market. Try to find affiliates with an engaged following that are relevant to your industry.
Be ready with resources. For the best results, it’s a good idea to equip affiliates with messaging that aligns with your other marketing campaigns, product information, and clear guidelines. This sets them up to promote your products and start making those sales.
Learn and keep improving. Track your affiliate performance and gather insights to optimize your program. Dig into your analytics to assess which affiliates drive the most value, and adjust commission structures as needed. Notice a product selling out or a campaign not working? This could indicate shifts that need to be made in your overall marketing strategy.
Investing in an influencer marketing platform like Later Influence makes it easy to find creators, manage campaigns, and start making money.
With Later Influence, you can streamline the process of finding the right creators for your affiliate marketing program, making sure you get the most out of your affiliate efforts.
How to Set Up an Affiliate Program with Influencers
If you’re ready to set up an affiliate program with influencers, here are our top five tips:
Find relevant influencers for your brand. Use tools like Later’s influencer marketing platform to discover and assess influencers who align with your brand and have a relevant audience.
Establish your affiliate terms. Define up-front payments, commission rates, payment schedules, and performance metrics. You should be transparent with influencers about what they can expect - and distribute payments on time.
Create unique links with your platform. Generate tracking links for each influencer to monitor their referrals and ensure accurate commission payments.
Offer suitable support. Provide ongoing support and resources to help your influencers succeed with their marketing. This includes regular communication, providing promotional materials, and getting their feedback.
Analyze your results. Use analytics to measure the impact of your influencers and adjust your strategies as needed. You can look at metrics like conversion rates, average order value, and ROI to see what’s working, and what needs tweaking.
As reported by Astute Analytica, experts predict that by 2030, the value of the affiliate marketing industry could reach $40 billion.
It’s time to start working with creators and getting ahead of the game. Book a demo with Later Influence to see how our platform could help you find creators, manage campaigns, and support your affiliate marketing efforts with a best-in-class influencer marketing campaign.
