How Do People Become Millionaires With Affiliate Marketing?

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Today I want to talk about affiliate marketing for one simple reason.

I often see people who don’t understand what affiliate marketing is and how it is possible to make a lot of money doing it.

So in this post, I want to break it down for those who are unfamiliar with affiliate marketing and how it works.

Let’s jump in!

How Do People Become Millionaires With Affiliate Marketing?

What exactly is affiliate marketing?

Well, affiliate marketing is based on revenue sharing and performance.

If you have a product and you want to sell more, you can offer people who have a big engaging audience to promote your product in return for a commission.

If you don’t own a product but you want to make money you can start promoting somebody else’s product through an affiliate program and earn a commission.

It’s a win-win strategy.

How does affiliate marketing work?

To understand how affiliate marketing works you need to understand the system. There are three different parties involved:

Merchant – also known as an advertiser, product creator, vendor, or seller. It’s a person who already has a product, service, or information ready to market.

Publisher – also known as an affiliate. It’s a person or a company that promotes a merchant’s product or service. The publisher gets the commission as an affiliate for every purchase that the customer makes through the unique affiliate link.

Often, the most challenging part is to build a platform with massive reach.

Customer – once everything is in place, as an affiliate, you start creating nice content that brings value. That’s how you start growing your audience, which will become your potential customers, depending on what marketing strategy you use.

In other words, in an affiliate marketing business, you can become a merchant if you have a product ready to market. And then have others promote your product, in exchange for giving them a commission from the sales that they make.

Or, you can become an affiliate marketer and promote and market one or several products that you like. Then get a commission on every purchase you generate.

How exactly do affiliate marketers get paid?

Well, there are three different ways of how affiliate marketers get paid:

1. Pay-per-sale (PPS)

It’s the most basic structure in affiliate marketing. In this case, a merchant will pay an affiliate a percentage of the sale price of the product that an affiliate generates. It varies from 3% to 75 or even 100%, depending on the affiliate program.

2. Pay-per-click (PPC)

The idea of a pay-per-click program is based on web traffic. When an affiliate redirects people from their platform to the website of the merchant he or she gets a commission on that.

3. Pay-per-lead (PPL)

It’s when an affiliate persuades a consumer to visit a merchant’s website and complete the desired action. It can be signing up for a trial of a product, filling out a contact form, subscribing to a newsletter, etc. It’s based on the conversion of leads.

6 Reasons that make sense of why people start an affiliate marketing business

1) It’s far cheaper than starting a traditional business.

To understand the big picture let’s look at some start-up costs you may need to expect to pay in a traditional business:

*It depends on the business

Products and Inventory – $4,000-$100,000
Incorporation Fees – $250-$1000
Equipment – $6,000- $100,000
Office/Business Lease- $10,000- $65,000
Utilities – $1,500
Website Design – $100 – $500
Website Hosting – $10 – $100
Education- $0 – $25,000
Insurance – $1,300- $5,000
Marketing & Advertising – $3,000-$25,000
Payroll – $0 – $100,000
Franchise Fees – $0 – $100,000
Market Research – $1,000- $10,000

So as you can see, in a traditional business you need to have good capital to get it off the ground.

In an online business, you won’t have to spend on rent, equipment, franchise fees, products, and inventories. That already gives you a huge head start.

Moreover, affiliate programs are free to join! (Some of the most popular affiliate websites are Clickbank, Amazon Associates, ShareASale Affiliates, etc. )

However, if you want affiliate marketing to be your passive income in the future you will want to create a platform that will be yours.

For that, you will need to consider some costs of web hosting, design, maybe education or coaching, and some marketing.

2) Low Risk

As I said affiliate programs are free to join. All you need to do is to promote already-established products or services. It means you don’t need an upfront investment, so there’s nothing to lose basically.

Another case is when you invest in web hosting, email marketing platforms, and web design, then you want your content to be viral and bring value. That way you can generate more traffic.

3) You can choose the product.

Another great benefit of affiliate marketing is that you can choose a product or service to promote. It can be related to your niche or it can be something that you love and recommend to others.

There are thousands of affiliate programs out there that you can sign up for in 2 minutes.

4) You are professionally independent

That means you are your own boss! How cool is that?

You can choose your own hours from anywhere in the world as long as you have an internet connection.

5) You can scale your earnings

Once you have your engaging audience buying your current product you can build campaigns for additional products or services and introduce them to your current audience.

As a result, you can scale your earnings while your existing work continues to generate revenue.

6) You don’t need the experience to work as an affiliate

To become successful in affiliate marketing you don’t need previous experience. But in fact, you will have to learn a lot on the way!

One of the greatest reasons why people start an affiliate marketing business is this. Once your affiliate marketing business is up and running successfully, it turns into passive income. That means you’re making money while sleeping.

But every successful entrepreneur knows that there are always more ways and strategies to implement in the business to help it grow along with bringing more quality and value to the customers and followers.

Thanks for reading, I hope it helped!

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Are you planning on working as an affiliate marketer? What do you think the best platforms for affiliate marketing are?