Businesses are more frequently seeing the benefits of affiliate marketing in their strategies today.
Affiliate marketing allows companies to effectively market a product with a low budget, low effort and time, and at a well-contained risk level while guaranteeing a high return on your investment, increase in brand awareness, and business growth.
Of course, some things sounds too good to be true, but in this case the benefits are a consequence of marketing that is highly targeted and effective. Businesses are able to identify a target market and select the perfect set of representatives that’ll suit the brand—this is exactly what affiliate marketing does.
Before you launch out, you should first learn about best practices and tips that you’ll need to perfectly execute your affiliate marketing campaign. Let’s go over what affiliate marketing is and some of the key benefits that come from adopting it as a strategy.
This type of marketing involves hiring people to promote your product and rewarding them for their efforts on a commission basis—this is an effective strategy that brands employ to improve sales. Quite often, it’s better used in tandem other marketing outreach strategies.
Affiliate marketing usually involves a partnership between a business and an affiliate to help promote the sale of their product, with the retailer agreeing to pay a commission to the affiliate marketer for every sale they drive.
For online-based businesses, the affiliate uses a unique link that’s created to track traffic that’s directed to the site. The affiliate gets a certain percentage of sales made through those links.
Since 2015, revenue from affiliate marketing programs grows by 10% annually. The projections are this impressive trend to continue at least until 2021.
According to Statistica, affiliate marketing spending in the U.S alone is expected to reach $8.2 billion by 2022.
Why are companies spending so much on affiliate marketing campaigns? Below are some of the benefits of using affiliate marketers in your business:
An affiliate program does not require that you have an advertising team for ad visuals or purchase ad space.
Rather than that, you’ll have to depend on your affiliates to come up with their marketing content. Other than the initial effort of selecting and vetting affiliates, there’s little effort required from you to market your products, which is one of the reasons it’s become such a popular method of marketing.
Once a company is comfortable working with an affiliate and has built a good relationship, they can for the most part let them get on with marketing your service or product.
Since most of your marketing activities are done by affiliates, they’ll also bear the chunk of the cost attached. And since it’s a commission-based program, it means that you’ll only pay affiliates from sales they bring in.
This marketing model makes cost easy to manage and does not interrupt your cash flow, unlike other marketing models such as PPC advertising that requires you to pay for every click leading to your website. But affiliate marketing ensures that you only part ways with your money when sales are made.
Lost cost means low risk. There’s little risk of loss since payments are only made when there’s an actual conversion; perfect for businesses on a tight budget.
Since the affiliates are handpicked by you, it can ensure that the traffic that comes to your site is from individuals that find your product or service useful. This is because affiliates that resonate with your brand will most likely have individuals with their area of influence that’ll find your brand useful.
You can easily make your affiliate program smaller or bigger at little or no cost. It also offers you a great way to scale up your business without breaking the bank.
Having the keys to product innovation and effective management skills doesn’t guarantee a high ROI; you’ll also need to get your marketing right.
Affiliate marketing has been proven to have a much higher return on investment than the majority of marketing strategies.
One major reason for this is because your target audience will hear of your product or service from affiliates that are within their spheres of influence. In short, you’re channeling your marketing efforts through an affiliate who has direct access and influence over a highly targeted audience that is receptive to what you have to offer.
Affiliate marketing is quickly becoming a central aspect of many marketing strategies, largely because of the high bang for your buck that other strategies cannot offer.
As the market continues to grow, the benefits of affiliate marketing are more apparent to businesses of all sizes, and we can expect to see more organizations use the method more frequently in the future.