Affiliate Marketing Glossary – Understanding the Affiliate Marketing Facts

Affiliate Marketing Glossary – Understanding the Affiliate Marketing Facts

Many affiliate marketers generate six-figure incomes and beyond. You can do this too. With affiliate marketing, there is no need for you to have your own products and services to promote. Having a famous brand is also not necessary.

If you are skeptical about earning a fortune through affiliate marketing then there is no need to be. There is plenty of evidence around to confirm that many affiliates are earning a lot of money from their campaigns.

Affiliate marketing is where you promote other people’s products or services for a commission. You can promote physical products such as those you would find on Amazon.com, or digital products from affiliate networks such as Clickbank.com. Or you can promote physical and digital products if you want to.

The commissions that you will earn from promoting physical products will usually be on the low side. They are normally in the region of 3% to 8%. It is a different story with digital products as the commissions tend to be much higher. You can find digital products to promote that will pay you 50% to 100% commissions. It is easier to sell physical products though.

A good way to make consistent affiliate commissions is with new product launches. These are very popular in the make money online niche. Every day there are new products launched in this niche and you can become an affiliate for them and promote them to make commissions.

Product launches are not the only way for affiliates to make commissions. You have probably heard the term “the money is in the list”. This refers to having an email list of subscribers that are interested in your chosen niche.

You can send them automated emails and broadcast emails promoting new and existing products and services as an affiliate. When you decide to create your own product in your niche you can then promote this directly to your email subscribers.

Email marketing is one of the most effective ways to make money with affiliate marketing and we strongly recommend that you build an email list. Do not believe that email marketing is dead because it isn’t. It will be an effective means of marketing for years to come.

Another thing that you can do is to create product reviews. Creating video reviews and uploading them to YouTube can be very effective. It is a lot easier to rank a review video high in a YouTube search than it is a blog post in the search engines. Videos often rank on the first page of the search engines too.

Anyone can get started as an affiliate marketer with little expenditure. We do recommend that you purchase your own domain name and some web hosting. This is much better than going with a free website or blog offered by Weebly.com or WordPress.com.

People are very Internet savvy these days and they know if a blog is free. You are trying to encourage your visitors to purchase the products you are promoting as an affiliate. If you can’t be bothered to purchase your own domain name and hosting, why should they trust you?

Here are the main benefits of being an affiliate marketer:

  • You do not need to create your own products
  • There are thousands of affiliate offers for you to promote
  • You do not have to deal with any customer support issues such as refunds
  • You do not have to hold and ship any inventory
  • You can be a successful affiliate marketer at home
  • The cost of entry is very low
  • You can promote products in several different niches

These are the main reasons why there are so many affiliate markets these days promoting other people’s products and services to try and make commissions. Only a small percentage of these people are successful for a variety of reasons.

You do not need any experience to succeed with affiliate marketing. If you are an experienced online marketer then you can promote affiliate offers as a way to increase your income. Once you have set up your affiliate marketing campaigns, they can be a source of regular passive income for you.

We want you to be a successful affiliate marketer and to do this you need to fully understand the most common terminology that is used in the business. In this powerful report, we will provide you with an affiliate marketing A – Z with full explanations of what all of the terms mean.

The Basics of Affiliate Marketing

Before we get into the most common terminology used in affiliate marketing, we want to provide you with a comprehensive overview of what affiliate marketing is all about. If you already know this then you can skip this section and move on to the next.

It’s easy to get started

One of the main reasons why affiliate marketing is so popular is because it is very easy for anyone to get started. You do not need any experience to become an affiliate marketer and you can get started for next to nothing.

You don’t even need your own website but we strongly recommend that you invest in this. It will only cost around $10 a year for a domain name and you will need a web hosting account as well. Web hosting will cost you between $5 and $15 a month and you need this to make your website live on the Internet.

A lot of people do not want their own website because they think it is too difficult to create one. This is not the case as you can use the free WordPress blogging platform, and choose a free theme to use for the look and feel of your site. It is very easy to add new content to your website using the WordPress platform.

Once you have set everything up you can start to make affiliate commissions in a very short time. There are plenty of resources online such as YouTube videos that will show you how to start a profitable affiliate marketing campaign.

You could decide to just promote your affiliate offers on social media platforms such as Pinterest, Instagram, Facebook, and others. If you just do this then you do not need a website. The problem is that a social platform can take your content down for any reason and then you have nothing.

The Process of Affiliate Marketing

There are 3 players in an affiliate marketing transaction:

  1. The product or service vendor (the person or company that owns the products)
  2. The affiliate marketer (which is you) who promotes the products or services for an agreed commission
  3. The end customer that purchases the product or service

The product or service vendor takes care of the following:

  • Product or service creation
  • A compelling sales funnel to sell the product or service
  • All customer service support
  • The provision of unique affiliate links
  • The provision of marketing tools for affiliates
  • Paying affiliate commissions on time

Your job as an affiliate is to find the customers for the product or service. You will drive visitor traffic to the offers you promote using unique affiliate links. The affiliate links are unique to you and will associate you with any sales made so that you can earn your commissions.

The customer is the individual or business that purchases the product or service. If they have any support issues they will deal directly with the vendor. They will probably not even know that they have purchased a product or service using an affiliate link.

Affiliate Marketing Training

There are plenty of training courses around about how to be a successful affiliate. Some of these are free and you usually have to pay for the best ones. If you are serious about being successful with affiliate marketing then be prepared to invest in training courses that will help you.

You want to purchase an affiliate marketing training course from someone who has a good track record and sound reputation in the industry. A good example of someone with an excellent track record and reputation is John Crestani. He makes thousands of dollars every month as an affiliate.

John Crestani has a very popular course called the Super Affiliate System. This is a 6-week training program where you will learn everything that you need to know to be a successful affiliate. The Super Affiliate System will provide you with the following benefits:

  • Step by step affiliate marketing success
  • Choosing the right niche
  • The best affiliate networks
  • Finding the best offers to promote
  • Affiliate marketing mistakes to avoid
  • Websites and sales funnels
  • Effective methods to generate targeted visitor traffic (search engines, YouTube, solo ads, social media, and more)
  • Ad campaigns that convert
  • Million-dollar swipe file where John gives you his previously successful affiliate campaigns
  • Done for you funnel pages
  • A one-to-one call with John Crestani
  • Access to the secret community that will help and support you

And a whole lot more…

There is nothing that John Crestani doesn’t know about running successful affiliate marketing campaigns. The Super Affiliate System has hundreds of testimonials from satisfied customers and is the best affiliate marketing training around.

In the next section, we will discuss the most commonly used affiliate marketing terminology…

Affiliate Marketing A – Z

You must understand the most commonly used terms in affiliate marketing. Even the best training courses can gloss over this and will not explain the different terms well (if at all). Here is our A – Z of the most commonly used affiliate marketing terms:

Ad Blockers

An ad blocker is software code that people enable in their browsers to prevent ads from appearing on websites. The number of people using ad blockers has risen significantly over the years, and it is estimated that around 15% of Internet users have some form of ad blocker enabled.

Ad blockers are bad news for affiliate marketers. If your ad does not show up then you are not going to make any commissions. Unfortunately, there are a lot of unscrupulous marketers out there that have resulted in the creation of this technology. At the moment, there is nothing that you can do about adblocking.

Advertiser

The best way to understand an advertiser is that they are a company or an individual that has products or services that they want to promote. They are the product or service vendors. These advertisers know that by recruiting affiliates they will gain more exposure for their offers. An advertiser is willing to pay affiliates commissions for sales and/or leads that they bring.

Affiliate Campaign

An affiliate campaign is where you as the affiliate promote a product or a service to a targeted audience. Often the product or service vendor will have a sales funnel that you can promote. For every sale that you make you will receive an agreed commission from the vendor.

Affiliate campaigns are really about driving targeted traffic to an affiliate offer. You can choose a free or paid affiliate campaign:

  1. Free traffic from social media, search engines, and other sources
  2. Paid traffic from social media ads or search engine ads

All good affiliate campaigns will show the number of visitors that you drive to the offer, the conversion into sales, the source of the traffic, and more. You can examine the metrics of your affiliate campaigns and then make changes to improve conversion rates for example.

Affiliate Disclosure

An affiliate disclosure is a statement that you make on your website to explain that you are an affiliate for some or all of the products and services that you promote. Here you will inform your website visitors that if they use the links on your site and make purchases then you may be compensated for this in the form of a commission.

The Federal Trade Commission (FTC) in the United States has passed a law that all affiliate marketers need to include an affiliate disclosure on their website. Failure to do this can result in hefty fines.

Affiliate Link

Sometimes you will see an affiliate link referred to as an affiliate ID or a referral link. When you become an affiliate for a product or a service then your unique affiliate link distinguishes you from every other affiliate. Some affiliate networks have thousands of affiliates so this is very important.

The vendor needs to be able to associate a sale with you. Using a unique affiliate link is the best way to do this. Usually, when you sign up for an affiliate program you will be asked to provide a unique username. This is then incorporated into your unique affiliate links.

Your unique affiliate link is vital for your commissions. You do not want to do a lot of work promoting a product or service only for your sales to be accredited to another affiliate! These days, affiliate programs and networks have a feature where you can automatically copy your unique affiliate link. Make sure that you use this correctly.

Affiliate Manager

Some affiliate networks have dedicated affiliate managers which are there to help you succeed. They can communicate directly with you using email or instant messenger. It is a good idea to keep in touch with your affiliate manager as they usually have the inside track on the best converting affiliate offers.

Affiliate Network

An affiliate network is a website that will provide you access to different affiliate offers. One of the most famous affiliate networks around is Clickbank.com which can provide you access to thousands of different affiliate offers.

Most affiliate networks will provide you with important metrics about their affiliate offers. You will usually be able to see how popular a product or service is, how well it converts, the commission that you can earn, and more.

Affiliate networks bring product and service vendors and affiliates together. Unless a vendor has their own affiliate program, they will use an affiliate network to make affiliates aware of their offers. With some affiliate networks, there is automatic approval to promote products and services. Others will require you to gain approval from individual product vendors.

Affiliate Offer

An affiliate offer is an individual product or service that you can promote for a commission. Most affiliate networks will list the affiliate offers that they have available and provide important metrics such as sales volume, conversion rates, and more.

For each affiliate offer, you will usually have a unique affiliate link available. When one of your visitors clicks on this link they will go to the sales funnel for the product or service and you will be credited for this. If they make any purchases then you will earn commissions.

Affiliate Program

An affiliate program is a system that enables product and service vendors to recruit and pay commissions to affiliates. The vendor can set the amount of commission that they will pay for each sale. Affiliates will use the program to register as an affiliate and to obtain their unique affiliate links.

Average Order Value

This is where the affiliate network will disclose how much the average order value is for each affiliate offer. Many products and services have upgrades where the customer can enhance their purchase. These are called “back end” offers and will be presented to the customer as soon as they have purchased the “front end” product or service.

The average order value will take these upgrade sales into account. You will see the average amount of money that customers spend when they purchase a particular product. This is important as usually, you will earn commissions on any upgrades as well as front-end sales.

Bonuses

Affiliate marketing can be very competitive and when you can offer related bonuses to customers that other affiliates cannot offer then you will have an advantage. You will see bonuses offered a lot in the make money online or Internet marketing niche.

For example, if you are going to promote an affiliate offer that teaches how to create an email list and sell to it, you could offer your own email swipes as a bonus. These are emails that you have used in the past that have good conversion rates. If a customer feels that you are offering the best bonuses then they will use your affiliate link for their purchase and you get the commission.

Click-Through Rates (CTR)

The click-through rate (CTR) is an important metric that measures the number of times your affiliate offer link is clicked. It is based on the number of impressions that your link gets and is expressed as a percentage. If you can achieve a high CTR then you will have a better chance of making more commissions.

Let’s say that you have an email list of 10,000 subscribers. You send out an email with your affiliate link in it and 5,000 of your subscribers open your email. This means that your link has 5,000 impressions. If 500 of your subscribers click on your link then your CTR is 10%.

Conversion Rate

This is another very important metric. Using our example for click-through rates above, you send 500 people to the affiliate offer that you are promoting. The number of people that make a purchase is used to calculate your conversion rate.

So, if 50 people from the 500 make a purchase then your conversion rate is 10%. As with click-through rates, the higher your conversion rates the better. Affiliates can test conversion rates for different offers. They can use paid traffic to see how many of their clicks result in sales. If the conversion rate is high then they can invest in more traffic to make more money.

Cookies

A cookie is a small piece of code used to identify a visitor that clicked on one of your affiliate links. Cookies are used for tracking and the affiliate program or network will usually recognize them for a specified time.

Let’s say that the offer you are promoting has a 30 day cookie period. This means that if the visitor returns to the sales page for the product or service within this period, the original affiliate that referred them will be credited with the sale and earn the commission.

Cost Per Action (CPA)

Cost per action (CPA) marketing is where affiliates will receive a commission if a visitor to their affiliate link performs a specific action. This could be something like entering their email address, completing a simple form, entering their zip code, and so on.

A lot of affiliate marketers prefer to use CPA offers as there is no sale required to make a commission. The conversion rates tend to be a lot higher with CPA offers as the visitor does not need to make a purchase. Commission rates for CPA offers tend to be lower than for making sales though.

Cost Per Lead (CPL)

Cost per lead (CPL) marketing is usually where a visitor needs to provide their email address, call a specific phone number, or provide some other way for the advertiser to contact them. No sale has to take place for an affiliate marketer to receive a commission with CPL offers.

Cost Per Sale (CPS)

Cost per sale (CPS) is the most common form of the affiliate offer. The affiliate is paid an agreed commission each time a visitor that they referred makes a purchase. Usually, CPS offers have higher commission rates than CPA or CPL offers. But this is not always the case so make sure that you do your homework.

Data Feeds

Some affiliate networks or programs will offer their affiliates a data feed that they can use on their website. It is a file that contains the products and services that an advertiser sells which will include things such as:

  • Product or service names
  • Prices for the products or services
  • Images for the products or services
  • Descriptions
  • Unique affiliate links

An affiliate can use this data feed to display the entire product range on their website. If a visitor clicks on the affiliate link in the data feed to find out more and then makes a purchase, the affiliate will earn a commission.

Earnings Per Click (EPC)

This is another very important metric that you need to know about. The affiliate network or program may provide EPC figures for all of its products and services. An EPC is expressed in monetary format e.g. $10 and is a measure of the commission amount that any affiliate will earn for each click of their affiliate link.

Impressions

Impressions are the number of times that your ad or affiliate link is shown. Some websites charge advertisers on a “cost per thousand impressions (CPM) basis”. With email marketing, your impressions are the number of times that a subscriber opens your emails and sees your affiliate link.

Landing Page

A landing page is a webpage that you send your visitors to when they click on your links. This could be direct to the sales page of the product or service for example. Savvy affiliate marketers are now sending their visitors to their own landing pages instead of direct linking to a sales page.

One of the best reasons to do this is to capture the email address of the visitor. Once you have their email address you can then automatically send them to the vendor sales page. You can also use a landing page or a bridge page to warm up your visitor before they see the vendor sales page.

Several advertising networks will not allow you to send visitors directly to a sales page. Google and Facebook will insist that you create an informative landing page. Where you send the visitor after that is up to you.

Leads

If you want to be successful as an affiliate marketer you should go after both leads and sales. By using a landing page where you capture the email address of your visitor first, you are creating a valuable lead that you can communicate with over and over again. Some of the leads will make purchases using your affiliate link resulting in more commissions.

Email leads are important because you can connect with your visitors whenever you want. If you just send a visitor to the vendor sales page then if they do not make a purchase, you can lose them forever. Not everyone is going to make a purchase the first time that they see an offer. Collecting email leads enables you to communicate directly with your visitors again.

Niche Markets

The most successful affiliate marketers focus on specific niche markets. They create a website around their chosen niche and provide value to their visitors through content. Affiliate offers that are related to the niche can be promoted to earn commissions.

Choosing the right niche is very important. You need to ensure that there is sufficient demand for the niche and that there is money being made in it. The most popular niches where money is certainly made are:

  1. Wealth creation
  2. Health and fitness (e.g. weight loss)
  3. Self-development

These niches are always in demand. There are many affiliate offers available in these 3 niches. But these 3 niches are also very competitive so it is a good idea to look for other profitable niches. Use a combination of keyword research to assess demand and ways of proving that money is changing hands in the niche (are their affiliate offers available?).

Pay Per Click (PPC)

Visitor traffic from search engines such as Google and Bing is often seen as the best. This is because a specific search term (keyword) is entered by users to find what they want. As an affiliate, you can purchase PPC traffic from Google or Microsoft to drive targeted visitors to your offers.

PPC traffic used to be very cheap but over the years it has become a lot more expensive. Usually, traffic from Microsoft properties such as Bing and MSN is cheaper than Google PPC. You need to crunch the numbers here. Paid traffic is a great way to test conversions for offers as you can usually start to receive targeted visitors in minutes.

Return On Investment (ROI)

If you are spending money on your affiliate marketing campaigns you need to know what your return on investment is. Subtract all of your campaign costs from the net revenue that you receive (your commissions). This will quickly tell you if your campaigns are profitable and to what degree. You want to achieve as high an ROI as possible.

Search Engine Optimization (SEO)

The best visitor traffic for your affiliate offers is targeted traffic. This means that the visitor is interested in your niche or the specific product or service you are promoting. If you can rank your content high in major search engines such as Google and YouTube (for videos) then you can get a lot of free visitor traffic to your offers.

To have the best chance of high search engine rankings you need to optimize your content. You need to perform keyword research and make sure that the best keywords appear in your title, description, and content itself. SEO is a fairly complex subject and there are a lot of training courses available for this online.

Split Testing

Split testing, sometimes called A/B testing, is where you compare the performance of two or more ads for the same affiliate offer. You can perform split tests with paid traffic solutions from Google, YouTube, and other major providers. Use the different metrics provided to assess which ad is performing the best.

Tracking Links

A tracking link will tell you where you are getting your visitors from. You may be using several traffic sources for your affiliate campaigns and you need to know which is providing you with the best results.

Some affiliate networks will provide you with tracking links that you can use for this purpose. A lot of top affiliate marketers like to use external tracking services such as Click Magic as they provide a lot more information.

Two Tier Affiliate Programs

A two-tier affiliate program will pay you a commission for the sales that you make and also a percentage of the commissions that affiliates you have recruited make. The more affiliates that you recruit, the more money you are likely to earn.

Conclusion

You do not require any skills or experience to get started with affiliate marketing. It has a very low cost of entry and you can start making money very quickly. It requires dedication and commitment and you need to treat it like a serious business to get the best results.

There are many affiliate networks available that you can join for free. They have many affiliate offers available for you to promote. Some of these networks do not require any approval to promote their products so you can get started right away.

Although you can make money with affiliate marketing without any skills, we highly recommend that you invest in the right training so that you can achieve significant results. The Super Affiliate System from John Crestani is the best training program around.

We wish you every success with your affiliate marketing!

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