Are you trying to find the right affiliate marketing business model that will work for you?
In this blog post, I will go through 6 different affiliate models, including their benefits and challenges, so you can get a clearer idea of what model you identify with.
Affiliate Marketing Business Model Examples
Affiliate marketing is the business model where an affiliate earns a commission from selling another person’s or company’s products (physical or/and digital).
Although most affiliates share common practices to ensure that their audience is engaged and receptive to purchasing promoted products, not all affiliates advertise their offers in the same way.
In fact, there are several different marketing channels they may leverage.
Here are different affiliate marketing models you can implement to establish your affiliate marketing business:
1. The Influencer Model
An influencer is an individual who is able to impact the purchasing decisions of others.
The level of “influence” has to do with the authority, knowledge, position, or relationship that the person (influencer) has with his or her audience.
Depending on the size of their audience, an influencer can hold the attention of a large segment of people.
Out of all the different types of affiliate marketing, the influencer is a fairly new model.
Consumers not only prefer recommendations by their peers but also dream of getting closer to the people they admire – whether that’s achieving a goal or changing lifestyle.
So, how does the influencer model work?
Influencers may leverage different channels to promote to their audience:
- Blog (known as bloggers).
- Podcast (podcasters).
- Youtube (YouTubers or vloggers).
- Instagram (Instagrammers or social media influencers).
- Facebook.
- Pinterest.
They will promote a product using one or multiple of the channels above and make a commission when their followers make a purchase through their affiliate links.
Influencer Pros
- Higher commissions: Some influencers tend to get a better commission rate because they are able to deliver a big batch of sales in a short period of time.
- High-value marketing: Communication and marketing to the audience can happen in a more natural and relatable way in comparison to traditional advertising.
- Affiliate marketing without a blog or website: This affiliate model allows you to promote offers without the need of having a website or writing a blog.
Influencer Cons
- Need to stay relevant: Keep up to date with new products and trends.
- Recommendations can have a backlash: If a portion of your audience didn’t like a product you recommended, you will probably lose some followers, and get criticized.
2. The Blogger Model
A blog is a website with a list of readable content, i.e., blog posts.
When starting a blog, you focus on a particular topic, area of interest or niche, with the goal of solving a problem and educating the intended audience.
Blogging is one way of producing high-quality content to share with your audience and prospective consumers.
Blog posts can take on just about any form, from product reviews to guides and tutorials.
As a blogger, you are able to monetize your blog by recommending relevant affiliate products in your posts.
For example, my article on essential email marketing tools includes product reviews and affiliate links promoting resources to my audience.
Blogging Pros
- Organic traffic: You can rank organically (so-called “Free” traffic) on search engines like Google without using paid traffic.
Blogging Cons
- SEO knowledge: Necessary for keyword research and blog post optimization to rank on search engines.
- Copywriting skills: For writing persuasive content that converts traffic into customers.
- Results are not immediate: Ranking can take time. Also, it takes a while to build up income on a blog. Some blogs can take two years or more to build up revenue that is equivalent to your current salary.
3. The Vlogger Model
A video blog or video log (known as a vlog) is a form of blogging, but the content is video.
Like blog posts, videos are a great way to deliver high-quality content to your audience.
Product demonstrations, tutorials, and product reviews are three popular formats that are also highly effective for affiliate marketing.
There are two main ways to embed affiliate links into your video content.
- Include your affiliate links in the video description. But, make sure to verbally and visually call out the description in your video. Most YouTubers use phrases such as “Click on the links in the description below” to direct viewers to the right place.
- Use YouTube annotations. These are the transparent boxes that pop up at preselected times and places within a YouTube video, often with a call-to-action. Each box is hyperlinked, which makes it a great placement for your affiliate links.
Note: For the best results, you can use both tactics if relevant.
Vlogging Pros
- Very engaging: Video is a very effective format to keep your audience engaged.
- No hosting needed: You can upload your video for free to YouTube.
Vlogging Cons
- Equipment cost & setup: Although you can start recording yourself by using your phone, down the line you will need to invest in a camera, a mic and some lighting to improve the quality of your content.
- Video editing skills: You may start off with basic editing, but when you start producing tons of video, you will need video editing software or even a video editor!
4. The Niche Site Model
Niche sites, microsites or niche blogs are all the same. A niche-focused model is centred around a particular niche market.
The key element is “niche.” This term means a specialized segment of the market.
In a nutshell, you are building a website or blog for a particular interest group where your content is curated towards.
As an affiliate marketer, you will be making money by providing or promoting a solution that speaks to your particular audience.
Niche Site Pros
- Easy to get started: All you really need is a website (WordPress is the easiest solution, and it’s free) and knowing which niche market to tackle.
- Organic traffic: You have the chance to rank organically on search engines like Google without using paid traffic, as your content can be specific but still attract a large audience.
Niche Site Cons
- Research skills: You don’t need to be an expert in your niche, but you do need to know how to research content and keywords to create high-quality content.
- SEO skills: To increases the visibility of your website on search engines through organic searches. Although it won’t bring you results right away, good SEO delivers long-term benefits that are invaluable to your business.
- Volatile traffic: Website traffic can be extremely volatile with this model (search volume, seasonality, etc.). Traffic is essential for a website and if you don’t have any traffic, then you don’t get any sales.
5. The Large Website Model
This is the opposite of a niche site.
The goal of a large website model is to generate a huge amount of traffic at all times. These sites focus on building an audience of millions.
An affiliate website can be:
- Authority site: A known reference in the field, regardless of how wide the topics they cover. Basically, a big and well-respected website.
- Pro blogger site: An affiliate blog with a specific person behind it.
These websites promote products to their massive audience through the use of banners and contextual affiliate links.
However, their monetization also includes ads and they implement some sort of opt-in to capture their readers’ emails, so they can continue marketing to them using email marketing.
Affiliate Website Pros
- Passive income: Your website can generate income when you are not actively working on it.
Affiliate Website Cons
- Organic traffic takes time: It takes time to start getting traffic to your website especially since you are relying on organic search traffic from search engines like Google or Bing.
- Affiliate offers up-to-date: It can challenging keeping product links current and up-to-date.
6. The Sales Funnel Model
This method uses landing pages as the front end to a sales funnel that promotes one specific offer.
Affiliate sales funnels rely on paid advertising to drive traffic to the landing pages.
Also, capturing your viewer’s email is a must if you want to (re)market to them via email later on, especially since using email marketing is where you will get higher conversions and make most of your money.
Affiliate Sales Funnel Pros
- Small set up: You don’t have to produce blog post regularly. Instead, you can start by setting up one sales funnel (which you can split test to optimize for better results). For instance, one affiliate offer and one landing page.
Affiliate Sales Funnel Cons
- Paid traffic: This model relies on paid traffic like running Facebook ads and it’s expensive to advertise. You may need to spend at least $100 on ads just to test a sales funnel.
- Copywriting skills: Your writing skills are key for your ad and landing page copy. Otherwise, you won’t be able to convert prospects into clients or customers.
- Advertising skills: Have the knowledge to run ads on the platform you decide to work with (Facebook, Google, LinkedIn, etc.). Plus, expect some trial and error until you figure out what works.
Summary
Now that you know what the different models are, which model is right for you?
Start by deciding on what market you want to focus on, which products you want to promote, and how you go about promoting them.
The model you feel most naturally drawn to is likely your best starting point. Do your research to discover the opportunities in the affiliate marketing industry space that you are interested in.
Also, as with any business, there is no escaping competition and you need to keep up-to-date. Even more so with an online business, as things change quickly.
For instance, search engines and social media networks constantly change their algorithms. This means that there’s a possibility that you could lose a big part of your traffic and income if you are not prepared.
What’s next?
Affiliate Marketing for Beginners – How to Start in 7 Steps blog post.