What Is Affiliate Marketing — Guide for eCommerce Merchants

As SEO becomes tougher and ads become costlier, affiliate marketing is one of the best ways to reach a new audience.

Affiliate marketing enables online merchants to partner with bloggers, streamers, social media influencers, and more to sell products to their audience. And the partners, called affiliates, earn a commission every time someone buys from their recommendation.

While it’s not that simple, that’s the crux of it.

Thanks to its effectiveness, businesses are embracing affiliate marketing more dearly than ever before.

We know you have many questions in your mind, such as:

• Is this strategy effective?
• Are there any pitfalls to affiliate marketing?
• And, more importantly, how you’ll make it work for your online store?

That’s what we are exploring in this blog post.

By the end of this blog, you will know how to use affiliate marketing to grow your online business and revenue.

Let’s get started.

Understanding Affiliate Marketing

Before we get into the nuances of affiliate marketing, let’s understand its definition.

Definition—What Is Affiliate Marketing?

Affiliate marketing is a marketing method where businesses partner with third-party businesses and individuals, called affiliates, encouraging them to promote and recommend their products and services to their audiences.

Affiliates earn a commission for each sale, lead, or specific action generated through their promotional efforts.

Here, an affiliate acts as a digital salesperson who promotes the brand and its offerings without holding inventory or managing the order fulfillment process. Their primary role is to drive traffic to the brand’s website or product page, often by sharing reviews, tutorials, or recommendations with their audience.

Once the traffic is directed, the brand takes over, managing the rest of the customer journey.

This works best for both brands and people looking to earn money online.

Let’s get in more detail.

Who are the stakeholders in affiliate marketing?

In affiliate marketing, there are three stakeholders:

• The merchants: Businesses (like you) offering products and services.
• The affiliates: People promoting the products on blogs, social media, or YouTube channels.
• The consumers: People clicking the affiliate links and buying products and services.

How does the process work?

Affiliate marketing is pretty straightforward. Here is how it works.

1. A merchant provides an affiliate with a unique link to track sales.
2. The affiliate shares the product link with their audience, often recommending the product based on their experience.
3. When someone clicks the link and buys the product, the online store pays a percentage of the sale to the affiliate as a commission.

Who benefits from affiliate marketing?

Everyone involved in affiliate marketing benefits from the strategy in one way or another. Here’s an idea of how.

• Merchants: They boost sales without upfront advertising costs by paying affiliates with commissions on sales they generate.
• Affiliates: They make passive income by promoting products they believe in without managing stock or handling the order fulfillment process.
• Consumers: They discover new products through trusted sources, often with helpful reviews, tutorials, or exclusive offers.

This model works wonders in the eCommerce space by being a cost-effective and highly scalable marketing solution.

Let’s learn how.

What Is Affiliate Marketing for an eCommerce Store?

Affiliate marketing for an eCommerce store is a performance-based marketing strategy where the store (you) partners with affiliates—bloggers, influencers, or website owners—to promote your products.

In this process, affiliates share unique referral links/discount codes with their audience to direct traffic to your eCommerce store. When a customer makes a purchase through this link, the affiliate earns a commission, and you earn a sale.

This approach benefits both the eCommerce store (you) and affiliates.

Here, you (as a business) gain cost-effective marketing and increased sales without advertising costs, while affiliates earn commissions for each successful referral.

So yes, this strategy is best to bring in growth and revenue for your business.

Types of Affiliate Marketing Programs for Your eCommerce Store

Moving further in detail, let’s check on the types of affiliate marketing programs that you can consider for your eCommerce store.

Affiliate programs for eCommerce come in three main types, and each of them has its unique benefits; whether you aim at sales, traffic, or leads, you’ll find a fit for your needs.

Let’s get into the details. 

Types of Affiliate Marketing Programs:

1. Pay-per-sale: Here, the affiliate earns a commission when a customer completes a purchase using the affiliate’s link.
2. Pay-per-click: The affiliate earns a commission based on the number of clicks their links generate, regardless of whether the user makes a purchase.
3. Pay-per-lead: Affiliates are paid when users complete a specific action, such as signing up for a newsletter, filling out a form, or registering for a service.

Where do you promote your products using these programs? The answer is affiliate marketing channels. Let’s explore the most common channels next.

Common eCommerce Affiliate Marketing Channels

Affiliate marketing works on diverse channels, and each of these channels has unique strengths to help e-commerce stores drive sales.

Here are some of the top affiliate marketing channels you can rely on.

1. SMS marketing

Affiliates can use SMS to send product links, exclusive discounts, or limited-time deals directly to users’ phones.

2. Email marketing

Affiliates can use personalized email campaigns for a range of purposes. They can engage subscribers, share exclusive deals, and drive traffic to your store.

4. Influencer partnerships

Collaborating with influencers allows affiliates to promote your e-commerce products authentically.

5. Content marketing

They can write product reviews, create comparison guides, or publish how-to videos. And they can link back to your store and encourage sales.

6. Social media advertising

Social media platforms like Instagram, TikTok, and Facebook offer a lot of opportunities for affiliate marketing. Affiliates can share promotional posts or create stories with swipe-up links. Short-form video, in particular, is highly engaging and ideal for promoting your products. They can even run sponsored ads to sell your products.

7. Coupon and Deal Websites

Coupon sites attract consumers who are actively looking for savings. Affiliates working through these platforms promote your store’s discounts or special offers. Shoppers are more likely to make a purchase when they feel they’re getting a bargain.

8. Video platforms

YouTube and other video platforms allow affiliates to create detailed product reviews or tutorials. Video content is engaging and helps users visualize the product in action. Your affiliates can include links in the video description or within the video.

9. Forums and Communities

Forums like Reddit and niche communities offer a targeted approach for affiliate marketers. Affiliates can participate in discussions, answer questions, and subtly recommend your products where relevant.

However, authenticity is crucial here, as constant promotion with no value to the users won’t always work.

;

By using these channels, you can connect with diverse audiences to maximize your affiliate program’s reach. And in doing so, you can drive sustainable growth.

But are there any benefits to all these efforts? Yes, of course, check out some of the crucial benefits of affiliate marketing next.

Benefits of Affiliate Marketing for Your eCommerce Store

As an eCommerce business, you stand to gain a lot with an affiliate marketing program.

It can help you drive growth, get traffic, and build a community of customers, which has made it a go-to strategy for e-commerce stores to grow. This is also why affiliate marketing is estimated to be worth USD 36.9 billion by the end of 2030, as reported by Astute Analytica.

Let’s dive into the key benefits that make affiliate marketing vital for your store.

1. It has low upfront costs.

Cost-effectiveness is the biggest advantage of affiliate marketing for e-commerce stores. You don’t need to spend upfront on campaigns that may or may not work. This is different from traditional advertising where you must pay no matter what.

2. It helps expand your reach.

Affiliate marketing opens doors to audiences you may not have reached otherwise, as the affiliates operate in varied spaces. They may have niche blogs or social media communities with loyal followers.

3. It enhances brand credibility.

Trust is a vital element of affiliate marketing. Most of the time, affiliates are seen as experts in their niche. Hence, their followers tend to take their recommendations at great value.

This added credibility can significantly influence purchasing decisions, especially in competitive markets.

4. It offers a high return on investment (ROI).

Affiliate marketing focuses on performance. Hence, it naturally delivers a better return on investment.

By associating with affiliates, you are not spending blindly. Instead, you are strategically investing in what works. These affiliates are also motivated to generate results as their earnings depend on it.

5. It ensures scalable growth.

The flexibility of affiliate marketing makes it ideal for businesses of any size. As your e-commerce store grows, you can easily scale your affiliate program.

Adding new affiliates or entering new markets doesn’t need significant resources.

6. It lets you use diverse channels.

Marketing works best when you go to places where people are.

While ads allow you to do that, it often comes with upfront costs. While that’s fine, it does not guarantee you results. Affiliate marketing takes this uncertainty away from your marketing.

7. It brings you highly targeted traffic.

The biggest challenge most online businesses face is the lack of qualified leads.

Even with ads, the traffic may not be good. However, affiliate marketing ensures that you get to your target audience. This means the traffic they send to your eCommerce store is highly targeted. The precision leads to better conversion rates and higher sales.

;

Seeing all the benefits of affiliate marketing, you might want to launch an affiliate program for your eCommerce store as well.

In the next section, we’ll share in-depth ideas on that only. Let’s get to it.

How Do I Launch a High Converting eCommerce Affiliate Program?

Launching an affiliate program that delivers results requires more than just a quick setup.

You need a strategic plan that aligns with your business goals. Here are actionable steps you can follow to build a successful affiliate marketing program for your eCommerce store.

Step #1 — Know your audience inside and out

Understanding who your audience is the first step in starting your affiliate marketing program. While it might seem like a challenge to identify them, a disciplined approach can help.

Ask yourself these questions that will lead to creating your ideal customer persona:

    —Who are my ideal customers?

    —What do they care about?

    —What problems are they looking to solve?

    —Where are they more active?

Note the answers to these questions. It will help you understand who the target audience really is.

Once you know who they are, figure out where they spend their time online.

    —Are they scrolling through Instagram or engaging in Facebook groups?

    —Are they watching YouTube tutorials?

    —Are they reading blogs and articles to make decisions?

While this might be a bit more challenging, there are tools to help you. You can use SEO tools such as Semrush, Ahref, etc., to learn more about these audiences.

Here is how to use the Market Explorer feature in Semrush to understand the audience behavior of Ebay’s customers. You can do the same for your customers or a direct competitor to get unique insights into their interests.

Credit: Semrush

Mapping out your audience’s online habits helps you align your affiliate program to their needs. It also helps you choose the most suitable affiliates who can influence these audiences.

For example, imagine your target audience spends their time on TikTok the most. In this case, choosing an influencer from TikTok to be your affiliate makes sense for your brand.

Hence, understanding your audience will affect a variety of your decisions like this.

Step #2 — Choose your affiliate program model

Once you’ve found the audience to serve and the influencers you want to work with, you are up for the next step.

Here, your goal is to choose the most suitable affiliate program for you.

When looking for an affiliate program model, look at your objective. It will tell you the best affiliate program model to go with.

• If you aim for sales, a pay-per-sale model is ideal. Here, your affiliates earn a commission for every successful sale. This keeps the program results-driven.
• If you aim for traffic, a pay-per-click works the best. Here, you can pay the affiliates for every user they send, regardless of whether they buy or not.
• If you aim for leads, a pay-per-lead model works best. It rewards affiliates for actions like sign-ups or form submissions.

While each model has its benefits, the choice often depends on what you aim at. So, choose the right one.

Step #3 — Create an affiliate program offer

Like the famous dialogs in the world of cinema in the movie ‘The Godfather,’ create an offer that your affiliates cannot refuse.

What we are trying to say is you must create a program offer that must stand out and attract the right affiliates. Also, several elements go into creating a unique and impressive affiliate program offer.

Here, I’ve outlined a few of them to help you create an excellent offer.

1. Research your competitors

Looking at what your competitors are doing is a great way to start. It will tell you what’s working and what’s not in the industry for affiliate marketing.

2. Analyze the industry rates.

This is another way to get more context into your program offering. Without knowing the standard or trends of affiliate commission, you may end up offering too high or too low. A high commission brings your profits down, and a low commission may discourage influencers from joining your program.

Hence, find a sweet spot that works for all.

3. Make tracking easy.

Affiliates want to see their performance in real-time. So, make sure you provide them with tools to track clicks, sales, and commissions. This transparency builds trust and encourages active participation.

4. Affiliate-friendly cookie expiration.

Set a decent cookie expiry date. Cookies that expire quickly may discourage affiliates from joining your affiliate marketing program. A longer cookie life can help affiliates earn more commission and encourage them to become part of your program.

5. Offer ample marketing materials.

This is something most important that many online stores forget about – suitable marketing materials. To help your affiliates sell your products, you need to provide them with great banners, social media posts, and product descriptions. This makes it easier for them to promote your products and bring in sales.

6. Clear terms and conditions.

This is another vital aspect of creating an irresistible affiliate marketing program offer. You must define your expectations, prohibited practices, and commission structures. And it must be communicated in detail in a written document.

A well-structured offer attracts top-tier affiliates and helps set the path to building a long-term partnership.

Step #4 — Build a web page for your affiliate program

Next up, in the process, you need to build a web page for your affiliate program. This page is the landing page for your affiliate marketing program.

It is where the interested influencers will come, understand your offerings, and show their interest in your program. Hence, you need to make it as detailed and catchy as possible because you need affiliates to join your program just as you need buyers for your products.

Here are some of the key aspects of building a web page for your affiliate program:

• Use a clean layout, eye-catching visuals, and easy navigation for better UX.
• Include the critical details, such as commission rates, benefits, tracking tools, etc.
• Have a dedicated FAQ section to answer questions that affiliates may have.
• Use clear, engaging language that explains why your program is worth joining.
• Add a prominent call-to-action button, inviting users to join the program.

Affiliate marketing is a great way to sell and earn more. Hence, work on your web page diligently and try to convince the affiliates through the page.

Step #5 — Attract influencers to join your program

Finding the right affiliates to join your affiliate program is challenging but not impossible. More than quantity, you need quality. By that, we mean you need affiliates that can send you traffic that will buy from you.

Having five affiliates who send you 50 sales a week is way better than having 50 affiliates that generate no profit.

Here are two best ways you find the best affiliates for your program.

1. Use affiliate marketing networks

Networks like ShareASale, Rakuten, ClickBank, or Commission Junction are a great place to start. You can create an account with these platforms and share your program there. These platforms connect you with a vast pool of potential affiliates.

Using these tools will save you time on recruitment and bring you closer to affiliates looking for top offers.

You can also find niche-specific affiliates in the field as well on these networks.

2. Direct outreach to find affiliates

This is another effective strategy to find affiliates that align with your offerings. You can look for influencers, bloggers, and content creators who are in your niche and pitch them to join your program, showing them the benefits and growth opportunities.

You can show competitive commissions, exclusive perks, or collaborative opportunities you offer. The goal is to attract affiliates who not only drive traffic but also enhance your brand’s reputation.

So, make sure you focus on building long-term relationships that mutually benefit both sides.

Step #6 — Track, analyze, and optimize for success

Don’t think your work is over once your program is live. At this point, things are just getting started, and your work is far from over.

In fact, the next steps are the most vital step to keep your program growing for good.

So yes, at this stage, you need to monitor performance to achieve long-term success.

For that, you’ll need to invest in reliable affiliate tracking software to measure clicks, conversions, and sales. Later, you can use this data to identify what’s working and pinpoint areas for improvement.

In the process, if you find some affiliates struggling, make sure you assist them well through direct communication.

Moreover, don’t forget to reward top-performing affiliates to encourage them for continued growth.

# Bonus tip

Promote your affiliate program through every channel possible. Share it on your website, social media, and email campaigns. Partner with industry publications to expand visibility. Offering bonuses or early-bird incentives for sign-ups creates urgency and excitement.

A well-promoted program attracts high-quality affiliates quickly. This gives you a strong start and sets the stage for sustained growth.

But are there any challenges to affiliate marketing? Yes, there are. And let’s explore them with a table.

Pros & Cons of Affiliate Marketing for Your eCommerce Store

Affiliate marketing offers an innovative way for eCommerce stores to grow, but it’s not without challenges.

Here are a few essential pros and cons to help you decide.

Pros	Cons
Low cost, high ROI	Time-intensive Management
Better reach to the audience	Reduced profit margins from commissions
Scalable and flexible approach to reach the target audience	Reputation might be at risk with unfit affiliates
Performance-based payouts	Dependency on affiliates
Increases customer trust in your brand

Top eCommerce Affiliate Programs to Inspire You

In this section, we’ll study some of the most successful eCommerce affiliate programs. Understanding their strategy will help you build an affiliate program that works in your favor of bringing in more sales.

We’ll also discuss the good and cons of these affiliate programs so you can understand how every small thing impacts.

Let’s start.

#1: Amazon Associates

Credit: Amazon

Amazon Associates is trusted by over 900,000 affiliates across the world. It is also perhaps the most recognizable affiliate program in the world. Affiliates earn commissions with Amazon Associates by promoting Amazon products through custom links. They can choose from an extensive array of products belonging to diverse niches.

The program offers diverse commission rates from 1%-10% depending on product category. Amazon Associates pays the highest commission on clothes and luxury beauty products. The fact that Amazon has a high conversion rate also makes the program attractive.

One unique element that works in favor of Amazon Associates is brand recognition. The world already knows the brand and trusts them. It makes selling products easier.

Pros:

1. Reliable and timely payouts.
2. Vast product catalog for diverse niches.
3. Simple setup with custom link creation tools.
4. Broad global reach attracts affiliates worldwide.
5. High brand trust increases affiliate conversions.

Cons:

1. Low commission rates (1-10%)
2. Short cookie duration (24 hours)

Over the years, Amazon’s scale and simplicity helped it become a top brand in the affiliate landscape. Hence, you can assess the unique features of their program to model yours after it.

#2: Sephora affiliate program

Credit: Sephora

Sephora’s affiliate program is the prime example of niching your offerings well. By focusing on serving an affluent market, Sephora sells luxury beauty, skincare, make-up, and fragrance products. This is an excellent lesson for anyone wanting to build an affiliate marketing program. They know their audience well and it is visible in the affiliate program. Another highlight that works for them is their focus on customer experience. Sephora offers free gifts with every sale and an impressive reward program.

At 5%, Sephora’s commission rate may not feel very flattering. But, considering the price range of their products, the commission is excellent. Another unique element of Sephora’s program is the marketing materials. They have high-quality promotional banners and creative assets to help affiliates drive traffic.

An area where Sephora’s program lacks is the length of the cookie. After 24 hours, it expires, which is not flattering for most affiliates.

Pros:

1. Attractive 5% commission rate.
2. Access to high-end beauty brands and products.
3. Professional marketing assets provided to affiliates.
4. Superior customer rewards programs drive sales.
5. High trust among beauty shoppers.

Cons:

1. Short cookie life (24 hours).
2. Minimum $50 payout threshold.
3. Limited to beauty-related niches.

Sephora’s focus on customer experience is a unique element to pick up on for your store as well. It will help you keep the customers and encourage them to come back.

#3: Hammacher Schlemmer

Credit: Hammacher Schlemmer

Hammacher Schlemmer is one of the most unique affiliate programs out there in the market. It has an extensive catalog of products, such as outdoor gear, electronics, personal care, apparel, and more. This unique blend of products makes it an ideal program for affiliates looking to grow. The commission they offer is 8%, and it may not sound much.

However, with products costing from $5,000 and $65,000, the payout is pretty good.

They also take good care of their affiliates. They offer all the promotional materials and content the affiliates need to promote the products. These materials target diverse audiences. Affiliates also receive support from a dedicated team, ensuring smooth collaboration.

Hammacher Schlemmer also has a range of reports to help affiliates understand what products perform better and don’t.

Pros:

1. High 8% commission rate.
2. Wide range of niche products.
3. Strong support team for affiliates.
4. Unique products attract curious customers.
5. Competitive edge in promoting innovative items.

Cons:

1. Less recognizable brand compared to competitors.
2. Limited audience appeal due to niche products.

Hammacher Schlemmer’s program highlights the power of a unique product offering. For businesses that target specialty markets, taking a few cues from Hammacher Schlemmer will surely help.

FAQ — Affiliate Marketing for eCommerce

1. What are the challenges of affiliate marketing for eCommerce?

Affiliate marketing in eCommerce includes multiple challenges, such as finding the right affiliates, ensuring compliance with guidelines, managing low-quality traffic, and dealing with complex tracking and attribution can be tricky, as it’s important to accurately assign sales to the right affiliate.

On top of that, managing the program itself can take up a lot of time and effort.

2. How do I find the right affiliates for my program?

Identifying the right affiliates for your program can be tricky. Create a strategy to find the most suitable affiliates for your products and services. One of the best things to do is to use affiliate networks or directly reach out to influencers, bloggers, and niche websites. While doing so, it is vital to focus on affiliates that have a proven track record of driving engagement.

3. What commission rates should I offer affiliates?

The commission rates you must offer often change based on the niche and the performance of the affiliates. It is typical of a business to pay an affiliate more than the standard commission if they bring in a lot of sales. However, as per the industry standard, typical rates range between 5–20%. Higher commissions attract quality affiliates but may reduce margins.

4. What kind of marketing materials should I provide to affiliates?

You must provide all the marketing materials that your affiliate needs to sell your products and services. It can include professional banners, product descriptions, and email templates. High-quality visuals and ready-to-use content make promotion easier. While providing these materials, ensure they are tailored to various channels like social media or blogs.

5. How can I prevent affiliate fraud?

You can prevent affiliate fraud by using affiliate tracking software to monitor activities closely. Along with that, you need to also set clear terms to prohibit unethical practices like cookie stuffing. It is also important to regularly review performance data and check for unusual patterns to avoid fraud.

6. How often should I analyze the data from my affiliate program?

Analyzing the data from your affiliate program depends on your marketing strategy. However, typically, we advise you to review data weekly or monthly to spot trends and optimize campaigns. You can adjust your affiliate marketing efforts and strategies with the help of frequent analysis and improve underperforming areas.

7. Is affiliate marketing legit?

Yes, affiliate marketing is legit. It is a unique way of using people with audiences to promote your products and services for a commission for sales. 

So, Is Affiliate Marketing Worthy For Your eCommerce Store?

Yes, affiliate marketing is a legitimate and effective strategy.

If used strategically, it can help your business in diverse ways. From low-cost promotion to better reach and scalable growth, the benefits of affiliate marketing are endless. These benefits make it a powerful tool for boosting sales and customer engagement.

But yes, it’s not a set-it-and-forget-it solution.

Affiliate marketing success requires effort, precise planning, and ongoing optimization. If you are looking to grow your online store using affiliate marketing, it’s definitely a smart move.

PS:

We, Aureate Labs, are a web development agency.

Over the years, we have helped numerous businesses take their offers online and grow. If you are looking to create an affiliate program for your business, our eCommerce experts can help you develop tailored landing pages for your program.

We can also create a custom affiliate marketing tool for your business so that you don’t need to rely on third-party tools and take full control of your marketing and customer data.

Contact our experts and get a free consultation to fuel more affiliate marketing ideas.