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What is affiliate marketing and how it benefits your business?

Operating a business and making profit is not easy. If you are a business owner, it is the biggest pressure you have to face everyday. And one of the most important things is choosing a good marketing strategy, even when you have really excellent products. Because no one would buy them until they could reach, see and feel these products are good. That is marketing’s duty. 

However, marketing is a costly activity if you do not use a right strategy. Today, businesses are more frequently seeing the benefits of affiliate marketing – a performance based marketing channel. It means you only pay the cost based on these actions such as completion of a lead form or converted sales, depending on which kind you choose. Looks interesting right? In this article, let’s analyze how it works and what are the advantages of this method to your brand and business. 

What is affiliate marketing?

Probably the question in your mind now is “What is affiliate marketing?”. Well, you are not the only one who is asking. With many customers we have worked with, this is the most popular confusion when they start learning about this marketing method. 

Definition of affiliate marketing

There were many definitions of affiliate marketing you could find on the Internet. But almost were definitions for Publisher. In affiliate marketing, you (brand/ business) called “Advertiser”, who have products or services and want to sell them online. To help you do it, affiliate platform (like Rentracks) have a Publisher network. It included hundreds thousands of good digital marketing skilled people. They are willing to promote and sell your products through their sites for a commission exchange. Affiliate platform has a tracking system to control and measure conversions in that process and Advertiser (you) will pay cost based on successful conversions.

Read more: Essential affiliate marketing terms you must know

How does affiliate marketing work?

There are 5 steps to finish an affiliate conversion.

Step 1: Publisher choose your products or services on your site and take their link

Step 2: They make them into affiliate links through Rentracks’s system (this link has tracking information to monitor later) and promote affiliate links on their channels with much content.

Step 3: Customers visit Publisher’s site, click to links and are redirected to your site.

Step 4: Customers purchase your products by finishing payment 

Step 5: You pay the commission based on successful conversions

How affiliate marketing benefits your brand?

So, are you wondering what the “new-style” of marketing can do for your business and why you should choose it? There are many reasons that nearly 80% of businesses around the world are using it for their strategy. We’re gonna show you right now.

Low cost of start-up

Yeah, you know, there are few big companies in total. Instead of that, there are millions of SMEs (small and medium businesses) which are accounting for 90%. So, cost is the big problem. No owner or director of SMEs wants to spend a lot of money for something, which they are not sure about its results. That’s why Affiliate Marketing is the good choice for these businesses. 

To start doing marketing with affiliate, you only need to pay a very small fee (called initialization fee) and then, only pay when you get the successful sales or conversions (called commission). Let’s compare with other marketing methods such as GG ads or FB ads, Native Ads. With these methods, you have to pay them based on view, click, which do not certainly become sales. Even pay so much at the beginning until you can see first results. And you might encounter this situation: much money spent and no sales received. With affiliate marketing, it never happens.

Performance based cost

As we explained in above paragraph, if you use affiliate marketing, only pay on the sales or the leads you receive. We call it “performance based”. And the “performance” is not only sales. We provide many kinds of performance depending on which type of business you are running. You can choose CPA, CPI, CPL, CPQL, CPS… etc (see the definitions of them here) and if you don’t know which one is the best for your business, we are willing to consult.

High ROI

Well, ROI (return on investment) is not only 3 simple characters, it is the most important thing that every business is concerning about. A business without ROI or low ROI is a nightmare to its owner, director. We can not live without profit. That’s why high ROI is the overall goal and we need a right marketing method to archive it. 

Affiliate marketing is providing a much higher ROI  than the majority of marketing methods. The first reason is it is the “performance based cost” (we explained above). And the second one is, affiliate marketing can reach the right audiences, who have a high chance to buy your products or services due to millions kinds of interesting content made by Publishers. 

Rapidly scale your sales

Ok, now we’ve had the sales, what’s next? Its “scale”. When you have sales, you need to make it bigger and higher. Affiliate marketing helps you to scale it up rapidly with the support from Publishers. If you used to use Ads, you would understand the scaling up is very difficult. For example, with 10 first sales, you could have the good cost, but next 100 or 1000 sales, you have to pay a much higher cost to reach it. With affiliate marketing, we have the fixed cost which dealt from the beginning. And by the abilities of skilled Publishers, they would help you to scale the sales up with best cost. 

Diversity traffic target

Sounds interesting, right? This is the last one we want to tell you about affiliate marketing. That is “diversity traffic target”. If other methods are limited by certain targets, affiliate marketing allows you to reach any target. And no worry about it because Publishers will do it for you. With many models of Publishers from review site, comparing site, personal blog, social channels, cash back… to KOLs, influencer, press and media…we cover all verticals. Your products could approach the target customers easily. 

I want to register as a Rentracks Advertiser, how to start?

To become a Rentracks Advertiser and start promoting your products, you can sign up here and our team would contact you to do next steps as soon as possible. 

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