By Nikki Carlson, co-founder/co-president of ChicExecs Retail and Strategy Firm. She has over 21 years experience in PR/marketing.
Do you have a limited marketing budget? Marketing is an essential way to grow your business, but you have to manage your costs wisely. If you aren’t careful, you can easily put your budget in jeopardy with pricey strategies.
In my experience, affiliate marketing is hands-down the most affordable and effective way to grow your business because you’re only paying for results. Combined with your PR and social media marketing strategies, affiliate marketing is just what you need to put a successful campaign together.
Let’s look at how affiliate marketing works and the five reasons why it’s still a good way to grow your biz in 2022.
How Does Affiliate Marketing Work?
Affiliate marketing is a monetization model where other people (called “affiliates”) persuade their audience to buy your products. As the brand, you provide each affiliate with a unique URL or promotional code.
The affiliate will promote your products via review sites, YouTube, blogs, courses, events and more to increase your reach. Every time a customer buys something with the affiliate’s code or link, you make a sale and the affiliate earns a commission.
Most brands offer a percentage of the total sale to the affiliate as commission. Average commission rates range from 5% to 30%, so the brand still takes home the majority of the sale.
Thanks to this unique structure, affiliate marketing is a win for everyone: Customers find products they love, affiliates earn a commission and you make more sales.
Five Reasons To Do Affiliate Campaigns In 2022
Affiliate marketing might sound complicated, but it’s a really simple, low-cost way to sell more products. Sure, affiliate marketing has been around for years, but that doesn’t make it any less potent.
1. Low Cost: Tactics like paid ads require hundreds of dollars up front, and there’s no guarantee that you’ll earn a dime. Affiliate marketing, on the other hand, doesn’t have any startup fees. All you need is an in-demand product, a group of interested affiliates with an engaged audience and a decent commission to incentivize your affiliates. That’s it! You only pay your affiliates when they make a sale. And since the affiliates take their commission right off the top, it won’t hurt your bank account nearly as much as other marketing tactics.
2. Low Risk: Affiliate marketing puts the hard work onto your affiliates, which gives brands more peace of mind. With affiliate marketing, you only pay when you make a sale, which means you’re essentially self-funding your own marketing. So, if you have an affiliate that doesn’t make a single sale, you don’t owe them a dime.
3. Greater Reach: The more affiliates in your network, the greater your potential reach. If you choose your affiliates wisely, they can significantly expand your reach into new audiences. In fact, affiliate marketing can give you a global footprint, putting your brand in front of thousands of new shoppers for less effort.
4. Scalability: Guess what? You can add more affiliates to your program as needed. Since you only pay affiliates a commission on every sale, it’s easy to scale up without hurting your marketing budget.
5. Easily Track Metrics: With some PR and marketing strategies, it’s hard to nail down your exact ROI. Fortunately, affiliate marketing is one of the most trackable ways to market your business. Every affiliate has a unique code or URL. This means you’ll know exactly which affiliates are getting you results. See who your most profitable affiliates are and reward them for their hard work! It isn’t uncommon for brands to give high-performing affiliates better terms, like higher commissions, in exchange for making a certain amount of sales.
The Bottom Line
Affiliate marketing might not be a new strategy, but that doesn’t make it any less effective. If you have a product-based business, affiliate marketing is a no-brainer in 2022. Get more ROI, save time and open up more PR opportunities with a solid affiliate marketing strategy.