What is affiliate marketing and how can I use it to make a passive income

What is affiliate marketing and how can I use it to make a passive income

Affiliate Marketing is where companies such as Nike, Apple, Tesco etc partner with affiliates (websites, social media influencers or individuals) to promote products and services in exchange for a small % of a sale or fixed fee (commission). Sales are tracked via an exclusive URL or unique discount code which ensures those that purchase are tracked back to you (the affiliate).

Is it a good way of earning money?

It certainly can be but often you won’t be taken seriously (at least with the big boys) until you have a decent-sized following so it can be a long process before you’re earning money.

How would I use affiliate marketing to make money?

You can promote sales, products or services to your followers/users, when they sign up/purchase etc you would earn the commission.

Having a niche and promoting brands in a similar niche is likely the easiest way of earning money, for instance, if you had a blog discussing art you could promote a brand that sells art materials to your followers, if/when they click and went through to buy they would earn you a commission.

What commission am I likely to get?

That massively depends on the company you’re promoting but on average 1-6% is a normal commission structure (excluding delivery and VAT), this can go much higher though depending on the niche. Other sites will pay a fixed £ per lead/sale again this value will vary dramatically from a few pence to tens of pounds depending on the niche and level of commitment from the purchaser.

What are the different types of affiliate accounts? Which should I sign up to?

Direct affiliate approach:

The benefits: You retain full control and all of the commission
The negatives: You have to approach each company you’re interested in working with

Affiliate networks approach:

The benefits: You retain a decent chunk of control, most of the commission and less work involved than a direct partnership
The negatives: You have to manually request each advertisers approval and the affiliate network takes a commission

  • Awin (one of the biggest and best in the UK)
  • Webgains
  • TradeDoubler
  • Paid On Results

Auto affiliate networks approach:

The benefits: You get immediate access to a wide selection of approved advertisers
The negatives: You will share the profits on any sales you help generate with the company (often 30%) + the affiliate network

How long do payments normally take to arrive?

Normally 2-3 months after a sale has been made.

Is Google Ads not a better option?

It certainly is a more hands-off approach but often the ad revenue levels are much lower with Google Ads.

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Important things to remember with everything we post:

  • If you earn over your personal allowance (currently £12,570 a year) HMRC need to get their % cut (even if the money is in cash or from another country)
  • If you’re working for yourself / earning an income on the side you need to let HMRC know – There are numerous benefits but also some drawbacks
  • You need to always ensure whatever you’re doing is legal and not hurting anyone else – be careful and always think twice
  • Some income streams may require you to have DBS check, licence, insurance or qualifications before you can start to profit from it, do your research.
  • Be careful that any additional income doesn’t compromise your studies or main income/job
  • If you work for a company check your contract, if you don’t inform them you’re working on other side projects outside of work they may have grounds to ownership on this work

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