An affiliate is basically someone who promotes somone else’s product, and it somebody purchases, the affiliate earns a commission. This can vary between a lowly 5% ~ 10% for some large brands up to 50% ~ 100% for some digtally based product.
If you’re wondering why somebody would give away 100% of the product they’re selling, it could be for two reasons. The first is that it’s a “hook”; people buy the first product – for which the affiliate gets paid – and then the vendor offers a second product for which the affiliate earns a smaller commission.
Another reason is the “Lifetime Value” of a customer. If they buy the first product and like it, there is a chance they will order again some time in the future.
Most vendors however stick with the basic commission arrangement, paying you x% per sale.
There is another affiliate “variant” called “CPA“, or ‘Cost Per Action’ This can offer higher commission amounts per sale. For example, send someone to an insurance broker, and if the customer takes out an insurance policy, you earn a flat $100 fee. Some betting companies use the same method, based on the “Lifetime Value” of the customer, (in this case how much they could lose over the next few months) they might pay you $250+ for each customer you send them.
The main difference is that with CPA, the customer doesn’t have to purchase anything, (at least not initially) As long as the vendor has their email address, they will pay you the commission.
Now before you get too excited, it is VERY DIFFICULT to get accepted into CPA networks. You have to be able to send them lots of potential customers who are in a position to purchase the product. And to establish that, you have to prove that you site has made lots of sales in the past, and has thousands of visitiors each month.
Thankfully, it’s much easier to get accepted as an affiliate on smaller ecommerce sites, such as JVZoo, Clickbank, Warrior+ to name a few … plus ATOMZ, where you are automatically approved to promote any product.