Starting your own company can provide you with a huge range of new opportunities. You’ll be able to develop your own company strategy, choose your own hours and open up all sorts of new and lucrative income streams. But just like any other business, you might experience the occasional downturn or sales slump.
It happens to most companies, and so it’s nothing to worry about – chances are business will pick up again for you sooner rather than later. That being said, you still have plenty of overheads and you’ll be expected to continue paying the bills, no matter how much money is the company bank account. That’s when it comes in handy to have a steady source of passive income to help keep your company afloat.
And when it comes to passive income, nothing is quite so simple and lucrative as affiliate marketing. But what exactly is affiliate marketing? More important still, how can your company be using it to make extra money?
This guide will explain everything you need to know about affiliate marketing – including five of the top affiliate networks your company can join to start generating passive income.10 things you need to do before building a business website
What is affiliate marketing?
If affiliate marketing is a new term to you, don’t panic. It’s essentially just a fancy way to describe a revenue-sharing agreement that sees one company pay a commission to another company or individual, in exchange for referred business. Affiliate marketing has been around for centuries – but recent digital innovations have been rapidly transforming the practice into a highly automated and super-efficient industry.
There are three main types of digital affiliate marketing your company may want to consider exploring, and they all revolve around better use of space and content on your own company website.
The most popular affiliate marketing method is pay-per-click (PPC). Using this method of affiliate marketing, a company will generally pay a small commission to a registered partner (or affiliate) for each visitor that clicks through to their website. The PPC affiliate model is a particularly popular choice for companies who would like to make a bit of extra income without posting overt advertisements on their sites.
When it comes to joining an affiliate network, PPC will normally generate you the highest commission levels. That’s because as part of a PPC agreement, companies will have to pay you for each click a user makes. It doesn’t matter whether that user goes on to buy anything – and because you’re likely to generate higher levels of commissions this way, PPC commission rates tend to be lower.
Another popular method of online affiliate marketing is pay-per-lead. This method sees companies offer a commission based on the number of legitimate leads you can generate. That usually means a user will need to perform a predefined action or objective before you can collect your commission. This could include a product download, trial offer, newsletter registration or social media followers.
The third most common affiliate marketing method is pay-per-scale. This structure sees a commission given for each referred user that goes on to buy a product or service from the company you’re promoting. Pay-per-scale commissions are typically far higher, and you can generate a lot more income this way – but those referrals are understandably more difficult to generate.
It’s worth pointing out there are other affiliate marketing methods out there. Likewise, you don’t always have to be the one promoting other companies on your website. It’s possible to create your own affiliate network and set up various agreements with other websites for the purpose of sending you referrals instead.
But let’s take one step at a time. Before you run off and start building an affiliate marketing empire, let’s walk through how you can get started with an existing affiliate network and build a steady stream of passive income for your company.
How can my company use affiliate marketing?
The affiliate marketing sector has exploded dramatically in size over the past couple of years, and there are literally thousands of legitimate networks available that you can apply to join. A huge range of multinational companies run their own programmes, and the rewards and commission levels vary drastically based on the type of model and business you’re able to refer.
But if you’re just getting started as a business, here are five of the web’s simplest, most tasteful and most reliable affiliate programmes available:Why your company should advertise on Facebook (and how to do it)
1. Shopify Affiliate Program
Even if you aren’t already using Shopify for your own company website, chances are you’ve heard of it. Shopify is one of the web’s top e-commerce platforms, supporting more than 600,000 businesses across the globe to buy and sell goods online. By promoting their services via the Shopify Affiliate Program, you can gain a respectable income stream without actually doing any work.
When you sign up for the Shopify Affiliate Program, you will receive a unique affiliate referral link to the Shopify website. You are then free to promote this link to your company’s existing client base or followers via your website, social media, courses, blogs or any other way you can think of. Then, for each user who clicks on that link and signs up for Shopify, your company earns 200% of their subscription fee. Depending on the type of Shopify plan your leads end up choosing, you could end up making $2,000 on just one click – although if your lead ends up picking Shopify’s basic plan, you’re only looking at an average of $58 per referral.
To apply for the Shopify Affiliate Program, all you need to do is go to the Shopify website and fill out a few details about you and your business. The company will then review your application – and if you’re accepted, you can start pushing users to the Shopify site immediately. Payments are made periodically to your company via PayPal, and although payment is made in US dollars, your company can be based anywhere in the world.
2. Google AdSense
Google AdSense is the web’s most popular affiliate marketing programme. More than two million people are already using AdSense, and it’s one of the quickest and easiest affiliate networks to join.
To sign up, all you need to do is tell Google a little bit about you, your company and the website you’re introducing to the network. You then get to select the types of ads you are willing to display on your website. Options include text-only adverts, display ads, link units or a combination.
Based on the information and preferences you input into Google, you’ll then be given a bespoke piece of code. All you’ve got to do is copy and paste that code onto the pages of your website in which you’d like ads to appear. This is perfect for companies who would like to generate a small amount of extra income via AdSense, but don’t want to place ads for other companies in prominent places on their own website.
If you’re wary about HTML code, don’t worry. There are plenty of guides online explaining where you should be pasting your AdSense code.
From there, all you’ve got to do is ensure Google has your bank details to deposit the money you make on each referral. Google handles the process of billing advertisers and networks, and the platform ensures you are paid every time an advert on your website is seen or clicked.
It’s worth noting you must accrue a minimum amount of referrals before Google send you a payment.
3. Amazon Associates
Similar to AdSense, Amazon Associates is an incredibly powerful network your company could be leveraging to tap into the site’s colossal revenue stream.
Amazon Associates is free to join, and allows you to choose from over a million products you can advertise to your customers. This can actually be a win-win scenario, because you are permitted to choose all of the goods available on Amazon that naturally complement – but do not compete with – whatever it is your company sells.
For example, if you own a plumbing business, you could opt to promote Amazon’s selection of kitchen sinks or bathtubs on your website. That could ultimately not only earn you a commission if a customer clicks through to the Amazon website – but if they decide to buy a sink on Amazon, they could also end up commissioning your plumbing business to install it.
Just like AdSense, Amazon Associates enables you to fill out your preferences before creating a custom code for you, to cut and paste on your own website. If your company website is hosted on WordPress, you can download the Amazon Associates Link Builder WordPress Plug-In. This will help you integrate Amazon products of your choosing into your WordPress site in just a few clicks.
From there, all you need to do is sit back, relax and enjoy your new income stream.
That being said, Amazon has a dynamic management tool for you to manage your account. The SiteStripe toolbar enables you to easily add new links to your site, automatically post on company social media accounts and view your earnings summary.
As an Amazon Associate, you can normally expect to generate up to 10% in advertising fees of Amazon’s qualifying sales revenue of an item. ‘Qualifying revenue’ means the sales revenue, minus associated costs like shipping, insurance and credit card fees.Branding 101: An introduction
4. Google Custom Search Ads
Google AdSense isn’t all about display ads and videos. If you’ve got a search bar on your website, you can also use AdSense to monetise your site’s search results with Google Custom Search Ads.
Google Custom Search Ads works a lot like AdWords in ordinary search results on Google. Every time somebody uses the internal search bar on your website, Google will automatically add a couple of clearly labelled sponsored results as part of the results page. Every time a user clicks on a sponsored search result, your company gets paid for the referral.
This affiliate marketing method even allows you to choose when customers do and do not see ads in your internal searches. For example, Google’s Custom Search Ads for Mobile programme enables companies with a mobile app or mobile site to cut and paste a snippet of code so that mobile users see ads in search results while browsing on their phones. Meanwhile, desktop users continue to enjoy ad-free search results.
Google Custom Search Ads are easy to implement, and require absolutely no maintenance. Google subsequently guarantees and allocates payment in the same way it pays out for other AdSense commissions.
Want to get started? All you’ve got to do is sign up to create your own Custom Search Engine via Google. This dynamic tool enables you to produce a dynamic internal search function for your website – absolutely free.
5. eBay Partner Network
If you’re looking for a new way to sell your company’s products online, you should definitely check out setting up your own online store on eBay. But even if you’d rather not sell on eBay, you can still create a steady passive income stream by signing up for the eBay Partner Network.
The eBay Partner Network functions a lot like Amazon Associates. After signing up for the service and telling eBay a bit about you and your company, you’ll be invited to look through some of eBay’s 1.1 billion listings to select the types of products you’d be willing to promote on your company website, blog or social media channels.
eBay’s simple link generator will then produce a bit of code or a URL that you can subsequently cut and paste anywhere on your company website. Alternatively, you can even just tweet the link or share it on social media. Every time somebody clicks on your link and makes a purchase, you get paid.
eBay partners earn between 50% and 70% of revenue from each purchase, and eBay will pay a commission to your company even if the lead you generated doesn’t make a purchase immediately. As long as the user who clicked on your affiliate link buys the corresponding product within 24 hours, you’ll be given a commission.
The eBay Partner Network also tends to offer additional commission bumps depending on the type of product you’re able to help them sell and who is making the purchase. For example, your commission earned will increase by a nominal fee if the shopper you’ve given them hasn’t made a purchase on eBay in the last 12 months.
The bottom line
Although affiliate marketing is a fast and super easy way to make extra money for your business, it’s not something you should dive head-first into. You can’t forget that by joining an existing affiliate network, your company is effectively becoming an advertiser for another business. That’s something you may or may not want to do, depending upon how you’re trying to leverage your company as its own brand.
That being said, affiliate marketing can be done very tastefully – and you can even strike a balance that generates sales for both you and your affiliate company. It just takes a bit of trial and error. When in doubt, start small and see how things go. As long as you’re willing to persist, and you’re able to find a network that marries well with your company, then affiliate marketing will be a fantastic passive income stream to help support your company.
Keen to discover more tips on marketing, websites and how to manage your limited company’s online presence? Check out the Rapid Formations Blog. There, you’ll find loads of information on social media advertisements, how to reduce your company’s carbon footprint, company shareholders and more.