What Is Affiliate Marketing? Everything You Need to Know in 2023

Affiliate marketing guide

Affiliate marketing is a great way to generate additional income. You can become an affiliate marketer and recommend other brands, or you can start an affiliate program to promote your own brand.

With affiliate marketing, both brands and creators benefit. Brands get trusted referrals from relevant creators and access to new audiences. In turn, affiliates and creators make a commission on sales or other marketing actions resulting from the affiliate link. 

This complete guide will walk you through how to become an affiliate marketer who promotes other brands. We’ll go over how to start making money with affiliate marketing, online marketing tips to set up a successful affiliate program, and best practices to help you earn more money.

What is affiliate marketing?

Affiliate marketing is a process where content creators or publishers earn a commission by promoting a product or service made by a retailer or advertiser. The affiliate partner is rewarded a payout for providing a specific result to the retailer or advertiser. This is achieved by a tracked affiliate link that the marketer uses to promote the product or service.

Typically, affiliates are rewarded for a sale. But some affiliate marketing programs can reward you for leads, free-trial users, clicks to a website, or getting downloads for an app. 

An affiliate network is a website that connects creators or influencers with different brands’ affiliate programs.

Many affiliate programs are free to join. Done right, an effective affiliate marketing strategy can go from side hustle to a profitable online business idea generating passive income.

How affiliate marketing works

Affiliate programs work by allowing individuals or businesses (affiliates) to promote and sell products or services of a company in exchange for a commission on each sale. The affiliate earns a commission each time someone makes a purchase through the unique affiliate link associated with their recommendation.

Here’s how affiliate marketing works at a high level:

  • An affiliate shows an ad or a link for Store Z on their website, blog, or social network.
  • A customer clicks the unique affiliate link.
  • The customer makes a purchase in Store Z.
  • The affiliate network records the transaction.
  • The purchase is confirmed by Store Z.
  • The affiliate gets paid a monetary commission.

Commission rates for affiliate sales vary depending on the company and the offer. On the low end, you might earn about 5% of the sale, but with some arrangements, you can earn as much as 50% with high ticket affiliate programs. Some affiliate marketing programs provide a flat rate per sale instead of a percentage.

3 types of affiliate marketing

Affiliate marketer Pat Flynn breaks down the different types of affiliate marketers into three groups. Understanding these types of affiliate marketing arrangements can show you the different ways people make money online in this space.

An individual sitting at a desk with an open book and a laptop in front of her

1. Unattached affiliate marketing

The first type of affiliate marketing is referred to as “unattached,” or when you have no authority in the niche of the product you’re advertising, i.e., There’s no connection between you and the customer. This often involves running pay-per-click (PPC) advertising campaigns with the affiliate link and hoping people will click it, buy the product, and earn a commission.

Unattached affiliate marketing is attractive because you don’t need to do any legwork. Affiliate marketing businesses rely on reputation and trust with a target audience online. Some affiliate marketers don’t have the time or desire to build those relationships, so this type of marketing is their best option.

“Unattached affiliate marketing isn’t a genuine business model—it’s for people who just want to generate income,” says Elise Dopson, founder of Sprocker Lovers

2. Related affiliate marketing

Related affiliate marketing is the practice of promoting products and services you don’t use but that are related to your niche. An affiliate marketer in this case has an audience, whether it’s through blogging, YouTube, TikTok, or another channel. A related affiliate marketer also has influence, which makes them a trusted source for recommending products, even if they’ve never used them before.

While related affiliate marketing can generate more affiliate income, it comes with the risk of promoting something you’ve never tried before. It could be a poor product or service, and you wouldn’t know. It only takes one bad recommendation to lose the trust of your audience. If you don’t have trust and transparency, it’ll be hard to build a sustainable affiliate marketing business.

3. Involved affiliate marketing

Involved affiliate marketing refers to only recommending products and services the affiliate marketer has used and truly believes in. “Involved affiliate marketing is the way forward,” says Elise. “It’s rooted in trust and authenticity, which is best for your audience and business.”

In this type of marketing, an affiliate marketer uses his or her influence to promote products and services that followers may actually need, instead of paying to get clicks on a banner ad. It takes more time to build this type of credibility with an audience, but it’s necessary for building a sustainable business.

Involved affiliate marketing is the only genuine way to become a trusted source on any topic.

Elise Dopson, founder of Sprocker Lovers

Elise explains that the involved approach makes advertising much easier for affiliate marketing partners: “You don’t have to hide behind expensive PPC ads and hope for clicks and sales. An organic Instagram Story or blog post about your experience with a product will go a long way.” Elise prefers this method because it’s honest and is “the only genuine way to become a trusted source on any topic.”


A screenshot of Sprocker Lovers' website
Sprocker Lovers’ website shares trusted products through in-content links and ads using affiliate links.


Pros and cons of affiliate marketing

The affiliate marketing industry had an estimated worth of $8.2 billion in 2022, making it a popular marketing strategy for businesses. For creators, it’s also a low- to no-cost business venture you can profit from immensely. But before diving in, consider the pros and cons of entering the affiliate marketing world.

Affiliate marketing pros

While industry growth is a good indication of success, entrepreneurs also take this referral marketing route for a few other reasons.

Easy to execute

Your side of the equation involves simply handling the digital marketing side of building and selling a product. You don’t have to worry about the harder tasks, like developing, supporting, or fulfilling the offer.

Low risk

There’s no cost to join an affiliate program. Once you’ve done the work to build an audience, you can start making money with an established affiliate product or service without additional investment. Affiliate marketing can also generate relatively passive income through commission—the ideal money-making scenario. 

Ability to scale

Successful affiliate marketing offers the potential to significantly scale your earnings without hiring extra help. You can introduce new products to your current audience and build campaigns for additional products while your existing work continues to generate affiliate revenue in the background.

Before you get too excited, know that great affiliate marketing is built on trust. While seemingly there are an endless number of products or services to promote, it’s best to only highlight those you personally use or would recommend. Even when a product interests you or fits within an existing hobby, becoming a great affiliate marketer for that product takes a lot of work.

📚 Read more: The Beginner’s Guide to Setting Up an Affiliate Program for Your Shopify Store

Affiliate marketing cons

Affiliate marketing also has a few disadvantages compared to other types of marketing campaigns. Before jumping in, let’s look at a few challenges you’ll face on your journey to affiliate marketing success.

Requires patience

Affiliate marketing is not a get-rich-quick scheme. It requires time and patience to grow an audience and gain influence.

You’ll want to test different channels to see which connect best with your audience. Research the most relevant and credible products to promote. Spend time blogging, publishing free content on social media, hosting virtual events, and doing other lead-generating activities on your marketing channels.


There’s no boss handing you a weekly paycheck as an affiliate marketer. Affiliate marketing programs work on a commission basis, whether you’re paid by lead, click, or sale.

Companies use a temporary browser cookie to track people’s actions from your content. When a desired action is taken by someone, you receive the payout.

No control over program

Affiliates must obey the rules set by a company for its affiliate program. You need to follow its guidelines for what you say and how you present its product or service. Competitors must follow the same recommendations, so you have to get creative to differentiate yourself from the crowd.

How do affiliate marketers make money?

Affiliate marketing income spans a large spectrum. There are some affiliate marketers who make a few hundred dollars per month and others that make six figures a year. The larger your following, the more money you can make as an affiliate marketer.

Compensation software company Payscale reports that the average annual salary of an affiliate marketer is more than $55,000, based on over 7,000 salary profiles, with many affiliate marketers earning significantly more.

Affiliate marketing payment models

When you choose an affiliate program to promote, you’ll notice there are different payment models. Companies may also call it a price model, payout model, conversion type, or another variation.

Regardless of the name, the payment model tells you what goals you will get paid for. If you’re promoting a software product, the action could be a free trial signup. For an affiliate marketer who promotes physical products, the goal will likely be a purchase.

Many affiliate marketing programs run with last-click marketing attribution, which means the affiliate who receives the last click before purchase gets 100% credit. However, this is changing, as affiliate programs improve attribution models and reporting. For example, you could share equal credit for a sale if there were multiple affiliates in a buyer’s conversion funnel.

Five common ways affiliates get paid include:

1. Pay per sale, where you earn a commission for each sale you make. It’s a common payout model for ecommerce offers.

2. Pay per action, which earns you a commission for a specific action. Many affiliate programs use this payout model because it’s broad and can be applied to different offers: a newsletter signup, a click, contact request, form submission, etc. 

3. Pay per install, where you are paid for every install generated from your website traffic. The goal of your content would be to promote mobile apps and software so that people download or install them.

4. Pay per lead, which pays you every time someone signs up for something. It's a popular payout method because companies use it for sweepstakes, lead generation, and other types of offers. Cost per lead offers are common for beginners because it’s easier to generate leads than to sell products to an audience. 

5. Pay per click, a rare payout system where you earn commission on every click on your affiliate link. A pay-per-click affiliate program may be used by big merchants with a goal to build brand awareness. Customers don’t need to sign up or buy anything, just to visit the merchant’s website.&nbsp

How much you make depends on your affiliate niche. For example, research conducted by Shopify in 2021* found that the highest average commission rate ($70.99) was for business-related programs, while books and media and clothing categories earned just over $6 per commission. The maximum average commission we found was around $289.06 per sale.

A bar graph of the average programs average commission and conversion rate compared between different industries

How to start affiliate marketing in 4 steps

  1. Pick your platform and method
  2. Determine your niche and audience
  3. Find your products
  4. Choose your first affiliate program

Just like running your own small business, becoming a successful affiliate takes dedication and discipline. Use the following step-by-step guide to start your affiliate marketing business. 

1. Pick your platform and method

The first step is figuring out the platform you want to build your audience around. Every affiliate marketer has a different approach and platform. There are many affiliate marketing ideas you can choose from based on different methods:

  • Niche topic and review sites. These are sites that review products for a specific audience or compare a line of products against their competitors. This method requires you to create content related to the review space and post regularly to draw in an audience.
  • Digital content. Digital content creators include bloggers, YouTubers, and social media influencers. They create niche content that resonates with a target audience. The goal is to organically introduce niche products their audience will enjoy. This increases the chances the audience will buy and you’ll earn an affiliate commission.
  • Courses, events, workshops. If you’re an educator, you can integrate affiliate partnership offers into your events.

No matter which route you take, authenticity and audience building are the two most crucial elements for affiliate marketing. If you can’t authentically connect with your audience, chances are you won’t have success in converting them into affiliate sales.

To pick a platform and method, ask yourself: What platforms do you use the most? Which platforms do you understand best? 

Common platforms affiliate marketers use are:

  • Blogging
  • Instagram 
  • TikTok
  • Facebook
  • Pinterest 
  • Pay per click (PPC)
  • YouTube

Starting with a marketing platform you’re comfortable with helps you create high-quality content. This can result in a stronger, more engaged audience you can turn into sales. 

2. Determine your niche and audience

When it comes to choosing a niche, aim for something you’re passionate and knowledgeable about. This helps you come across as authentic and as a trusted source of information for potential customers. It also helps you evaluate which products and brands you want to promote.

Say, for example, you started a blog about dogs, helping owners care for their pets.

You regularly post and encourage people to subscribe to an email list and share your content. Dogs are your niche, and you’re going to invest in content marketing and search engine optimization (SEO) to grow your audience of owners.

“The niche you choose for your affiliate site guides how much time or effort you’ll need to put into building it to a point where you begin to see SEO results,” says Elise. “SERPs for software, marketing, and health care, for example, are all dominated by huge blogging sites with even bigger marketing budgets. The secret is finding untapped areas where competition isn’t as fierce—and getting in there before other people recognize it.”

As you post more, you can use affiliate marketing tools like social listening, website analytics, and social media insights to discover who your audience is and what they like.

Remember, you’re not paid to post. Affiliate marketing is a performance-based online business. It’s important that you know your audience so well that you understand why they follow you in the first place. If you know what your audience likes, you can then leverage that knowledge, refer the best products to them, and earn more affiliate income.

3. Find your products

To earn revenue as an affiliate marketer, your audience needs to connect with what you’re saying. The items or services you promote need to be products they genuinely want. Getting this wrong can hinder your success and diminish your credibility—as well as your audience. 

If you’re curious where to look for products or brands to work with, don’t worry. There are tons of affiliate networks and marketplaces, including:

Another option is to visit the websites of the products and services you use and like to see if they have an affiliate program. Large companies often have programs they promote on their site, such as the Shopify Affiliate Program.

A screenshot of Shopify's Affiliate Program page

You also can take a more direct approach. Reach out to the owner of a great product you come across and see if they offer an affiliate marketing program. If they don’t, they might be happy to set up an arrangement with you, such as offering you a special coupon code to share with your followers.

The best deals often are found when you’re the first to inquire and have a relevant distribution channel, such as approaching the seller of a new fitness product if you’re a health and wellness blogger.

Affiliate marketing programs will have terms of service you need to follow, so read the fine print. For example, your affiliate link usually will have a cookie with a specified timeframe, and some programs don’t allow you to purchase pay-per-click ads using the product or company’s name.

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Shopify Collabs makes it easy to find brands that match your vibe, build affiliate relationships, get paid for what you sell, and track everything in one place.

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4. Choose your first affiliate program

As you brainstorm products or browse through affiliate platforms, the most important criteria to keep in mind is that the product should be aligned with your audience, or the audience you hope to build. Ask yourself: Is it something your target audience would find valuable? Does it fit with your area of expertise? Choose an affiliate program that suits your brand and income goals.

Make sure the product or service you’re promoting is a fit for the platform you’re promoting it on. For example, home décor and clothing are well suited to image-heavy platforms like Instagram. However, if you’re promoting more in-depth purchases, like software, your conversion rates may be higher on longer-form platforms, like a blog or YouTube.

Tips for affiliate marketing success

Affiliate marketing revenue can eventually become a form of passive income, but you still have to do some heavy lifting upfront. The following tips will help you find success with affiliate marketing.

Build trust

If you’re writing a personal review, give a candid opinion based on your experience with and knowledge of the product. The more open you are, the more authentic you will be. People will be more comfortable following your advice if they feel they can trust you.

Trust is a key factor in your affiliate marketing efforts, because people need to trust you enough to act on your recommendations. The level of trust you’ll need to make affiliate sales depends on your industry and the products you’re recommending—for example, it takes more trust to be an effective affiliate for a $1,000 course than it does for a $20 t-shirt.

“Beyond just sharing your experiences, you can build trust by limiting the number of affiliates you promote, or by only becoming an affiliate for products you personally use and sticking to your area of expertise,” says Desirae Odjick, who spent years running the personal finance blog Half Banked before it was acquired. “For example, people trusted my recommendations for Canadian financial apps, but that doesn’t mean I would have had much luck as a Sephora affiliate.”

Talk to a product expert

Another option is interviewing others who use the product or service, or even interviewing the person who makes or sells it. This can give your review more depth, creating a narrative for the reader.

Create a product tutorial

While your success with affiliate marketing can depend on the overall size of your following, another way to drive traffic is by providing a tutorial on the offer. 

People often perform “how to” Google searches, such as “how to save money for college” or “how to decorate a laundry room.” If you offer a tutorial that solves a searcher’s problem and clearly showcases the value of the product, your referrals will make more sense in context, and you’ll provide the customer with a stronger incentive to purchase the product you’re recommending.

Build an email list

An email list is a list of contacts you’ve gathered who would like to receive information from you. It’s important to build a contact list because it’s one of the best ways to connect with people outside of social media. When it comes to purchases made as a result of receiving a marketing message, email has the highest conversion rate (66%) compared to social and other marketing channels.

Gather emails from your content, then write and send a newsletter weekly or biweekly to subscribers. Affiliate marketers can send many different things to subscribers on their list:

  • Free downloads
  • Reports
  • New blog posts
  • A look inside your life or business
  • Entertaining stories
  • Reminders and news
  • Special deals

Use your email list as an opportunity to show value to subscribers. If they send you an email back, respond. Be consistent with your newsletter cadence and quality. Then, every once in a while, promote an affiliate product or two to subscribers.

There’s no hard rule on how many times to send promotional emails. Just don’t send them every time you have a promo or you’ll come off as spammy and untrustworthy. If you’re promoting good products once a month, you’re only providing value to subscribers who need them.

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Find relevant search terms

If you’re promoting an offer through a blog post, research which keywords someone might use in a search engine to find an answer to a related problem. Google Ads Keyword Planner is a great tool that can help. (It’s free to use, but you’ll need to create an account.)

📚 Read more: What is SEO Marketing and How Does It Work? 

Consider your angle

Depending on your offer, figure out how much energy you should invest in instructional or tutorial content, which is often a natural lead-in to someone trying a product for themselves.

For example, you could record a video of yourself using and getting the most out of a physical product or showing off the benefits of a digital product, like software. Unboxing posts are popular, so if you receive the product in the mail, document your experience opening it up.

Set your distribution strategy

Once you’ve written your promotional content, share it on your website or social media platforms. If you have a subscriber list, you can create an email marketing campaign. And be sure to have an affiliate marketing hub on your website with a resources page where you share a quick list of all of the tools you use and love.

Try offering a bonus

Sometimes marketers promote their affiliate programs by offering bonuses to anyone who purchases the offer. For example, you could give a free ebook you wrote to any follower who makes a purchase.

Promotions like this encourage customers to buy by sweetening the deal. They’re especially persuasive if the bonus you offer is something you normally sell, because then shoppers can see its actual dollar value right on your site.

You can find several examples of affiliate bonuses in action when business coach Marie Forleo opens her popular B-School for entrepreneurs each year. To encourage sign-ups through her affiliate link, Laura Belgray, Forleo’s own copywriter, offers a one-on-one copywriting session as a bonus.


A screenshot from the Talking Shrimp website
Talking Shrimp


Keep things legal and above board

Don’t forget to disclose to followers that your post contains affiliate links. For one thing, it’s required by the FTC. But explaining the reason for your affiliation also can help you connect with your audience. 

For example, the financial independence bloggers at Frugalwoods offer this disclosure: “Frugalwoods sometimes publishes affiliate endorsements and advertisements, which means that if you click on a link and buy something, Frugalwoods might receive a percentage of the sale, at no extra cost to you. We only write about and promote products that we believe in. We promise not to tell you about stuff that’s dumb.”

If you need help figuring out what language to use in a disclaimer, it’s worth taking time to consult a lawyer.

📚 Read more:  16 Affiliate Marketing Tips & Strategies to Earn More Money

Affiliate program examples

Looking at some of the companies that participate in affiliate marketing will provide you with inspiration—as well as proof that this is a legit and high-paying revenue stream. Browse these affiliate program examples to learn about the different models.


A screenshot of Shopify's Affiliate Program page

Shopify's Affiliate Program is a network of entrepreneurs, educators, influencers, and creators who send referrals to Shopify. It’s free to sign up for the affiliate program, you only need to apply. 

Once approved, affiliate partners get a unique affiliate link to share with their audience. They earn affiliate income each time someone signs up using their link.

On average, Shopify Affiliates earn $58 for each referral who signs up for a paid Shopify plan. Affiliates can earn as much or as little as they want, it all depends on how much time they spend on their affiliate marketing strategy.

“I have worked with dozens of companies over my 11 years online. Shopify has been one of the best and made it easy for me to promote their product, make money, and provide value to my community,” says marketer Ezra Firestone.



A screenshot of the Healthish "Join our community" page

Water bottle retailer Healthish used affiliate marketing to build a million-dollar brand. Rather than take the traditional affiliate route, it used Instagram influencers to build awareness for the launch of its keystone product, the WB-1 bottle.

The brand’s affiliate program continues to work with influencer accounts, ranging from those with 100,000 followers and up. It works with around 300 creators per month to create content that markets and sells the bottle at scale. 

📚 Read more: The Pre-Launch Strategies of a Million-Dollar Brand

Frankies Bikinis


A screenshot of the Frankies Bikinis "Become an Abassador" page
Frankies Bikinis

Swimwear brand Frankies Bikinis refers to its affiliates as ambassadors, hashtagged #Frankiesgirls. It uses ShareASale, RewardStyle, and Skimlinks to manage its affiliate program. The brand encourages active women with strong social presences to apply. Commissions are paid in cash, and the brand offers an updated list of active promos for ambassadors to use.

Juice Beauty


A screenshot of the Juice Beauty "Affiliate Program" page
Juice Beauty

Juice Beauty is a skin care brand based in California that offers an affiliate program via Rakuten. Commission rates start at 6% on all sales, and have access to special deals and discounts. Juice Beauty doesn’t charge any application or membership fees to its affiliates.



A screenshot of the Urikar "Affiliate Program" page

Retailer Urikar offers a high-ticket affiliate program with average commissions of $1,460, according to data from ShareASale. It sells fitness and wellness products like massage guns, indoor and outdoor workout equipment, and accessories.

Urikar offers a 10% commission on all sales, which can add up quickly if you are a fitness influencer with a big following. Its most popular product, an AI-powered muscle massager, retails for $269.99, which means you’ll earn $26.99 for each sale. Urikar's program also provides your own dedicated account manager and affiliate dashboard to track conversions and sales. 



A screenshot of the EcoFlow "Interested in Becoming an Affiliate?" page

EcoFlow is a brand of smart solar solutions from portable air conditioners to whole-home generators. The company works with two different affiliate program partners to help it connect with affiliate marketers. An affiliate can expect to earn a 5% commission on a sale. Keep in mind, however, that the average order value is $1,000—meaning a $50 commission for your marketing efforts. 



A screenshot of the Manduka affiliate page

Yoga brand Manduka offers a number of referral and affiliate programs for yoga teachers, influencers, and affiliate publishers. The diversity of this affiliate marketing strategy means that Manduka can connect the right partners with a program tailored to their channels or audiences.

Good To-Go


A screenshot of the Good To-Go "Affiliate Program" page
Good To-Go

Camping food brand Good To-Go offers an affiliate program with a 10% commission rate and other perks. Due to its niche market, Good To-Go can partner with social media influencers in the outdoor living space to run affiliate campaigns targeting its desired audience: campers and backpackers.

💡 Tip: Shopify Collabs is a great way to connect with a compatible brand with an active affiliate program is through. 

Start your affiliate marketing business today

Earning money with affiliate marketing programs can be a rewarding way to add a new revenue stream for little or no money in upfront investment. Affiliate marketing takes time, but by putting in the hours to find the right affiliate network and dial in your strategy, you can build an affiliate system that generates passive income for years to come.

*Methodology: Data gathered (program name, industry, average commission, average conversion rate) from an affiliate network site of 200 affiliate programs, 20 random programs each from 10 industries. The data comes from a seven-day measurement period (December 7–14, 2021). Limitations include: Data is gathered only from one affiliate network site. Not all categories could be included because of lack of program availability and time constraints of data collection.

Affiliate marketing FAQ

What does affiliate marketing mean?

Affiliate marketing means you earn a monetary commission by promoting a company’s product or service using an affiliate link. An affiliate partner is rewarded a commission for providing a specific result to a merchant or advertiser, be it sales, leads, downloads, etc. Affiliate income can be a percentage or dollar amount for each referral.

How do I start affiliate marketing?

You can start affiliate marketing by following these steps:

1. Decide on a niche.
2. Choose your platform.
3. Find relevant affiliate marketing programs.
4. Create valuable content.
5. Build an audience.
6. Follow FTC guidelines.

    Is affiliate marketing worth it?

    Yes, affiliate marketing is worth it. The affiliate marketing industry is estimated to grow to $8.2 billion by 2023, according to Statista. Affiliate marketing is inexpensive to start and carries low risk compared to other online business models.

    What are the top affiliate networks?

    Top affiliate networks include:

    • Affiliate Future
    • AvantLink
    • CJ
    • ClickBank
    • FlexOffers
    • LinkConnector
    • ShareASale

    What is an example of affiliate marketing?

    Shopify offers an affiliate program where entrepreneurs can refer merchants to the platform. It’s free to sign up. After a partner applies and gets approved for the affiliate marketing program, they receive a referral link. The partner goes and shares that link with their audiences. When someone signs up through the link for a paid Shopify plan, the affiliate partner earns a commission.