HomeSoftware/BusinessWhat is Affiliate Business? |Definition, Advantages, and Implementation Tips

What is Affiliate Business? |Definition, Advantages, and Implementation Tips

Currently, affiliate business is becoming a trend among entrepreneurs, bloggers, and content creators. Affiliate business becoming trend nowadays because only by surfing the internet, people are able to get commissions. Affiliate business first appeared in 1994 when CDNow released BuyWeb. At that time, CDNow invited other websites to join their program. After that, more and more websites are getting interest in joining the program they created because the system is easy. These websites only need to include a link to go to BuyWeb or backlink and if the visitors make a transaction, the website will get commission.

Definition of Affiliate Business

Affiliate is an activity or business that can make money when you successfully offer, sell products, services or websites to get commissions. One common form of affiliate business is a referral link. When you do affiliate, you will include a link on your website to direct visitors to other websites that provide products or services. Later sales will be tracked through affiliates from one website to another. It can be concluded that affiliate is a form of advertising in which the company will give money to third-party publishers for providing traffic to direct visitors to the products or services offered by the company.

Types and Terms in Affiliate Business

Pay per Click (PPC)

Pay per Click is the most common type in affiliate business. The company will pay for each click generated. They will pay for every button or link that leads to their website is clicked by your visitors. Pay per Click is not concerned with the visitor makes a purchase transaction or not. As long as the visitor clicks on the button or link that you provide, the company will pay. However, this type of affiliate business makes money less than other types. Generally this type of affiliate business commission is not more than $ 1 for every click made by visitors.

Pay Per Performance (PPP)

This type of affiliate business is a company favorite because it is very profitable for them. You will be paid if visitors interact on the company’s website such as purchasing a product or registering a program or other interaction. You can also generate greater income through this type because it can provide greater profits than the PPC type which can usually generate up to 15% to 30% of the sales of the product produced.

Residual Income Affiliate Marketing

This type is the most profitable type of all types of affiliate business. You are not only get commission from the first purchase. You can also get a commission for every customer who repurchases another product from the website you are promoting. Usually the amount of the commission is determined on a pre-determined presentation.

Affiliate Business Advantages

Affiliate Business is a low costs business

Usually, to start a business requires a high costs. However, unlike other businesses, affiliate businesses do not need to spend money to join affiliate programs because most companies will run their own product/service transaction processes so there is no need to worry about anything. When running an affiliate business, you don’t need to think about the high production costs that usually cost a lot of money to make a product. You also do not need a large investment from companies to start this business. The things needed to run this business are very easy. You only need a computer or laptop or smartphone and also an internet connection.

Also Read : Starting a Business in the Pandemic Situation

Affiliate business can make money anytime

Like other online business activities, this activity can generate money even when you are sleeping or on vacation anywhere. This business allows you to continue to sell 24 hours for 365 days even if you are doing other activities. Working anywhere is not a problem in running this business because you can monitor your business only through the internet. Because when you have finished creating the website or content you want and then you include a link to the website of the company that provides the service or selling product, you will get a commission for every visitor who clicks on the link. This means you can get more customers without spending time doing it.

Easy registration process

There will be no difficulty when you want to register in an affiliate program although sometimes some programs have procedures that are not easy. Businesses in conventional forms generally have to prepare a budget to get a license to run a business. Different than others, in an affiliate business there is no need for a license which is usually found in conventional businesses. You just need to fill out a form and start promoting the products/services offered. And when the product you’re affiliating doesn’t turn out to be making a lot of money, you can replace it with another product that might earn you more.

No team needed

When you build a conventional business, you will need a team such as HR, sales, marketing, logistics, designers and many more. People who have ever built a business know what it’s like to have employees in their business. When you have employees, there will be many additional costs such as salaries, allowance, guarantees and much more. You can run an affiliate business by yourself because this business is very possible to do alone. You also don’t need customer support because when there is a problem with the goods or services being sold, the company you are promoting will handle it. Because you don’t need a team, you also have the potential to earn more because you don’t need to share the income of this business with anyone.

Tips for Doing Affiliate Business

Define target market

Opportunities will be greater when you focus on a particular topic or target market. When you already have a focus on a particular topic and target market, you will get a wider place to sell your product or service, which in turn will bring in more customers and also sales. When determining the target market, you must pay attention to market competition because every product or business must have competitors. With the right target market, you will get more income. Currently, users of internet are spreading out all over the world. So it is possible that you will get visitors from abroad who can certainly become a new target market.

Related Article : Five Strategies in Developing a Marketing Plan

Do different product reviews

Review products have become common in the world of affiliate business. Review content has also been famous on the internet. But you can make your content a little different by packaging more attractively, telling your experience in using the product or service, including interesting images or videos with high quality and others.

SEO Optimization

Affiliate programs will perform better when you choosing optimal SEO. Find keywords and do research on keywords then make promotions according to SEO terms. With optimal SEO, your content will be on the first page in search engines that will make your website become high traffic. By having high traffic, you will get a lot of commissions because of the many visits and transactions that occur on the product or service you are affiliating.

Use Call to Action

The purpose of the affiliate program is for the audience to use your referrals. And then company identify that their customers are buying their products through you. In this case you need a Call to Action in bringing the audience to another website. Call to Action is a button that when a visitor presses the button, they will be directed to another website. Call to Action is usually an image or text “Click here”, “WhatsApp Us”, “Buy Now” and others.


Now you know what an affiliate business is, advantages, types and tips on doing an affiliate business, are you interest trying to do this business? Affiliate business is one of the options when you want to make money just by surfing the internet. Many companies need affiliate business so your opportunity in this business is still great. After reading this article, I hope you understand about what an affiliate business is and how to run it.

When running a business, you need ERP software from HashMicro which also provides free consultation so you would choose the right ERP software to run your business!

Interest in getting savvy tips for improving your business efficiency?

Muhammad Syahrian
Content Writer Intern at HashMicro. Passionate and hardworking person to develop my marketing skill.


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