What Is Affiliate Marketing and How Does It Work?

UPDATED: September 13, 2025
PUBLISHED: September 13, 2025
TABLE OF CONTENTS
affiliate marketing notebook
At a Glance:
Affiliate marketing is a performance-based model where you promote products or services and earn a commission when someone buys (or completes an action) through your unique affiliate link. It’s a low-cost way to start earning online that can scale from side hustle to full-time income.

In the United States alone, affiliate marketing spending is expected to reach $12 billion in 2025. So, whether you’re just getting interested in this industry or have already planned to become an affiliate marketer, you have likely made a good choice. 

Thanks to its great income potential and growing popularity, affiliate marketing has become a lucrative side hustle. For some, it can even be a promising full-time career option. However, if you’re new to this industry, it may also seem unfamiliar, as it differs from other e-commerce businesses

This guide explains what affiliate marketing is, how it works, and practical steps on how to start. You’ll see real examples, common payout models, how to make money—and whether affiliate marketing is worth it for you.

What Is Affiliate Marketing?

Affiliate marketing is a marketing model where you earn commissions for promoting products or services. It’s a type of performance-based marketing, meaning your income directly depends on the number of sales or conversions you drive.

Basically, this is how affiliate marketing works:

  1. You share affiliate links of a product or service you want to promote online.
  1. Someone clicks on your affiliate link and buys the product/service.
  1. You get a commission for the purchase.

An affiliate link is a special URL that tracks every purchase that occurs through it. Each time someone completes a purchase by following your link, a commission is recorded and added to your affiliate account. The better your affiliate links perform, the more you earn as an affiliate marketer.

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How to Start Affiliate Marketing

One of the best things about this type of marketing is how simple it can be to get started. You don’t need any capital, founding partners or investors to become an affiliate. You just need a good understanding of the process, plus plenty of time and dedication.

Let’s now review the key steps to start affiliate marketing.

Step 1: Pick a Niche

According to a 2024 survey, the five most profitable affiliate marketing niches are:

  • Education and E-learning
  • Travel
  • Beauty and Skincare
  • Finance
  • Technology

However, you don’t always have to go for the most popular or profitable niches. Instead, choose a niche that best suits your unique preferences and situation. As a beginner, it’s best to pick a niche that isn’t too competitive, is at least somewhat familiar to you, and aligns with your audience’s interests. 

Remember that there is no right or wrong niche. So choose one that is relevant to you and your audience—or target audience if you don’t have an audience base yet—and has a good earning potential.

Step 2: Find Affiliate Programs

Once you’ve zeroed in on a niche, it’s time to find some promising affiliate programs you can join to become an affiliate. Here are some ways to find affiliate programs:

  • Explore popular companies’ websites. You’ll want to look for sections like “Partner with us,” “Affiliate Portal,” “Referral Program,” or “Become an Ambassador.” Alternatively, try searching for “[company name] affiliate program” on Google.
  • Search for key terms. Examples include “best affiliate programs in [niche]” or “affiliate programs in [niche] in [country]” on Google.
  • Follow companies and influencers on social media. Stay up-to-date with any promotional affiliate programs they share.

As you explore affiliate programs, there are several factors to consider before joining. This includes the brand’s reputation, the commission you’ll earn per sale, and the minimum amount you must earn to cash out.

And don’t forget to ask about cookie duration. This is how long a tracking cookie remains active on a user’s browser once they click on your affiliate link. (The longer the duration, the better!)

Amazon Associates is the most popular affiliate program. But there are plenty of other programs, too, such as the Shopify Affiliate Program, Rakuten Advertising and eBay Partner Network.

Step 3: Create Content and Start Promoting 

Let’s say you’ve chosen the niche and some affiliate programs, too. Now comes the most crucial step: creating quality content that drives engagement—making users click on your affiliate links. 

Various types of content, such as product reviews, comparisons and recommendations, work well in affiliate marketing. However, you can create any kind of content you want and creatively promote products. 

For example, suppose you are a travel vlogger creating a YouTube video on how you plan your trips. You can promote the travel company you use to book flights and accommodations. You can also add affiliate links to travel essentials like backpacks, travel blankets, etc.

How to Become an Affiliate Marketer With Content Creation

Creating high-quality and engaging content is key to becoming an affiliate marketer. Depending on your preferences and skills, you can choose from several ways to create content, such as:

  • Blog posts
  • Videos
  • Social media posts
  • Emails

You don’t have to choose all of them at once. Just start with one that best aligns with your skills. For example, if writing is your forte, blog posts, social media posts and email marketing might be good starting points. If you like talking and making videos instead, YouTube, Instagram and TikTok are excellent places to begin. 

That said, it’s best to leverage multiple channels to maximize your reach and earnings. So consider creating a mix of video-based and text-based content as you grow.

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Types of Affiliate Marketing

There are multiple approaches for promoting products via affiliate marketing. In 2009, one of the most popular affiliate marketers, Pat Flynn, described three categories of affiliate marketing based on a marketer’s level of familiarity with the products they promote:

1. Unattached Affiliate Marketing

This is when you promote random products without having any relevant personal experience or familiarity with the niche or brand. Unattached affiliate marketing usually involves putting random pay-per-click (PPC) ads in your content. For example, you can write a blog post and put affiliate ads throughout the page.

This involves promoting products from a niche that’s related to your audience. You may not have used the product or service, but it’s still relevant because your audience is interested in the niche.

For example, if you maintain a blog on personal finance, you can include affiliate links or ads for money management platforms or online lending apps in your blog posts.

3. Involved Affiliate Marketing

This is when you recommend a product you have personally used and liked and want to recommend to others. You promote such products via reviews, comparisons, tutorials and similar personalized content. 

Involved affiliate marketing is the most promising type of affiliate marketing in the long run, as it lets you directly build trust with your audience. It is also the most responsible approach, as any bad product can kill someone’s trust in your recommendations.

Building an Engaged Audience 

For you to grow as an affiliate marketer with your content, your content must serve your audience well. As Pat Flynn says, “your audience is really what makes your business work.”

Here are some tips to build an engaged audience via your content:

  • Choose the right product. Understand your audience’s pain points and ensure that the products you promote help them in some way. 
  • Get in the audience’s shoes. When reviewing a product, explain its features, specifications or any other details that’ll help the audience understand the product better.
  • Be honest! If you are promoting a product, make sure it’s something you truly find valuable enough to share with others. Remember that while commission rates can vary across products, your audience’s trust builds over time and carries more weight.

Building and nurturing an engaged and trusting audience is a long-term game. It is possible only when you build your content creation process around your audience. 

How to Make Money with Affiliate Marketing

According to Glassdoor, the estimated income of an affiliate marketer in the U.S. is around $96,000 per year. Prominent niches like education and e-learning can even pay over $15,000 per month. These are just average figures.

Put simply, it’s no secret that affiliate marketing offers great opportunities to earn. But what’s equally interesting is the types of ways you can get paid.

Pay Per Click

This is the simplest model where you get paid each time someone clicks on your affiliate link. In other words, you earn money to drive your audience to the merchant’s platform, even if they don’t purchase a product or service.

Pay Per Lead/Cost Per Action (CPA)

In this payment model, a merchant pays you each time someone clicks on your affiliate link and performs a specific action. This might be creating an account, downloading an app, subscribing to a newsletter or filling in a Contact Us form.

Pay Per Sale

Pay per sale is a revenue-sharing model and the most common way to earn via affiliate marketing. You get paid when someone completes a purchase via your affiliate link. The commission rates vary depending on the niche and the product. 

Subscription-Based Models

If you are promoting a subscription-based product such as an antivirus plan, a software-as-a-service (SaaS) product or any membership-based website or platform, you can get affiliate commissions for each recurring payment. 

Hybrid Models

Many companies offer hybrid payment models that give you the best of all worlds. You can earn commissions for driving sales, but also for generating clicks and leads. In this model, your efforts are compensated even if a sale doesn’t happen.

Affiliate Marketing Examples: How Brands and Creators Profit

Affiliate marketing examples are so abundant everywhere online that it’s easier to overlook them than to notice them. No matter whether you have ever been an affiliate marketer, chances are you have come across affiliate content many times in the past and even clicked on affiliate links. 

Most review and comparison websites contain affiliate links for the products or services they recommend. For example, this Wirecutter article on travel backpacks is full of affiliate links to the backpacks mentioned. 

Besides Wirecutter, some popular affiliate marketing websites include:

  • Skyscanner: A travel website for recommendations and comparisons on flights, accommodations, etc.
  • The Points Guy: A website that has travel and finance content (especially credit cards). They get paid each time someone signs up for a card and gets approved.
  • DatingAdvice.com: The website earns when a user signs up on the dating sites they recommend.

You can find affiliate links in any random article or blog post, too. Similarly, many influencers and creators earn via affiliate marketing by adding affiliate links in their YouTube video descriptions, social media captions or even bios. This is called influencer marketing.

Popular affiliate marketers like Pat Flynn and Matt Giovanisci earn from multiple channels, including blog posts, YouTube videos and social media. 

Is Affiliate Marketing Worth It? Pros and Cons to Consider

The answer to this question is very subjective. After all, the unique nature of affiliate marketing gives it a fair share of benefits and challenges.

Let’s look at some of the most notable pros and cons of affiliate marketing.

Pros of Affiliate Marketing

Here are some of the powerful benefits of affiliate marketing:

  • Passive income potential: You just have to put in a one-time effort to create a piece of content. If done well, it may keep driving money weeks, months or even years later.
  • Negligible upfront investments: Most affiliate programs are free to join, so the only monetary cost (if any) you bear is typically for creating and promoting content.
  • Uncapped earning potential: The greater your reach, the higher your affiliate income.
  • Multiple revenue channels: You can promote products from multiple niches via multiple content formats (blog posts, videos, etc.).
  • Flexibility: You can work anytime from anywhere you wish.
  • No risks: Since you don’t have your own product and investments, you don’t have anything to lose (except time, energy and trust) if your content doesn’t perform well.

Cons of Affiliate Marketing

There are some downsides, however. These include: 

  • Takes time: Unless you already have a big and engaged audience, it takes a lot of time to build an audience and start earning via affiliate marketing.
  • Lack of stability: Since your content’s performance depends on various factors like trends, social media algorithms and SEO, income can be very uncertain.
  • Competition: Some niches are highly competitive, making it harder to rank on Google or social media platforms.
  • Dependence on affiliate programs: Since your commission rates are decided by brands, your earning potential is not entirely in your control.

Is Affiliate Marketing Right for You?

Affiliate marketing is a performance-based way to earn online: you promote relevant products or services and earn a commission when someone buys (or completes an action) through your affiliate link. With low startup costs and flexible upside, it can begin as a side hustle and grow into a full-time income.

Whether affiliate marketing is worth it comes down to your timeline, effort and trust with your audience. If you’re willing to learn, publish genuinely helpful content, disclose links and track what converts, you can build a durable revenue stream.

To start affiliate marketing, choose a focused niche that fits your interests and audience, join a few reputable programs after checking commission rates, cookie duration and payout terms, then publish useful reviews, comparisons or tutorials with clear calls to action and internal links. Measure clicks and earnings regularly so you can double down on what works and trim what doesn’t—this is how you become an affiliate marketer and actually make money with affiliate marketing.

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Photo courtesy of Michail Petrov/Shutterstock

Jeet Kumar Ambasth

Jeet is a freelance writer with over three years of experience crafting blog posts and articles across diverse niches. A science graduate by choice and a literature aficionado at heart, he loves stories in any form or format. Thanks to an ever-burning curiosity, his interests span mythology, art, physics, philosophy, traveling and myriad other things. When he’s not working, you’ll likely find him lost in a book, watching a TV show or practicing French on Duolingo.

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