WHAT is Affiliate Marketing?
In this video I’m going to explain what affiliate marketing is. And how does it really work?
If you’re new to this channel let me just give you guys a quick background about me. My name is Odi go by ODi Productions on YouTube. I have about 33,000 subscribers right now. And a little over ten million views. So I am a full-time entrepreneur and affiliate marketer. And two years ago I actually dropped out of the most applied to school on the planet and my dream school, UCLA with a GPA my senior year in order to pursue entrepreneurship and online business.
Thankfully I found affiliate marketing which has given me the lifestyle of my dreams today just two years later.
I live in my dream apartment here in downtown Chicago. And every single day I get to drive my dream car which is a custom Porsche 911 Turbo.
I want to teach you guys what affiliate marketing is.
So I’m going to show you guys the basics and fundamentals. Just explain how it works and I’m going to hop into my computer actually. And show you guys some real examples and show you step by step how people are using affiliate marketing these days to make money online.
And trust me when I say this, everyone does affiliate marketing.
Literally everyone. All the famous YouTubers, all the tech reviewers, people on Instagram, all those fitness people. Big companies like Uber, Lyft. Blogs like Smart Passive Income. And even small food blogs, “small” food blogs do affiliate marketing.
So, let’s just hop into the computer so I can give you guys an actual click by click, step-by-step on how affiliate marketing works and what it is.
Now I’m going to show you guys step-by-step some real world examples of how affiliate marketing works and how it is used in the real world.
But just to get things started, a basic description at its core of affiliate is that it is just referrals, okay. So affiliate marketing it’s kind of a fancy term for just referrals.
It’s basically referring people to products and services of companies that are not your own and then receiving commission if those people sign up or take action upon your referral. Usually through a link.
So just to give you guys a quick, quick example. So this is my video. It’s a review of a very popular headphone called the Audio-Technica ATH-M50x, which I actually have right here. It looks a little different from the video because I put some skins on them. But basically you guys can see 300,000 views.
And if you scroll down to the description, the first thing you see here is an Amazon link. And you guys as long as you weren’t born yesterday, if you watch any sort of tech review on YouTube, you’re gonna see Amazon links or some sort of funny looking links in description, And nine times out of ten those are affiliate links.
And what is an affiliate link?
Basically, Amazon Associates if I just go right here, it is Amazon’s affiliate program.
Amazon Associates is Amazon’s affiliate program. And as you guys can see, earn up to 10% advertising fees with a trusted e-commerce leader.
So if you join Amazon Associates which you guys can do today. It’s completely free but you might need to have a website in order to get approved. Some people are able to without it. But I would have a website just in case.
Where if somebody clicks your link it’s gonna be tracked back to you. And for Amazon Associates at least, if somebody buys anything from Amazon, not just the product which is the headphones. If they buy anything within 24 hours, you receive a percentage of the commission.
Now, the commission ranges. It definitely ranges based on the product category. It can range from 4 up to 10%.
So if I just look up Amazon Associates rates then we can actually see each specific product category and how much they pay. So let’s just look down. If we scroll down here you guys can see there are a fixed rate for each product on that you sell.
So if you sell something from let’s say in the PC category. So this could be computers, laptops, DVDs, Blu-ray, et cetera. You get 2.5% of that sale. So if you sell a laptop for $1,000, you will receive 25 bucks basically. So basically 2.5% right there. So that’s how it works at its core.
Amazon Associates is the largest in terms of affiliate programs because it just has the widest range of products. But there are many sort of affiliate networks that have more exclusive offers with the companies and with the products that may yield you a higher percentage of commission. This free report shows how to make big money with Amazon’s affiliate program.
So this is just a quick example right here of how people do it on YouTube.
I’m gonna move on to the next example which is blogs. And my favorite affiliate marketing blog is smartpassiveincome.com.
It’s created by a guy named Pat Flynn who is awesome. He has an awesome podcast that you guys should check out. But basically Pat’s been crushing it with affiliate marketing for as long as I’ve been in the game basically. And if you look at this, this is his income reports. And as you can see two mill during the last 12 months.
It’s insane. These numbers are crazy. Six figures a month. Six figures a month when a lot of people are trying to strive for six figures a year, this guy’s making six figures every single month. And it’s just insane.
But basically if you scroll down. If I just choose the latest income report. So we’ll do August 2017. I just scroll down and I’ll show you guys that he actually is transparent enough to share his affiliate marketing earnings broken down by company.
So as you guys can just scroll down here you see Amazon. He made about 600 bucks, not too bad. But if you scroll down to some of these other companies like Bluehost, you see $19,470 from a single source of affiliate marketing. So from posting links guys.
Again, it’s that simple, it’s that easy.
It’s completely passive income. Which is one of the reasons why I believe it is the best online business that anyone can take up today. So just to give you guys a little more detail into how this works …. see the video.
And now this works for most companies that have affiliate programs. You will see affiliates at the bottom footer. Now if you click that it will take you right into their affiliate program.
And you guys can actually see over five million paid in commissions last year alone. So as you guys can see this isn’t some sort of scam or anything.
Definitely do not confuse affiliate marketing with network marketing.
So basically you’re a salesman for real companies. You’re not selling energy drinks and driving around base three series. This this is a real business right here. This right here I mean look at this right now. Bluehost is a legit company. They also have affiliate programs for companies like HostGator, GoDaddy. You’ve heard of these companies. You’ve seen them on TV, you’ve seen them on ads.
These are real companies that were talking about. So anyways getting back into Bluehost’s affiliate program. If you scroll down, as you guys can see, free to join as with most affiliate programs. You guys can see how it works.
Basically you have custom banners and links just like Amazon Associates for every visitor who clicks your link and signs up within I believe a 30 day period. Now Amazon’s is only 24 hours.
But for most affiliate programs it’s usually around a 30 day tracking cookie. It’s between 14 days to 30 days. 60 days, sometimes 90 days. But 30 is the industry average for tracking links. And Bluehost, they will give you $65 a pop for everyone who signs up through your Bluehost link. Completely free to join just like Amazon Associates. Again, this is affiliate marketing. It’s very simple, it’s very basic. But I figured I’d just peel back the kimono and show you guys how people are really making money online behind the scenes.
Now I’ll give you one more example.
This is Instagram. One of my favorite YouTubers slash people that I follow on Instagram is Maxx Chewning. Been following him since the first few days back when he started doing the Full Day of Eating videos. Those were my favorite.
Basically here is an ad. This is for MVMT watches. And this is a little different because the thing is with affiliate marketing is you usually have links right. But another way that you can do this, now some people call this sponsorship, it’s all the same thing to me. Basically is providing coupon codes. So as you guys can see, Maxx has his own coupon codes. It’s personalized, says, “MAXX15”. You get $15 off your order at MVMT. And basically what is happening here is if you use Maxx’s link, yes you get $15 off but he also gets attribution for your sale, and therefore he gets a kickback or commission. Now I don’t know how much he makes off the sale. I’m not a MVMT affiliate, I cannot speak on that. But it’s probably somewhere around 10, 15 bucks per sale. Which is a very nice extra source of income considering how passive it is.
He just has to post one photo like this or make one video and he can continue to earn money off every single sale from that video. And as you guys can see, the power of the internet, the power of scale. This has over 10,000 likes. And you can bet that of those 10,000 likes, the chances of a few people buying a watch using his code are pretty high. Let’s be honest. It’s just math at the end of the day. Marketing is a numbers game. And if you’re getting 10,000 likes, you’re getting 10,000 views, you’re getting 10,000 clicks.
Chances are someone’s buying something and you’re gonna be making commission. So basically those are all my big examples. It’s very simple.
I hope I can show you guys behind the scenes of how affiliate marketing actually works in the real world. And how people are using it to generate large sources of side income that is different. And it’s more effective than just doing Google AdSense. Which is just showing ads.
Just for an example, YouTube only pays two bucks for every thousand views in my experience.
Now this this changes depending on your niche or your industry. But just to put things in perspective. If Maxx sells one of these and he makes $15, just think about the amount of views he would have to get to make that same amount of money from one sale of selling one watch. So really less is more. You don’t have to sell as much. You don’t have to get as many views.
But if you get sales you get more commission than getting thousands upon thousands of views. But obviously if you have both then it’s a win-win for everybody. Multiple streams of income always the way to go. Alright guys so that wraps up this video. I hope you guys found value in this free lesson. And if you guys like the video please thumbs up the video and leave a comment below letting me know because I really appreciate it. And it will allow me to continue to make more videos and free lessons just like this.