How To Create a Healthy Income Stream Through Affiliate Marketing

The Small Business Encyclopedia defines affiliate marketing as “A way for a company to sell its products by signing up individuals or companies (“affiliates”) who market the company’s products for a commission.” Every time someone makes a purchase or signs up for a service or event from the business, the affiliate earns a percentage of the fee.

Income stream through affiliate marketing

See also: You might benefit from creating an LLC for your affiliate business.

Although some people use the terms “passive revenue” and “affiliate marketing revenue” interchangeably, use caution when reading online blogs and reviews. Not all affiliate programs are created equal and not all passive revenue streams are really passive; many require consistent monitoring and lead generation activity in order to make money.

Here’s how to create a healthy incomes stream through affiliate marketing. But first…

What is affiliate marketing and is it right for me?

In a nutshell, the basic premise behind affiliate marketing is that you can earn a steady stream of income with just an Internet connection and a bit of ingenuity. You don’t have to come up with a new-to-the-market innovation or find investors to fund your startup. Instead, you market other products or services in exchange for a commission.

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The benefits include the fact that it’s fairly quick and simple to set up and get going, you aren’t required to have marketing experience (most programs will take care of the marketing themselves), they’re free to join and you don’t have to buy any inventory, and you can put as much or as little time into it as you want. Also, because affiliate programs come with a built-in audience, you can reach a larger audience yourself.

Affiliate marketing is an opportunity to set your own schedules and work at achieving your own goals, but don’t let that lure you into thinking that a healthy revenue stream happens overnight without any real effort on your part.

Before you quit your day job, do some due diligence.

There are countless affiliate marketing opportunities out there. If you type “affiliate marketing” into Google’s search engine, you’ll get a list of more than 14 million results, many of which are companies trying to sell you their amazing formula for success via an e-book, video series or subscription. As you’ll see, the top few results (or those on the sidebar) are paid ads for affiliate programs, which is how these particular companies generate income through “passive income.”

It would be impossible to evaluate every affiliate program before you test the waters, but you should definitely read the Terms of Service agreements before signing up for just any program. Some companies pay a click fee, others only pay when a transaction results in a sale, and still others pay for subscriptions and renewals.

Another important detail to check is how long the cookies stay active once a visitor clicks through to the original seller. Amazon cookies are only good for 24 hours. That means that if your visitor clicks through but gets interrupted and goes back a couple of days later to finalize a purchase, you probably won’t get any commission unless they return to your site first. Now, let’s move on to the five steps to start generating affiliate revenue streams.

1. Compare companies.

The first thing you’ll want to do is check out prospective companies’ conversion rates, long-term income potential, refund rates, commission payment schedules, and online reviews from independent sites. Ana Hoffman, from Traffic Generation Café, recommends you also look for opportunities to:

  • Capture recurring fee commissions
  • Offer multiple high-quality products from the same company
  • Recommend niche market consumables/services (not mainstream)
  • Generate lifetime commissions for any purchase your referral makes

Amazon Associates has been around since 1996 and has a diverse inventory of products to consider, so this could be one good place to start. Another company,, is similar to Amazon Associates, but this company does much of the work for you, including linking to mentions in your blog posts. Visit their site to take a free test drive.

2. Learn from the experts.

Read affiliate guru blogs. Not sure which bloggers to follow? This Search Engine Journal article lists ten bloggers with proven affiliate marketing track records who share their advice, such as always be ethical and transparent, only recommend products that you’re familiar with, always brand your email, use anchoring techniques, and understand that this is not a get-rich-quick tactic.

3. Build a relevant blog.

If you want to market niche products, you need a blog that publishes relevant content. For example, if your blog is all about custom sewing services for theater companies, ads for tractor parts don’t make sense. Imported fabrics, finely crafted scissors, and specialty needles fit your niche service industry. You should be following industry experts in your “passion field” to get a feel for interesting topics for your blog posts on which you can advertise affiliate programs.

4. Market products you believe in.

Generating income won’t be easy if you don’t have confidence in the products attached to your links. Your reputation depends on your followers’ experiences, so before you link to a new product, try it out yourself. Check out the transaction journey from browsing to delivery. Does the product do what it claims it will? Is the company easy to contact if you have a problem? Was the checkout process smooth? If you have a poor buying experience, or the product doesn’t perform as expected, you don’t want to offer this option to your web visitors.

5. Test. Test. Test. Repeat.

What works for some affiliate markets doesn’t generate a steady income stream for others. Test your social sites to find out what type of articles resonate with your followers. Test ad placement. Banner ads entice some page visitors while the right-hand sidebar and below the fold ads generate more positive results for others. Tweak colors and fonts. Consider A/B testing if you’re using email to generate leads. Email subject lines should follow a “best rule,” which means that your title has fewer than 45 characters, includes an action word, and uses six words or less.

If there’s one key takeaway here, it is that “authentic selectivity” is the key to success. Although successful professional affiliate marketers don’t use that term, they all follow the principle behind authentic selectivity. Invest the time necessary to know your audience intimately, then give them what they expect. Be genuine, respect your web visitors, and market products you have confidence in. Then, get out there and draw the right people in with the right products, and watch your income stream steadily grow!

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