Affiliate marketing is a performance-based marketing strategy where you earn a commission by promoting another company’s product or service. Or flip it: you let others promote your offerings and only pay when they bring in actual sales or leads.

In short, it’s a win-win model. Affiliates earn money for every conversion they drive. You grow your reach and sales without spending money upfront on ads. It’s popular with bloggers, influencers, niche site owners—and increasingly, small businesses looking for low-risk growth.

How it works

Here’s how affiliate marketing plays out in practice:

1. You (the business) set up an affiliate program with tracking links.
2. Partners (affiliates) sign up and receive a unique referral link.
3. They share that link on blogs, social media, YouTube, newsletters, etc.
4. When someone clicks the link and makes a purchase or signs up, the affiliate earns a commission.
5. You get a new customer. They get paid. Everybody wins.

The commission can be a percentage of the sale (e.g. 10%) or a flat fee (e.g. €20 per lead). Everything is tracked via cookies and affiliate platforms.

Common examples

• A WordPress plugin offers 30% commission to developers who promote it on their blogs.
• A web hosting provider rewards affiliates for every new signup.
• A service-based business pays €50 for each referred client who books a project.

Why affiliate marketing matters for business owners

• Low upfront cost – You only pay when results happen.
• Scalable outreach – You multiply your marketing force without hiring staff.
• Trust-based promotion – People are more likely to buy from someone they follow or trust.
• Diversified traffic – Affiliates bring traffic from niche blogs, YouTube, TikTok, email lists, and more.
• Passive sales – Once a referral link is out there, it can generate recurring revenue.

It’s especially effective for digital products, subscription services, and businesses with well-defined customer journeys.

Tools and platforms

To run your own affiliate program, you’ll need a system to track and manage referrals. Some options include:

• AffiliateWP (for WordPress sites)
• FirstPromoter
• PartnerStack
• Refersion
• ShareASale or CJ Affiliate (for listing your program on affiliate networks)

These tools handle tracking, cookie durations, reporting, and payouts.

Things to consider

• Set clear terms (cookie duration, payout timeline, approved channels)
• Choose the right commission structure (enough to motivate affiliates, but sustainable for you)
• Vet your affiliates—your brand is in their hands
• Monitor for spammy or dishonest tactics
• Support affiliates with promo assets (banners, copy, videos)

Bottom line

Affiliate marketing helps you turn other people’s audiences into your customers—without taking on financial risk. Whether you’re promoting or being promoted, it’s a flexible, performance-driven model that rewards trust, relevance, and results. If done right, it can be one of the most cost-effective channels in your marketing mix.