The affiliate marketing industry is projected to reach $28 billion by 2027 (Authority Hacker). With the Artificial Intelligence (AI) boom, this market is set to explode as businesses rely on trusted voices and personal branding to stand out in an increasingly automated world. AI tools are flooding the market, but users crave recommendations from real people—not just algorithms. This makes affiliate marketers more valuable than ever.

Here, we’ll share a full step-by-step guide to affiliate marketing, covering:

• What is affiliate marketing

• How does affiliate marketing work

• How to get started in affiliate marketing

What is Affiliate Marketing

Affiliate marketing is a process where you, the affiliate, earn a commission by promoting a company's product or service. Here's how it works step by step:

1. Merchant (Advertiser): The company that owns the product or service. Merchants create affiliate programs to expand their reach by leveraging affiliates to promote their offerings. For example, one of the largest affiliate programs is by Amazon, called ‘Amazon Associates’.

2. Affiliate (You): Individuals, influencers, or businesses that choose products to promote and earn a commission when someone makes a purchase through their affiliate links.

3. Customer: They browse content, see recommendations, and make purchases through affiliate links, all without extra cost. Merchants will pay you a commission upon purchase.

How Affiliate Links Work

Tracking links are what make the entire affiliate system function.

When an affiliate joins a program, they receive a unique affiliate link for each product. These links contain data that tracks where each sale comes from, ensuring the right affiliate receives credit.

The link tracking systems monitor clicks for a certain period of time, from 24 hours up to months. Meaning, you could promote a product, and even if someone buys it weeks later, you still earn a commission.

How Affiliates Get Paid

There are three main payment models in affiliate marketing:

1. Pay Per Sale (PPS): You earn a commission whenever someone purchases through your affiliate link. This is the most popular model.

2. Pay Per Lead (PPL): You get paid for every lead generated, even if no purchase is made. This is one of the best options for creators because you're not responsible for making people buy the product.

3. Pay per click (PPC): This is commonly used by ad networks. Here, you earn money for each click on your affiliate link, regardless of whether it results in a sale or lead. Payouts for PPC are usually lower than other models.

To illustrate the potential earnings, consider a brokerage app that once paid $300 for every new sign-up and investment. In contrast, lead generation pays around $5 to $10 per lead, while PPC typically earns just a few cents per click. The effort required varies accordingly, as does the income potential.

How to Get Started in Affiliate Marketing

1. Choose Your Niche

Your niche is the area you’ll be focusing on, where you’ll grow your audience and eventually share your affiliated products or services.

• Specificity is key to standing out from the internet noise. Think about your niche like a funnel, where the narrower it is, the more engaged your audience would be and better it is for SEO. For example, instead of approaching a broad niche like education, go for narrower angle like ‘building AI agents for beginners without coding experience’

• A ‘good’ niche is one that you enjoy doing and/or good at, this way you can go far and build an engaged audience easier. Ask yourself these:

  • What am I good at?

  • What do I enjoy doing?

  • What am I curious about?

  • What do other people tell me I’m good at?

• Popular niches as below. Look for trending niches or those with steady demand since affiliate payouts vary significantly.

• Top niches by average affiliate income include: Education and E-learning, Travel, Beauty and Skincare, Finance, Technology

Average Monthly Affiliate Income by Niche’ image by Authority Hacker

By carefully selecting a niche and strategically approaching brands, you can establish a steady affiliate income stream easier.

2. Choose Your Platform

Ask yourself:

• Where does the audience in your niche hang out?

• Where do they actively seek for solutions to which your affiliated product or service serve?

Different platforms cater to different audiences and content formats. Choose based on your niche and marketing style:

Pro tip: Consider getting started with social media for fast and wide content distribution. Also, leverage on in-app affiliate shopping features which directly link to products for easier conversion.

3. Research and Join Affiliate Programs

To start, look for affiliate programs related to products you already use and recommend. Remember, people buy from people and brands they trust.

Where you can look for affiliate programs:

• Search engine like Google (eg. ’Amazon affiliate program’)

• Affiliate marketing sites like this (www.ai-affiliateprogram.com)

• Companies with affiliate marketing programs would have a website tab (eg. ‘affiliate program’)

When choosing an affiliate program, evaluate the following factors:

1. Commission Structure and Payouts

• Commission Rate: Higher commissions mean more earnings per sale. Compare flat fees vs. percentage-based payouts.

• Recurring Commissions: Programs that offer recurring payments (e.g., SaaS subscriptions) provide ongoing income.

• Payout Threshold: Some programs require a minimum balance before withdrawal. Ensure it's reasonable.

• Payment Methods: Check if they support PayPal, bank transfer, crypto, or other preferred methods.

• Cookie Duration: Longer cookie durations increase your chances of earning commissions from delayed purchases.

2. Product and Brand Reputation

• Market Demand: Promote products with high demand and a strong customer base.

• Brand Trustworthiness: Partner with reputable brands that customers trust, ensuring higher conversion rates.

• Refund and Chargeback Policies: Avoid programs with high refund rates, as chargebacks may deduct from your earnings.

3. Competition & Earnings Potential

• Industry Competition: High-paying niches like finance and tech are lucrative but competitive.

• Program Reputation: Avoid affiliate programs with payment issues, poor tracking, or negative reviews.

• Restrictions: Some programs only allow specific marketing channels, geological locations and exclusivity.

Pro tip: Diversify your earnings by joining multiple programs, but focus on those that align best with your audience and expertise. If you’re just starting out, look for affiliate programs suitable for beginners. Some platforms require applications and approval. Prepare to track your applications.

4. Create Quality Content

Create content based on research and personal experience: Create reviews, comparisons, and tutorials.

• Effective formats include reviews, comparisons and tutorials; which can be presented in the form of talking head videos, lifestyle hacks, reels and blog articles

• Remember to disclose affiliate partnerships as this builds trust and ensures compliance with FTC guidelines

Pro tip: Recommend products you naturally discuss with friends and family.

5. Test and Optimize

Data is key. Regularly analyze purchasing trends. Affiliates who optimize monthly see a 15-20% increase in earnings.

• Optimization tips:

  • Review performance monthly.

  • Remove non-performing products.

  • Replace discontinued affiliate programs with competitors.

  • Optimize SEO on underperforming posts.

• Start with achievable goals: aim for your first 10 sales or $100 in earnings to build momentum.

Final Notes

Affiliate marketing is a long-term strategy that rewards persistence. Many beginners give up too soon, but the most successful affiliates stay committed for years, refining their approach and scaling their efforts.

To succeed, shift your mindset: passion is valuable, but treating affiliate marketing like a real business—strategizing, delegating, and optimizing—will set you apart. Remember, over 50% of new affiliates quit within six months, yet those who stay the course often land the most profitable deals.

Stay patient, stay consistent, and you’ll position yourself for long-term success.