What is affiliate marketing?

Affiliate Marketing' is an advertising model where a company pays third party publishers (aka affiliates) to generate traffic or drive them towards the company's products and services. When you look up the word in the dictionary, you will find that it is defined as 'marketing arrangements' by which a retailer earns a commission for the sales generated from traffic or referrals to an external website.  

So far, below is one of the best (most humane) definitions I've seen for affiliate marketing. So you find the product of your choice, promote it to others, and earn a share of the profit for each of their sales.

In short, it is actually a revenue sharing system that provides financial incentives to others to help promote your product.

This is attractive to businesses as it allows them to increase the exposure of their products at no cost, as the company only pays when sales occur.

Ingredients of Affiliate Marketing

 affiliate marketing has four components,  

# 1 - Trader

A merchant is responsible for creating and developing a product, be it an individual (like you or me) or a major international company, such as Apple or Avast. Anyone can join the program to sell products and become an affiliate.

 # 2 - Attachments

Affiliate is what helps in the promotion and promotion of the product, basically anyone who knows how to sell can be affiliate (again, just like you or me). Earnings for an affiliate are directly linked to their promotion efforts. The more they promote, the more they can earn, which is a win-win situation for both merchants and affiliates.

# 3 - Network

A network usually acts as a 'middle man' between the merchant and the affiliate. There are many examples of these network websites, western examples include CJ Affiliate and Amazon Associates. These networks are usually the first place where merchants start an affiliate program. (We'll talk more about networks below)

# 4 - Customer

Customers are an important part of affiliate marketing, because more customers means more sales. Without customers, there would be no affiliate marketing because they are the ones that generate revenue.

Affiliate Marketing in the West

According to a study by Forrester Consulting, affiliate marketing spending in the United States is growing at an average annual rate of 10.1%. Excluding these numbers, affiliate marketing spending will reach USD 6.8 billion by 2020

 Affiliate marketing in the West relies heavily on affiliate network platforms. You can visit their websites below to check them out.

In addition to platforms, affiliate marketing forums are also common. The affiliate marketing forum on Reddit has over 15.7k subscribers where people can talk about paid traffic, SEO (search engine optimization), email marketing and more.

In addition, it is common for companies to use influential people as affiliates to increase their exposure. Jason Stone, known as the 'Millionaire Mentor' on Instagram, earned USD $ 7 million in sales between June 2016 and June 2017 of the products he represents on Instagram. He also thinks that the trend of influencing personal brands of influential people as well as selling specific products helps the affiliates to get more sales

Affiliate Marketing in China

Affiliate marketing is a growing industry in China. With the incredible development of its e-commerce platforms, it hopes to become a huge industry in China. There are already several prominent networks that we will introduce below.

Top 5 Chinese Affiliate Network Platforms

 Like the West, affiliate marketing has a vast network in China. Like the West, China has a few different types of affiliate networks. The main differences between these networks are the industries / products / services they focus on and the payment model they operate on. The two most common types of payment methods are CPS and CPA. CPS means cost per sale, meaning you pay the network only when they generate sales. CPA means cost per action, meaning you pay when a user takes a particular action. It could be a user clicking on a link, a user adding something to their cart, and so on.

# 1 Linktech:

One of the largest Chinese affiliate marketing networks. Linktech claims to be one of the top 3 largest Chinese affiliate networks and has worked with some of the biggest brands we all know and love. It was founded in 2004 by a Korean company that succeeded in the Korean market. Since its inception in 2004, it has played a vital role in the development of e-commerce in China. It is also quite friendly to foreign brands (it also has an English website!) Linktech is a real affiliate network that works on the CPS model, in which merchants pay only for performance, which makes it quite attractive. Also makes (However there are some activation fees and if you are interested you can see here what not to start.

# 2 DuoMai  

AMNavigator describes it as a sub-affiliate network, otherwise it is known as CPA network. It is one of the most popular Chinese affiliate networks, although it is relatively new. The network itself acts as an affiliate, and pays publishers to advertise products on their websites and pays them for certain actions, such as clicking on a product page. Publishers who are part of the DuoMai Network receive commissions on sales made through their promotional activity and also state that they can redeem for free gifts on the platform. You need to contact their sales team here for any pricing information

# 3 Chinet  

Chanet means the China Advertising Network claims to work with more than 300,000 websites and connects wannabe affiliates to programs through the platform. Both big and small brands use this platform to get started with affiliate marketing. It originally started in Japan as Janet in 2002, but due to its success it spread to China in 2005. It focuses on recruitment, education, travel, networking, entertainment and e-commerce niches, but also offers more. It is one of the few Chinese affiliate networks that claims to have zero cost which makes it very attractive to newcomers to the Chinese market.

# 4 YiQiFa  

Considered one of the pioneers in Chinese affiliate marketing and one of the first Chinese affiliate networks. Like Duomai, it's a sub-affiliate network, but it's huge. It is a Beijing-based company founded in 2004 and has contacts with more than 600,000 publishers, more than 50% of whom work exclusively with Yiqifa. They also claim that their publishers generate an average of 20 million clicks and over 2.5 million sales per day for products on their platform. This is especially appealing to publishers because it allows them to get started quickly. They can sign up, get their links, and pay through all platforms.

# 5 LinkHaiTao

LinkHaiTao claims to be the first Chinese affiliate network to focus exclusively on cross-border e-commerce markets. It works mostly with multinational brands and also works on CPS basis. With offices in China, South Korea and the United States, LinkHaiTao mainly deals with foreign businesses. While relatively new compared to other affiliate networks, experience with foreign brands makes it an attractive place to start for newcomers to the Chinese market.