Affiliate and Referral Marketing

Affiliate Marketing and Referral Marketing are similar in that in both you get paid a commission when you endorse a product of a company and then the person you endorsed to buys the product of the company you are endorsing.

The difference is that Affiliate Marketing is purely online and requires you to embed a clickable link to your website or social media account. When this clickable link is clicked by the person viewing your website or social media account they are taken to the product website page of the company advertising the product for the final sales process where they decide to buy or not.

Referral Marketing in the meantime requires you to personally log your details with the company you intend to endorse a client to. You also need to log the details of the person you are referring to the company. The company then initiates the sales process to the person you endorsed citing you as a referral source.

You should be aware that your reputation and the relationship with the person you endorsed the product is on the line. There are affiliate and referral marketers who become greedy due to the high commission rates offered and therefore income being promised by dodgy and hard to sell products and services by some companies.

They can initially make good money by endorsing these bad products but after their reputation gets ruined online due to negative comments about them and the products and services they endorsed they ultimately lose more business. The relationships that they built with their clients either personal or business wise can disappear too.

Amazon used to be a favourite among affiliate marketers but since they severely cut their commission rates the profit of many affiliate marketers have been severely reduced too. Many gambled on alternative companies to Amazon but found that they are not as reliable as Amazon and can be downright dodgy such as not paying the affiliate marketers the commission due them.

Affiliate marketing and referral marketing can be a lucrative business but as Amazon has shown you are at the mercy of the company with whom you are endorsing the products to your clients. It is advisable to also have alternative source of revenues such as income from displaying ads in your website or social media account.

Many sources online would have you believe that the main difference between affiliate and referral marketing is that in affiliate marketing you preferably must be a customer of the product you are endorsing but do not have to be. These people would tell also that in referral marketing you would have to be a customer of the company you are referring to become a referrer yourself.

This is simply not true. I have seen companies with referral marketing campaigns online that do not require you to be a customer first before being able to refer people you know to them. As I have previously discussed these companies just need your contact details as well as the contact details of the person or company you are referring to access their referral program.

Most of these affiliate and referral marketing campaigns by these companies usually pay a one off fee for endorsing clients to them. Those that repeatedly pay when the client you endorsed repeatedly makes a purchase is quite rare but can be profitable. Try to see the fine print in the contract if the companies you are planning endorse does this. This could be a big boost to your income from them.

Conclusion

Make no mistake affiliate and referral marketing is a sales job. Although you are not directly a sales employee of the company your income success is directly linked on how you can sell the company’s products or services. It is advisable that you know as much as possible about the product you are endorsing to better sell it well and therefore earn well too.