Is Affiliate Marketing Legit? How Brands Get Started & Reduce Risks

Although the affiliate channel is well established, some people still question its legitimacy. Here’s what to watch for if this is your brand’s first foray into the affiliate space.

Affiliate marketing has come a long way from basic referral links.

Today, the channel encompasses a diverse array of publishers, influencers, brand ambassadors, and subnetworks, all playing a crucial role in driving sales and enhancing brand visibility for businesses of all sizes.

As the affiliate marketing industry rapidly expands, it often appears to be an easy way to generate revenue. Consequently, many brands are eager to explore its potential and understand the best ways to leverage it to accomplish business objectives.

However, this lack of understanding can sometimes lead to hesitancy, resulting in missed opportunities within a well-established and legitimate marketing channel. At the same time, rushing into something without full comprehension carries its own risks.

In this article, we guide you through what to look out for and what to avoid as you venture into the channel.

Is Affiliate Marketing Legit?

Yes, affiliate marketing is legitimate. It’s an incredibly effective way to reach a broader audience and boost sales in a cost-controlled manner. The affiliate channel, when managed properly, is a proven and trustworthy marketing strategy.

By partnering with affiliates, businesses can access a large network of marketers, publishers, bloggers, and influencers. These partners promote the business’s products or services in return for commissions.

Affiliate marketing is a performance-based strategy. It helps both the business and the affiliate. Both parties are rewarded for real efforts that lead to actual sales.

However, like any growing industry, affiliate marketing has its dark side. Unethical practices, such as affiliate fraud and scams, are on the rise. Despite these risks, with proper safeguards, affiliate marketing remains a powerful tool for legitimate business growth.

That all said, it’s typically not recommended to foray into the affiliate channel on your own.

Affiliate marketing is not DIY.

Affiliate marketing may seem simple on the surface, but it’s far from a do-it-yourself (DIY) endeavor. The legitimacy of an affiliate marketing program depends on strategy and performance analysis.

While many affiliates may be independent influencers, editors, and entrepreneurs, the businesses that leverage these connections require a greater level of expert management. This is where partnership with a trusted affiliate marketing agency comes in.

What makes for a successful affiliate program?

Successful affiliate programs require a strategic approach, ongoing management, and specialized expertise.

Building relationships with affiliates and optimizing campaigns can be complex. This process can overwhelm those who lack experience.

Affiliate success is about more than signing up partners. You also need to build strong, helpful relationships that fit your brand’s goals.

What do you need for effective affiliate program management?

To manage an affiliate program effectively, managers need to persistently scrutinize content, negotiate contracts, and implement data-driven tactics.

Without a dedicated team or expert guidance, these tasks can be time-consuming and inefficient. Affiliates need regular communication, guidance, feedback, and support to stay motivated and aligned with your objectives.

You also need to track key metrics, analyze data, and adjust strategies to keep your program profitable.

What are the risks of DIY affiliate program management?

Attempting to manage affiliate marketing programs as a DIY project can lead to missed opportunities, poor affiliate relationships, and weak performance.

Working with experienced professionals or affiliate management services ensures you optimize your program for success. This method lets you concentrate on building your brand, leaving the details of affiliate marketing to the pros.

An agency can help you determine effective steps to start your affiliate program and minimize the risk.

How do brands make money with affiliate marketing?

As mentioned, affiliate marketing is a full-fledged marketing channel. When done right, businesses can reach targeted audiences in a more personal and engaging way.

According to Influencer Marketing Hub, global affiliate marketing spend reached $14.3 billion in 2023. As of this writing, it’s expected to grow to $15.7 billion in 2024.

Here at Gen3 Marketing, we take a 12-step approach when managing affiliate programs:

1. Build a program for launch across the best suited affiliate networks for your business.
2. Develop a strategy and budget to guide affiliate marketing efforts.
3. Negotiate key terms with affiliate networks to maximize profits.
4. Manage and nurture relationships with top affiliates.
5. Assist in the integration and administration of your affiliate program.
6. Recruit targeted affiliates to represent your brand effectively.
7. Optimize affiliate partnerships with strategic, goal-oriented plans.
8. Approve new affiliate partners based on brand-specific criteria.
9. Oversee the ongoing daily management of the affiliate program.
10. Analyze performance trends and total channel insights.
11. Report regularly on milestones, sales, recruitment, and return on investment (ROI).
12. Test innovative promotional tactics and apply learnings for continuous growth.

To fully leverage affiliate marketing strategies, marketers rely on specialized data. Affiliate experts should also routinely pursue certifications and stay current with industry developments to deliver effective, results-driven campaigns.

Over the decades, Gen3 Marketing has gained access to a breadth of data unavailable to any other agency. Our far reach means world-class relationships and a deep understanding of these networks.

When is affiliate marketing worth it?

Affiliate marketing is worth it when you have a scalable product or service and a well-defined target audience.

Your business will also need the resources to support the start of your program. This is typically outlined by your agency and affiliate manager.

Here are a few example scenarios where an affiliate marketing program is a great fit.

A clothing retailer with difficulty managing their own program. Affiliate marketing helps this type of business streamline relationships, maintain a positive brand image, and improve revenue goals.

A financial services company seeking to expand its customer base. Affiliate marketing can target specific niches, driving leads and sales through tailored content and expert recommendations.

An outdoor kitchen appliance company with low brand awareness. Partnering with high-quality publishers can rapidly spread awareness and drive conversions around holidays and events.

Affiliate marketing becomes especially valuable when your brand is looking to expand its reach with performance-based partnerships that drive conversions.

With the right strategy and partners, affiliate marketing can yield a high return by efficiently generating new leads and sales. (We have plenty of our own expert case studies to support this.)

Is there a downside to affiliate marketing?

When working with a qualified agency, there typically aren’t downsides to affiliate marketing.

However, improper management can amplify the risks that stem from a lack of data, education, or experience:

• Over-reliance on a small number of affiliates, which can lead to brief short-term gains.
• Fraudulent results, which require meticulous attention with traffic analysis.
• Legal violations, which are diverse and based on each country’s laws.
• Time sinks, which may not be discernable to newcomers of the industry.
• Negative reputation risks, which can be wholly avoidable with the right expert guidance.

The best agencies will help you navigate these obstacles. True experts maintain affiliate compliance while managing a healthy affiliate program that maximizes your return on spend.

How do you protect your program from common affiliate marketing risks?

To ensure your affiliate marketing efforts remain legitimate and profitable, it’s crucial to implement a fraud mitigation plan.

Fraud prevention tools can help find suspicious activities. These include high traffic from one source, click spam, or fake leads. Regular audits of affiliate performance, alongside setting clear rules and expectations for affiliates, will minimize the risk of scams.

Partnering with an experienced affiliate marketing agency can be a game-changer. With years of industry expertise, Gen3 specializes in identifying and combating fraudulent activities while optimizing affiliate programs to achieve the best results.

We have seen the rise of common fraud tactics and, in response, have developed methods to secure legitimate, high-quality affiliate partnerships.

Improve your affiliate program and reduce risks. Partnering with Gen3 Marketing starts with a simple email. Contact us today.

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