How Affiliate Marketing Works

So, let’s get a little more technical, shall we? How precisely does affiliate marketing work and why would a creator ever be happy to give away so much of their profits?
First, let’s consider the type of content you will be selling. To many marketers, affiliate products will be digital products. There are plenty more options, which we will explore in this book later. But for now, that’s what we’ll focus on. That means things like eBooks, online courses, and presentations.
Digital products are immediately a good choice for selling online because they have zero overheads and no ‘COGs’ (this is a business term meaning ‘Cost Of Goods Sold’. That means that the creator doesn’t have to pay out at all for each sale and they can instead just make a profit and share that profit. It also means they never had to invest large amounts of money upfront and they don’t have to handle delivery either.
So, the creator likely made this digital product themselves using Word or a camera, or perhaps they outsourced the creation to someone else. Either way, they will have built this ebook or course to sell it for profit.