Differences in Affiliate Marketing and Multi-Level Marketing
There is one intriguing question that I still can’t answer until now: what is affiliate marketing? Then try to answer, what’s the answer? For years I tried to find out the answer to that question. It will be even more difficult if the one asking is someone who doesn’t understand affiliate marketing at all. And it will be annoying when the time comes for that person to equate what I do in affiliate marketing with Multi-Level-Marketing.
Actually it can’t be wronged too, affiliate marketing is developing in many big countries. Especially in a country where the internet is very advanced. This is the first fundamental difference, affiliate marketing can only be used in cyberspace. How about the store reseller? Wait, that will be discussed next time. Now with MLM first.
From the first time you set foot on internet marketing, said affiliate marketing is not an easy thing to talk about. The easiest is PPC Marketing (Pay per Click), Email Marketing, Search Engine Marketing, Social Media Marketing, but try to find the right term, which consists of 2 words for affiliate marketing, it’s not as easy as imagined.
Maybe because for me, the word affiliate means being bound by rules, which is more fitting to be associated with cooperation between two organizations (B2B), and not affiliation as referred to in affiliate marketing (B2A2C). Maybe because affiliation is more like a noun. Be quiet, and don’t move. Meanwhile, in my opinion, affiliate marketing is a verb. Whole and cannot be separated. That is, the words ‘affiliate’ and ‘marketing’ must be one. So you get the ‘+ ing’ ending, which means a verb. Dynamic.
For me, maybe Referral Marketing is far more appropriate (and more understandable), or if it’s even more common, it’s called Performance-Based Marketing. But again, what’s the meaning of a name. The important thing is to understand and understand the meaning. After that, please take the positive benefits.
You May Like This Too
- Best Size and Format of Banner Advertisements for Businesses
- Advertise Your Business With Froggy Ad #2
- Want to Make Money from the Internet? This is the Way
Well, back to basic. So what exactly is Affiliate Marketing and what is the difference between Multi-Level-Marketing? One of many is below:
- As mentioned earlier, affiliate marketing only happens in the internet world. This is because this type of marketing system requires an automatic detection system from every incoming referral. This system is usually injected with a cookie platform, which will leave a trace on the visitor’s computer. It’s easy: Have you heard of Wego? Wego is a website that serves flight and hotel ticket reservations. Try to get into it. There will be a price comparison between other websites (see picture). If you finally decide to book a hotel room through Agoda with the link provided by Wego, Wego will get 6% -9% of every purchase you make. Well, because there are still cookies (traces) that are pasted from Wego on your computer. Even after 20 days you book a room again through Agoda, Wego will still get the commission. That is the function of cookies on Agoda installed for 30 days.
- What about MLM? Even though it started with an offline system, now MLM has begun to explore the online system. Oriflame products sold by online for example. Frankly I am amazed by the MLM marketing system that is combined with this affiliate marketing system, and is done online. But still there are fundamental things that must be met when we talk about MLM. That members (commonly referred to as downlines), still have to buy a number of goods to the company, before then trying to find another downline (who will also buy goods from the company. For me, the MLM system is more appropriate by targeting ‘influencers’ and not ‘end users’ This influencer will tell stories, make meetings, receive orders and maintain downlines so that they remain loyal with various bonuses.
- Although not necessary, an affiliate marketing system will require an intermediary company as a Marketplace / Affiliate Network. This does not apply to Amazon which manages its affiliate system. Even Apple, the company founded by Steve Jobs, appointed Commission Junction to work on its affiliate hardware system, and Link Share for all of its applications. The advantages of using this Affiliate Network so that Apple does not bother to look for affiliate marketers who will promote the product. Affiliate Network usually already has a network of affiliate marketers incorporated in it. Imagining Marketplace / Affiliate Network is like: Grocery stores. The product brand is an advertiser. They come to the grocery store to put the items. Then the buyer comes (Note: in the Affiliate Network / Marketplace we don’t have to buy goods to promote). This buyer will resell the advertiser’s item in his shop to reach the end-user. Asiknya, buyers at the grocery store, can buy (promote) a variety of goods in the Wholesale Shop customers. Just choose it. There are various brands from various advertisers. Buyers here are usually called publishers / affiliates.
- Slightly different from the above, MLM only sells products from one brand. However, this brand usually has a broad diversification of product lines. One brand, but the products can be hundreds, even thousands. From here the owner of the brand gets money. From every purchase made by a downline. The focus of MLM is to recruit as many downlines as possible to be able to play with multiples / quantities.
- Affiliate marketing is not a ‘set and forget’ business. It’s OK if you play with ‘content locking’, it might still be quite calm, but still the content on the web must be updated continuously in order to get enough new visitors. We must actively promote existing products through various channels. There is no downline that will continue to promote when you sleep so you have to keep control of your promotional activities. The focus of the affiliate marketer is to find an end-user, while the owner of the item will focus on finding the Affiliate Network that is most appropriate for him.
- Although many MLM players oppose it, in this business, to some degree, you will also feel ‘set and forget’. Like when your downline works hard to find another downline. At a certain level, your children will be able to work (without them knowing) for the upline. A percentage of commission goes to the upline. The task of the upline is to maintain motivation and enthusiasm in the group. At this level, the ‘influencer’ task is evident for successful uplines. In some cases, the MLM system is now used by various insurance companies. They are no longer looking for customers who buy premiums, but are looking for recruiter who is able to recruit more downlines.
- Now, when it comes to the product level, there are clearly many differences. In affiliate marketing, even though the product can vary, advertisers have different goals with the product. Insurance companies, mostly looking for leads (email and zip) to then be followed up with a different approach. For example, insurance companies register insurance products to the Affiliate Network. The goal is to get leads (highly targeted traffic, usually in the form of emails and postcodes that are entered voluntarily from visitors). So, affiliate marketers must be able to capture leads (not downlines) as much as possible to be able to get money. Yes, one visitor who enters his email and postcode, affiliates will get a number of dollars. Seems easy huh? Believe me, it’s not as easy as imagined. Other companies, products are skin care for example. What they are looking for is trial. So the visitor enters the data to send product samples from the skin care company. So what the affiliate is looking for is how to make visitors willing to provide data and then send product samples. Every data that comes in, the affiliate will get a commission amount of money. All this is done on the internet. Affiliate marketers do not have to meet with end-users.
- Slightly different, MLM depends entirely on the credibility of the influencer. Here sometimes what makes people rather retention of the MLM system. The reason is because: you can’t sell, you don’t have many friends or don’t sell goods to your friends. Once again, because the system is targeted incluencer, the recruits must remain familiar with the influencer. The system is built by getting to know each other and building trust in it. Motivating each other becomes important.
The eight differences above may still be a little with what you find. Another fundamental difference is: MLM is how to manage people, while affiliate marketing is managing products. Obviously very different.