How Affiliate Marketing Works – A Step by Step Visual

Recently I've been doing some articles aimed at the beginner affiliate – like how you can avoid affiliate marketing scams and how you can find reputable affiliate programs to promote.

After spending over a decade in the Internet marketing industry, I think I often forget – and have failed to address – the most obvious question most folks new to the industry have about affiliate marketing.

I appeared as a guest on Weapons of Mass Marketing earlier this week to discuss the topic of marketing affiliate programs. The hosts evidenced the importance of the often overlooked question by leading off their interview with:

What is affiliate marketing?

So with the help of a talented designer I was able to develop a clear, step by step graphic showing how basic affiliate marketing works. (Click on the image below for a larger version.)

How Affiliate Marketing Works

Spread the word

You're welcome to use the above graphic on your website, providing you credit me ( as the source and do not alter the image. Below is HTML code below to easily embed the graphic on your blog or website:

Get this graphic in poster size

The infographic above is available in high quality poster format via Zazzle for $27. All proceeds from the poster sales go to the Stroke Walk to help fight childhood stroke. Get it now!

How to get started in affiliate marketing

Now that you know what affiliate marketing is, find out how you can take a stab at it. You should also sign up for my free newsletter here.


Rae Hoffman aka "Sugarrae" is a veteran digital marketer and SEO consultant. She is also a serial entrepreneur. You can find out more about her entrepreneurial efforts here. Rae is most active on Twitter.


  1. Nathan OLeary on May 13, 2011 at 9:29 am

    Great visual of how affiliate marketing works! I will be sure to share this with my new affiliates when they sign up. Many of them sign up because they know they want to be an affiliate marketer but still don’t know what it actually is.

  2. geobak on May 13, 2011 at 11:16 am

    Nice graph. Easy and simple for everyone. What I like more though is the link with the “affiliate marketing blog” anchor at the html code. Nice move to get a little bit more link juice. Kudos

  3. Andy Hayes on May 13, 2011 at 9:46 pm

    Wow – great infographic! I love it. I’m trying to think of any examples that don’t use cookies but can’t think of one off the top of my head.

  4. Debbie Summers on May 15, 2011 at 6:19 pm

    Love the graphic! Haven’t seen a better explanation of how affiliate marketing works.

  5. Nikki Pilkington on May 16, 2011 at 8:44 am

    Thanks Rae – have posted this on my blog and made a note to send everyone who asks me about affiliate marketing a link :)

  6. Phil on May 24, 2011 at 2:52 am

    thanks for the infographic!
    I work at a digital marketing agency and not all my colleagues uderstand affiliate mkt fully (it will depend on the department they work in), so I printed it out and passed it around the office and shall be recommending your articles to them. Thanks!

  7. Karen Young on June 15, 2011 at 5:03 pm

    This is the first time to your site and I am delighted I found you. I am an article writer that has written so much about affiliate marketing, network marketing and all aspects of IM, I decided to start my own website to try and help those who are new to the business.

    I am definitely going to be using your network marketing diagram for my site and I will be back often! Thank you.

  8. Duran seo on June 26, 2011 at 12:32 pm

    i think that the biggest problem in affiliate marketing is that not many companies give really good accessories such as lead forms, buy now buttons ETC, that people can plant in their sites.

    The affiliate links usually cause a big drop in conversion rates.
    if more companies invested in their tools, i believe that it would come out as bigger income for both sides.

    meanwhile there are a few companies that even offer a white label which in my opinion is the most powerful way for the highest conversion rates.

  9. Oracle on August 2, 2011 at 6:04 am

    Hmmmmm….what a means of driving home the teaching, info-graphic indeed. You are a genius, keep it up.

  10. Petter on August 10, 2011 at 10:57 am

    This was the best post on how affilliate marketeing is working!

    Thanx for sharing!
    Especially the picture!

    It will help me explaining it to my friends….

  11. Andrea on May 10, 2013 at 12:43 pm

    Thanks so much for the information. I am just starting out and you made what affiliate marketing is easy to understand

  12. Camille on July 19, 2013 at 7:11 am

    Many people have their systems set to not allow cookies…. How does that affect things?

    • Rae Hoffman on July 22, 2013 at 11:10 am

      The number I’ve heard has always been closer to 30% overall (some browsers are higher, some lower) and this refers to THIRD party cookies. When a user sees your affiliate link and clicks on it, the cookie that is set is a FIRST party cookie, which is different.

  13. Oliver Carlin on August 11, 2013 at 9:41 pm

    Love the image explain affiliate marketing Rae! I think I will take you up on it and make a post with that image in it.

    It’s good to understand how affiliate marketing works. Most people don’t realize that a lot of people actually make more money with this than with network marketing.

    Great work!

  14. davy pelssers on February 11, 2014 at 2:58 pm

    great post / great explanation, but what I miss in the picture is the potentially involved BROKER or advertising company like clickbank/commission junction that also are often involved in the affiliate marketing process and usually take a commission in this whole affiliate marketing process.

    I will be using your picture but add that fourth party in the picture to be more complete :-)

    nice blog ! will be back


    • Rae Hoffman on February 12, 2014 at 9:18 am

      To me, the network is the same as software running an affiliate program in the above. Their just a method within the process – if that makes sense?

  15. Marisa Dana on May 8, 2014 at 12:24 pm

    Great graphic!! There is an online affliate marketing business opportunity that seems to be pretty comprehensive. They manage all of the affliate merchants for me and I leverage an online portal to send customers through. And I can link that portal to my blogs, facebook page, twitter, etc. They manager over 3,000 partner stores and it seems to be growing everyday. Pretty cool so far. I love to shop online so this was a great business opportunity for me. And they have their own brokered products too. I think affliate marketing is just going to keep growing as businesses go from brick and mortar to click and order!