Affiliate Marketing: Is It Legal?

I have played the ‘money game’ for over thirty years, as a venture capitalist on Wall Street, as an offline entrepreneur, and as an affiliate marketer. I can honestly say that affiliate marketing is the closest thing to stealing that I have ever seen, but affiliate marketing is 100% legal and you will never risk going to jail.

One of the best things about affiliate marketing is that it’s quick and easy to learn. There’s no need for special tools or fancy equipment, all you need is a laptop, and you can do it at home, while enjoying a cup of coffee at Starbucks, or even while you sleep!

It definitely sounds too good to be true, but again let me assure you that it is not. Keep reading to know more!

So what is affiliate marketing, anyway?

Companies that offer goods or services on the Internet generally establish what are known as “affiliate programs.” These online companies (advertisers) offer commissions to third parties (publishers) who send interested people to the company’s website. If those people make a purchase, the advertiser pays the publisher a sales commission, which can range from 5% to 75% of the product price, depending on the item.

Simply put, affiliate marketing is a process of identifying companies that offer affiliate programs, signing up for the program, and then sending potential customers to the company’s website. It’s extremely easy and potentially very lucrative, so much so that millions upon thousands of people make five, six and even seven figure incomes using affiliate marketing techniques.

The key that makes affiliate marketing a potentially lucrative business is the ease with which systems can be fully automated.

How does it work?

So, a company that offers a product or service online establishes an affiliate program. They will decide how much commission to offer and set up an affiliate system that will automatically generate “affiliate links” – website addresses that contain a tracking code. Each individual affiliate receives their own unique tracking code, which allows the business to track sales and commissions automatically.

When you sign up for an affiliate program and receive a tracking code, you can create an affiliate minisite that tells people about your affiliate products. With your site created, you can use Google ads and other means, such as email or article marketing, to drive traffic to your site.

Visitors to your site read the material you’ve provided about your affiliate products, click your affiliate links to go to the company’s website, and hopefully purchase the products you advertise. With each purchase, you receive a commission from the company.

It really is that simple, and that is why many people wonder if affiliate marketing is illegal. The truth is that most Fortune 500 companies have 100% legal affiliate programs that you can participate in.

The technological hurdle

The only hard part of affiliate marketing is creating websites for the affiliate products you sell. There are many techniques and technologies that you will need to master to get a website up and running and make money, such as:

• web hosting
• HTML, PHP, mySQL, javascript, etc.
• headline generators
• Email autoresponders
• traffic monitoring
• Split testing and conversion measurement
• audio and video manager
• credit card processing

And more…

All of this is why most new affiliates take a year or more to create their first website and start making money. Most new affiliates have a small budget, so they decide that they will learn to do all these things themselves, without the help of a webmaster (which costs money). This means that they spend 90% of their available time trying to master the technology and 10% of their time increasing traffic and conversion rates. Unfortunately, however, they should be doing the exact opposite!