Affiliate marketing is kind of a third party marketing in which you tend to promote other party's product based on your marketing skills through the affiliate networks. And if people actually buy any product based on your recommendation you will get paid. This can be done by placing other brand's product ads on your website and then if the audience gets redirected from your website you will be paid if they actually are converted into a customer. It is totally based on revenue sharing.
If you think that your product is a brand and people would be happy to buy it if marketing is done properly then you can hire an affiliate marketer who will sell your product and you can pay a fixed commission to him or you think you don't have a product then you can be a affiliate marketer, using your skills you can promote and sell other party's products based on a fixed commission.