Are affiliate markets exist and they can be done profitably?

Affiliate marketing does exist, and people do make money with it.

On the other hand, a large portion of the people that try it make little or nothing.

Yes, to both questions but it is not something that you can set up now and make a livable income tomorrow with. You have to start small and work your way up. Here try this. When you are first starting out, find a niche you are interested in and that is profitable. Lets say you like golf. Ok go to clickbank or commission junction and find an ebook about golf, then find golfing forums on the net. Sign up, link your forum signature to your referral link. Then find discussions in the forum that you can add genuine and helpful information to.

This is just a start and it is slow but hopefully you can start to generate an income with this method.