What is affiliate marketing?
Affiliate marketing is based on a relationship between two online businesses where one business pays another for sending buyers or leads to an ecommerce Web site. Here are two examples:
Example 1 “Pay Per Sale” : JohnsPetFood.com (Merchant / Advertiser) is an ecommerce Web site that sells pet food. CutePetTricks.com (Affiliate) is a site that teaches people how to get their pets to do tricks. CutePetTricks puts a JohnsPetFood advertising banner and link on their home page. When a CutePetTricks.com visitor clicks on that link, lands on the John’sPetFood.com and buys a package of pet food, JohnsPetFood.com pays CutePetTricks.com a 10% commission on the sale.
Example 2 “Pay Per Lead” : 2LowLoans.com provides low cost car loans. SweetStreetCars.com is a street racing car enthusiast site. SweetStreetCars.com puts a 2LowLoans.com advertising banner and link on one of its Web pages. If a SweetStreetCars.com visitor clicks on the link, lands on the 2LowLoans.com site, and fills out a request for a loan quote, 2LowLoans.com pays SweetStreetCars.com a $10.00 “lead fee”.
You can start to see that this is a great deal for both businesses. The ecommerce Merchant gets qualified traffic from other Web sites promoting the site and the Affiliate has a reliable and low maintenance revenue stream.
If you are selling a product or service online you will want to offer an affiliate program. Here is a list of affiliate networks you can join as an advertiser. If you want to promote other Web sites and earn commissions you will need to join affiliate programs as an affiliate.
How Does It Work?
An affiliate fills out an online appliation to join an affiliate program or network. Once approved the advertiser provides the new affiliate with a unique ID number called an Affiliate ID. This number is inserted into the code of a link that the affiliate places on their Web site. When a visitor clicks on this link the advertiser uses affiliate tracking software to track the visitor using the Affiliate ID. If the visitor makes a purchase, submits an email address, or completes a Web form, the affiliate tracking system will give the affiliate credit and keeps an ongoing tally of how much the affiliate is owed. At a certain point, usually once per month, the advertiser sends a commission check to their affiliates.
