Saturday, May 24, 2008

Affiliate Marketing & How It Works!

What is Affiliate Marketing?
Affiliate Marketing is a form of advertising, on the internet, that rewards the affiliates (who are self-selected advertisers) for providing the advertiser with traffic, or for subsequent transactions. It is an online channel of advertising in which advertisers (online merchants that sell products or services) pay publishers (affiliates, who are independent parties that promote the products or services for an advertiser on their Websites) only for results, such as a visitor making a purchase or filling out a form.
This is defined as a “pay-for-performance” model as the advertisers only pay their publishers when the new client introduction results in a sale or a lead. This surely makes it a low-risk, high-reward environment for both parties. An affiliate program uses a multi-level marketing concept in which the consumers (affiliates) attract additional consumers. Some affiliate programs are multi-tiered, which raises the income earning opportunities for the affiliates (rewarded both for their traffic and for the traffic of affiliates they recruit). Marketers can develop their own in-house affiliate program (Amazon.com and bn.com are examples), or join one or more of the large affiliate networks, such as (Beefree, Linkshare or CommissionJunction). Affiliates can earn quite significant amounts of money, if they carry out the process correctly, and work hard for results.

How Does Affiliate Marketing Work?
Advertisers in a certain network, populate their ad links in the interface, to make them available for placement by publishers. Every link is assigned a commission, such as a fixed amount per lead or a percentage of a resulting sale on the advertiser’s Website. Upon acceptance, the publishers select and place the advertiser’s links on their Websites, in their email campaigns or as part of search listings.
When the visitor clicks on a publisher’s link, a cookie is set on the visitor’s browser that identifies the advertiser, the publisher, and the specific link and payment rates. If the visitor makes an actual purchase online or fills out a form, that transaction is recorded by the affiliate network, and a commission payment is due for the publisher. Affiliate Marketing is not necessarily a quick or an easy process. Yet, if you are prepared to learn and work hard, it will be great, as it has proven very rewarding for many affiliate marketers.

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