Affiliate marketing, as it is understood today, originated in the 90’s, and is closely linked with the advent of the World Wide Web. The Internet facilitated brand new ways for businesses to market their products or services. Search engines boosted e-commerce, and enabled the development of affiliate marketing. This is how online advertising – which is the short answer to ‘What is affiliate marketing?’ – began to play an important role in getting exposure and increasing sales.
Now, let’s elaborate the question:
What Is Affiliate Marketing?
What is affiliate marketing?
In simple terms, affiliate marketing is a strategy of making money online by promoting a company’s product or service. Affiliate marketing uses the fundamental principle of the Web – which is networking and connectivity- to create a business connection between advertisers, publishers, and consumers. Advertisers are companies, merchants, retailers, or brands that are prepared to pay a commission to have their business promoted. A publisher is a website or blog owner who promotes a merchant’s product or service, earning instead a commission. The publisher posts ads, such as links or banners on his or her website. When people who visit the publisher’s site click on these links or banners, they reach the seller’s website and might buy a product or sign up for a service. The publisher, or the affiliate, is paid per click, per sale or per lead.
Revenue Sharing
Affiliate marketing is an online marketing strategy that works on the principle of revenue sharing. The three main players involved in affiliate marketing- advertiser, publisher, or the affiliate, and customer- all profit from it. Basically, in affiliate marketing, the affiliate acts as an intermediary between the merchant and the customer.
An affiliate program allows you, as an advertiser, to create a network of affiliates, to increase your sales. With affiliate marketing, advertisers pay the publisher for promoting them if and when a conversion takes place. The success of an affiliate marketing program depends on many aspects, including the type of product you’re promoting, traffic, earning your readers’ trust, targeting the right people, and your ability to write compelling sales copy.
Types of Affiliate Marketing
There are three basic types of affiliate marketing: pay per click (PPC), pay per sale (PPS), and pay per lead (PPL).
Pay Per Click
With this method, the publisher or the affiliate earns a certain amount of money or commission every time a potential customer clicks the link found on the affiliate’s website, landing on the merchant’s site. The money may be transferred to the affiliate right away or at regular intervals.
Pay Per Sale
This method works by rewarding the affiliate when a sale is made because of the affiliate’s promotion. Agreements between the merchant and the affiliate may vary: the affiliate can get a percentage, a commission or they can agree upon a flat rate for each sale made.
Pay Per Lead
This marketing strategy is based on rewarding the affiliate whenever a potential client signs up on the merchant’s site, via the advertisement he or she encountered on the affiliate’s site.
Now that you have a basic answer to the question What is affiliate marketing?, you can distinguish it from other forms of Internet marketing, and use affiliate marketing to your advantage, whether you’re an advertiser, a publisher, or a consumer.
More Questions?
Do you have more questions about Affiliate Marketing or have a comment/thought . You can leave your questions or comments in the comment section below or you can contact me at my Wealthy Affiliate profile.
