Affiliate Marketing

Knowledge Center

What is Affiliate Marketing?

Affiliate marketing is a performance-based marketing strategy in which individuals or businesses (affiliates) promote products or services of another company (merchant) and earn a commission for each sale or action generated through their promotional efforts. It is a promotion method that can be used to reward partner companies for introducing new clients. It can be seen as a digital form of franchising or as an electronic joint venture. The Merchant normally delivers advertising banners and web links to their affiliates. Also the Merchant grants a commission. Normally in return for a click-through to their website, subscription to their service, or purchase of their products which is generated via these links. Affiliates place a tracking code for these ads into their web pages. Each time a visitor on the affiliate's website clicks towards the website of the Merchant, that transaction is registered online. Compensation for the Affiliate may be made based on:

• Pay per click. A certain value for each visit.
• Pay per lead. A certain value for each registration or for each qualified registration.
• Pay per sale. A certain value for each customer or sale.

Origin of Affiliate Marketing. History

Affiliate Marketing can be seen as the modern variant of paying finder's fees to individuals or organizations who introduce new prospects or clients to a business. In July 1996, Amazon launched an associates program that became a huge success.

Usage of Affiliate Marketing. Applications

• Online advertising.
• The approach is most effective when placed in context with quality content.
• Some third parties such as LinkShare, Commission Junction and also Google offer affiliate networks and provide services such as tracking, reporting, affiliate recruiting, payments, sending out end-of-year tax forms, and responses to webmaster queries.

Strengths of Affiliate Marketing. Benefits

For the Affiliate:

• Offer additional products or services to their visitors.
• The opportunity to earn money from their niche audience by up selling or cross selling. Without the need to invest in logistics, financial fulfillment, or back office administration.

For the Merchant:

• No payment is due to an Affiliate until certain results are achieved.
• Typically low-cost and cost-effective.
• Targeted advertising into appropriate niches.
• To get a measurable means of advertising their products or services.
• Extend reach of brand.

Limitations of Affiliate Marketing. Disadvantages

• The success of affiliate marketing relies on the performance, quality and dedication of the affiliates.
• Some affiliate marketers have been accused of spamming to promote their programs. Either in the form of email spamming or by creating multiple websites with the purpose of generating artificial traffic from search engines (spamdexing).
• Websites made up purely or predominantly of Affiliate links are usually regarded negatively as they do not offer any quality content.
• Note that most people don't purchase during their first visit to a website. A cookie can ensure that a referral is registered. If the referred person makes a purchase on a future visit, the original referrer will still be credited for the sale.

Final Remark

At the top and bottom of this page, you can see a remarkable example. You can find some well-known Affiliate Marketing companies which advertise here themselves via this method.

Forum Forum discussions about Affiliate Marketing. Web 2.0 and Affiliate Marketing What does the arrival of Web 2.0 (Interactive web pages) mean for Affiliate Marketing?... 12   1 comments How to Build Network Marketing? Who has any tips on how to build a network marketing initiative with a lot of people? How to recruit them?... 10   3 comments Affiliate Marketing is more suited to products I think Affiliate Marketing is more suited to products then to services. Because in services, it is more difficult to track the significance of the affiliate in the buying process.... 5   3 comments 🔥 How to Manage the Drawbacks of Affiliate Marketing as an Affiliate Affiliate marketing gained immense popularity as a way to generate passive income and build an online businesses. However it is not without its challenges. Below we will explore the main drawbacks of ... 3   Start a new topic about Affiliate Marketing Sign up for free

Courses about Affiliate Marketing. Beginners Course Advanced Course Course for Experts

Expert Tips Advanced insights about Affiliate Marketing. Here you will find professional advices by experts. Consultancy Tips Teaching Tips Practical Implementation Tips 10 Affiliate Marketing Tips Increase affiliate marketing success 1. Provide unique content. Good, unique content is King. 2. Have a holistic website theme. Ensure your logo and graphic... Types of Affiliate websites Marketing, Strategy The different types of Affiliate Marketing websites can be categorized as follows: • Comparison shopping sites and dire...

Information Sources Various sources of information regarding Affiliate Marketing. Here you will find powerpoints, videos, news, etc. to use in your own lectures and workshops. Introduction to E-Marketing | Internet Marketing E-marketing, Web Marketing, Affiliate program, Search engine optimization, Email campaigns, Mobile marketing This presentation covers the topic of E-marketing, divided into various subcategories. It consist of the following secti...

Tools Useful tools regarding Affiliate Marketing. News Videos Presentations   Books Academic More

Compare: 4S Web Marketing Mix  |  Bricks and Clicks  |  Operational CRM  |  TDC Matrix  |  Twelve Principles of the Network Economy

Return to Management Hub: Marketing & Sales

More Management Methods, Models and Theory