Simply put, affiliate marketing is a business model in which a merchant pays a third party, known as "the affiliate", a commission for each customer that they referred to the merchant. This is a business model, which is very common amongst companies offering products or services on the Internet. Many of these companies do run an affiliate program of some sort.
Types of Payouts
Traditionally, affiliate marketing meant getting paid a commission
based on a percentage of the sale that was generated. While this model
is still common, there are many other types of payouts available to
affiliates. For subscription type services, many companies now opt to
pay a fixed amount every time a new customer is acquired, regardless of
how long the customer will keep their subscription or for how much
revenue they generate.
Keep in mind that affiliate marketing
does not necessarily mean sales either. Some merchants, notably
automobile finance companies, mortgage brokers and insurance firms pay
affiliates for every qualified lead that is generated, regardless of
whether that person actually becomes a customer or buys a product.
Some other merchants pay a small amount (typically a few dollars) when
the user completes an action, such as: creating a profile on a dating
site, downloading a browser toolbar, signing up for a contest, etc. The
user does not need to give their credit card information or make any
purchase in order for you to get paid.
How to Become an
Affiliate
In order to become an affiliate marketer, all you normally have to do
is sign up for an affiliate program. While some larger businesses run
their own affiliate programs, most deal with affiliate networks. Those
are companies which specialize in Internet marketing and act as a
middleman between affiliates and merchants. Upon joining, the affiliate
gets access to promote many different offers and products from different
merchants.
Ways to Advertise Affiliate Offers
There are multiple ways you can promote offers from affiliate programs online and start earning commissions. Here are the most common ones:
- PPC (Pay-Per-Click) advertising - This consists of putting text ads on search engines, next to the search results for a particular keyword related to the offer you are running. You pay every time someone clicks your ad.
- Media Buying - This simply means buying advertising space on websites, in order to put banner ads, pop-ups or text ads.
- Email marketing - You can promote affiliate offers in emails that
you sent to people who have opted-in to receive promotional material
from you. Note that not all affiliate networks and merchants accept this
type of promotional method, so it is best to check with them first.
Affiliate marketing is a great way to earn money on the Internet. However, just like when starting any other business, you need to put in time and effort to get success. You should also do as much research as possible on the various affiliate programs, as well as methods used to generate visitors to view your offers.