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Affiliate Marketing and You

Dec 26, 2007
At its heart, affiliate marketing is all about websites driving traffic to one another. In the past decade or so, it has blossomed into an effective advertising tool for business.

How does affiliate marketing work? It involves advertising placed on one website, which when clicked, links to another website.

For example, you may be viewing a book review website. A certain image of a book's front cover may catch your eye. You decide to read the review, and then click on the image. Immediately, this link brings you to a bookseller's website where you can now purchase the book online. The original website where you read the review is an affiliate of the bookseller. They will receive a commission, when you buy, for 'referring' you to the bookseller's site.

Consider the above example. The benefit to the bookseller is that they will receive orders they may never have otherwise. The site that their new customer originally visited sent them to the bookstore because of the affiliate relationship. Advertising on the affiliate site reaped benefits. Without an affiliate network, the bookstore would never have known this customer existed, and vice-versa.

Most businesses that use the affiliate-marketing tool use the 'revenue sharing' model. Under this system an internet marketer will pay an affiliate a percentage of every completed sale sent to them. For the affiliate, the more business they send the partner company, the more their commission.

It is important that an online business use the affiliate-marketing network wisely. If a business sells unique wedding gifts, they do not want to affiliate with just anyone. First off, they should have nothing to do with websites of dubious character. Advertising a classy wedding gift company on a seedy sex-site is not a good thing.

An internet business should trumpet its online presence to customers predisposed to their product or service. Of course, there are exceptions to the rule. Most often, though, you want targeted customers directed to your site who already have an interest in what you offer. You want to market to your niche. Therefore, the bookseller forming an affiliate relationship might do so with a site specializing in book reviews.

What's great about utilizing the affiliate-marketing concept is the way it benefits all parties. Someone may have a simple website promoting his or her hobby. With links to an internet marketer, they could subsidize some of the cost of their site. They link their hobby site to other sites. The ripple effect comes into play. Internet surfers will go on one site, which links to the hobby site, which links to the affiliate partner. In the end, the internet marketer receives customers from all the way down the 'food chain'.

Managing an affiliate-marketing program involves a lot of work for an internet marketer. Some choose to outsource this work to a third party who specializes in these programs. This third party is the 'affiliate network'. There is a fee for a merchant to hook up with an 'affiliate network'. No fee is required from the person who becomes an affiliate of an internet company.

An affiliate network will do the work the affiliates and online marketers choose not to do. For an affiliate, the network tracks their sales from referrals and payments owed to them. For the internet marketer the network processes their outgoing payments. Both parties benefit by not having to do the monitoring work.

An internet marketer and people looking for affiliate programs benefit from the use of a network. They both have access to a virtual mall where they shop for each other. An ecommerce business goes to a network and targets affiliates who are in their niche market. A person who has a website decides which business he or she wants as a partner.
With the web ever growing as a marketplace, affiliate marketing will grow right along with it.

Today's internet marketing companies have the opportunity to forge new relationships. Their relationships should be with those affiliates who have a common business interest.
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