Understanding Why Affiliate Marketing is Such a Great Business Model Articles | Marketing

By definition affiliate marketing has to do with web businesses promoting themselves by paying a publisher ( who is also called an affiliate) a small percentage every time they help the business make a sale, or every time someone visits their website or subscribes to an email newsletter.

One of the main affiliate marketing programs was started by Amazon.com in 1996. They called the program the Associates Program. Because of this program, individual authors and publishers were able to link up to the big business and large customer base Amazon had to provide. In return for being part of the program, these individuals pay Amazon.com a certain percentage of every book or title they sell through the Amazon.com website. Affiliate marketing hugely depends on how many sites a merchant can link to and the quality of the websites in question.

Online merchants like affiliate marketing because it’s largely free until the affiliates bring in business. Some other marketing models allow people who use this sort of marketing to “pay for performance”. This is great way for start-ups and other small business operations to use marketing services that may otherwise be beyond their own reaches. Affiliates use their own creativity and spend their own money marketing your business and you only pay them a minimal commission when you receive the benefits of their efforts. It’s like having your own internet sales team.

There are two ways to run an affiliate marketing program:

1: In-house affiliate marketing program which requires a lot of maintenance and work on your part.

2: Outsource your program, which is the easiest, cheapest and best option for most e-commerce businesses.

Finding an Affiliate Program

Different directories are available and they can help you discover affiliate programs which match your needs. Different affiliate networks are also available over the internet and they provide you with information on different advertisers that may suit your purposes.

If you’re looking for an affiliate to link to it is important to remember that most programs work within the following categories:

-Search Affiliates (PPC).

-Comparison-shopping directories.

-Loyalty sites: Offering special discounts or bonus points for sales.

-Coupon and rebate sites.

-Content sites: Product reviews, with a link to the product website.

-Blogs and RSS feeds.

-E-mail Lists.

-Registration / Signups.

Multi-Tier Programs:

Something you should look out for and avoid when you get into affiliate marketing for the first time is any multi-tier marketing programs. These sorts of programs distribute commissions through a pyramid style referral network. Reputable affiliates should make money from referrals that are brought in to it and not the referrals that someone else is bringing in.

Affiliate marketing is a great way that e-commerce websites can use to get the news out about their websites and their businesses. The important thing is that you should take the time out to research each affiliate opportunity carefully and ensure that each affiliate that links to you is a reputable one that will give your business a better reputation…. and not the ones that will hinder it.