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How Can You Take Advantage of Affiliate Marketing?

Last Updated
August 22, 2009

What is Affiliate Marketing?

Most marketing involves a company paying a publisher (of a website, magazine, radio station or TV channel etc) for a fixed amount of space or time; whereas affiliate marketing is about the publisher actively promoting a company’s adverts in order to gain money from each sale or enquiry they help generate.

Probably the most widespread example of affiliate marketing is from online retailer Amazon. For many years they have encouraged sites to promote relevant books which then link to Amazon and record the site as the sender of the customer.

The Affiliate System – How it Works

  1. Visitor goes to Site A
  2. Visitor clicks on affiliate advert for ABC Ltd
  3. Visitor goes to ABC Ltd site, Site A is recorded as sending the visitor
  4. Visitor buys something from ABC Ltd site
  5. Site A is recorded as having generated that sale for ABC Ltd
  6. ABC Ltd pays Site A commission for generating the sale.

  7. This article takes a look at both sides of affiliate marketing; how you can use it to make money, and how you can use it to promote your business.

Making Money from Affiliate Marketing

This section looks at how you can make money by including affiliate marketing on your website; and how it compares to running general adverts.

How Does Affiliate Marketing Work ?

Affiliate marketing used to be full of websites trying to get advertising for next to no cost; but it has moved on in leaps and bounds since then. Many affiliate schemes are professionally managed with good incentives to promote them.

Payments

The basic idea of affiliate marketing is online advertising that pays on results; you place the adverts on your site, and sales or enquiries that go through your site are added up every month. This usually works on one of three payment bases:

Cost Per Sale – You receive a fixed payment per sale, or one of a set number of payments depending on the product sold.

Cost Per Lead / Cost Per Enquiry – You receive a fixed payment for every enquiry you generate, this usually means a customer providing their phone number to be called back, or registering their details to be contacted by the company.

Percentage of Sale – You receive a percentage of every sale recorded through the ads on your site. The percentage you receive will depend on what you are advertising.

For more detail on the types of payment used in online advertising visit Pricing of Your Online Advertisement - Where to Place It?.

Direct or Networks

There are two different types of affiliate campaign you can sign up to:

Direct campaigns are where you link directly to the company; they manage the tracking of results, and payments are made from them to you. e.g. Amazon

The other type of affiliate campaign is through an affiliate network; a company that looks after and tracks the campaign on behalf of both the advertiser and yourself. e.g. Tradedoubler, Buy.at

From here on these two will be referred to as ‘Direct’ and ‘Network’.

Article Index

  1. How Can You Take Advantage of Affiliate Marketing ?
  2. Affiliate Marketing - Advantages and Disadvantages
  3. How to Get Started - Making Money With Affiliate Marketing
  4. Promoting Your Business With Affiliate Marketing
  5. Promoting With Affiliate Marketing - Advantages and Disadvantages
  6. How to Get Started - Promoting With Affiliate Marketing
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