Affiliate marketing is a method of promoting web businesses(merchants/advertisers) in which an affiliate (publisher) is rewarded for every visitor, subscriber, customer, and/or sale provided through his/her efforts. Affiliate marketing is also the name of the industry where a number of different types of companies and individuals are performing this form of internet marketing, including affiliate networks, affiliate management companies and in-house affiliate managers, specialized 3rd party vendors and various types of affiliates/publishers who utilize a number of different methods to advertise the products and services of their merchant/advertiser partners.Affiliate marketing overlaps with other internet marketing methods to some degree, because affiliates are using the same methods as most of the merchants themselves do. Those methods include organic search engine optimization, paid search engine marketing, email marketing and to some degree display advertising.
Affiliate marketing - using one site to drive traffic to another - is the stepchild of online marketing. While search engines, e-mail and RSS capture much of the attention of online retailers, affiliate marketing, despite lineage that goes back almost to the beginning of online retailing, carries a much lower profile. Yet affiliates continue to play a fundamental role in e-retailers' marketing strategies
Compensation methods Predominant compensation methods in affiliate marketing 80% of affiliate programs today use revenue share (Cost per sale) as compensation method. The remaining 19% use Cost Per Action.
Diminished compensation methods The use of pay per click and pay per impression (CPM) in traditional affiliate marketing is far less than 1% today and negligible. CPM requires from the publisher only to load the advertising on his website and show it to his visitors in order to get paid commission, while PPC requires one additional step in the conversion process to generate revenue for the publisher. Visitors must not only made aware of the ad, but also pursue them to click on it and visit the advertisers website.CPC used to be more common in the early days of affiliate marketing, but diminished over time due to click fraud issues that are very similar to the click fraud issues modern search engines are facing today. Contextual advertising, such as Google AdSense are not considered in this statistic. It is not specified yet, if contextual advertising can be considered affiliate marketing or not.
Diminished compensation methods The use of pay per click and pay per impression (CPM) in traditional affiliate marketing is far less than 1% today and negligible. CPM requires from the publisher only to load the advertising on his website and show it to his visitors in order to get paid commission, while PPC requires one additional step in the conversion process to generate revenue for the publisher. Visitors must not only made aware of the ad, but also pursue them to click on it and visit the advertisers website.CPC used to be more common in the early days of affiliate marketing, but diminished over time due to click fraud issues that are very similar to the click fraud issues modern search engines are facing today. Contextual advertising, such as Google AdSense are not considered in this statistic. It is not specified yet, if contextual advertising can be considered affiliate marketing or not.
type of affiliate website
Companies and websites in affiliate marketing
Affiliate sites are often categorized by merchants (advertisers) and affiliate networks.
Affiliate sites are often categorized by merchants (advertisers) and affiliate networks.
The main categories are:
>> Search affiliates that utilize Pay per click search engines to promote the advertisers offers (search arbitrage)
>> Comparison shopping sites and directories
>> Loyalty sites, typically characterized by providing a reward system for purchases via points back, cash back or charitable donations
>> Coupon and rebate sites that focus on Sales promotions
>> Content and niche sites, including product review sites
>> Personal websites (these type of sites were the reason for the birth of affiliate marketing, but are today almost reduced to complete irrelevance compared to the other types of affiliate sites)
>> Blogs and RSS Feeds
>> Email list affiliates (owners of large opt-in email list)
>> Registration Path affiliates that include offers from other companies during a registration process on their own website.
>> Shopping directories that list merchants by categories without providing coupons, price comparison and other features based on information that frequently change and require ongoing updates.
>> CPA networks are top tier affiliates that expose offers from advertiser they are affiliated with to their own network of affiliates (not to confuse with 2nd tier)
Finding affiliate partners (advertisers)
Affiliate networks that have already a number of advertisers usually also have a large number of publishers already. This large pool of affiliates could be recruited or they might even apply to the program by themselves.
Relevant sites that attract the same audiences as the advertiser is trying to attract, but are not competing with the advertiser are potential affiliate partners as well. Even vendors or the existing customers could be recruited as affiliate, if it makes sense and is not violating any legal restrictions or regulations.
Finding affiliate programs (publishers)
Affiliate programs directories are one way to find affiliate programs, another one are large affiliate networks that provide the platform for dozens or even hundreds of advertisers.
Affiliate marketing and Web The rise of blogging, interactive online communities and other new technologies, web sites and services based on the concepts that are now called Web 2.0 have impacted the affiliate marketing world as well. The new media allowed merchants to get closer to their affiliates and improved communication between each other.New developments have made it harder for unscrupulous affiliates to make money. Emerging black sheep are detected and made known to the affiliate marketing community with much greater speed and efficiency.
>> Search affiliates that utilize Pay per click search engines to promote the advertisers offers (search arbitrage)
>> Comparison shopping sites and directories
>> Loyalty sites, typically characterized by providing a reward system for purchases via points back, cash back or charitable donations
>> Coupon and rebate sites that focus on Sales promotions
>> Content and niche sites, including product review sites
>> Personal websites (these type of sites were the reason for the birth of affiliate marketing, but are today almost reduced to complete irrelevance compared to the other types of affiliate sites)
>> Blogs and RSS Feeds
>> Email list affiliates (owners of large opt-in email list)
>> Registration Path affiliates that include offers from other companies during a registration process on their own website.
>> Shopping directories that list merchants by categories without providing coupons, price comparison and other features based on information that frequently change and require ongoing updates.
>> CPA networks are top tier affiliates that expose offers from advertiser they are affiliated with to their own network of affiliates (not to confuse with 2nd tier)
Finding affiliate partners (advertisers)
Affiliate networks that have already a number of advertisers usually also have a large number of publishers already. This large pool of affiliates could be recruited or they might even apply to the program by themselves.
Relevant sites that attract the same audiences as the advertiser is trying to attract, but are not competing with the advertiser are potential affiliate partners as well. Even vendors or the existing customers could be recruited as affiliate, if it makes sense and is not violating any legal restrictions or regulations.
Finding affiliate programs (publishers)
Affiliate programs directories are one way to find affiliate programs, another one are large affiliate networks that provide the platform for dozens or even hundreds of advertisers.
Affiliate marketing and Web The rise of blogging, interactive online communities and other new technologies, web sites and services based on the concepts that are now called Web 2.0 have impacted the affiliate marketing world as well. The new media allowed merchants to get closer to their affiliates and improved communication between each other.New developments have made it harder for unscrupulous affiliates to make money. Emerging black sheep are detected and made known to the affiliate marketing community with much greater speed and efficiency.
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