Affiliate Marketing

Affiliate marketing is a web-based marketing practice in which a business rewards one or more affiliates for each visitor or customer brought about by the affiliate's marketing 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 promote the products and services of their partners.Affiliate marketing overlaps with other internet marketing methods to some degree, because affiliates often use regular advertising methods. Those methods include organic search engine optimization, paid search engine marketing, email marketing and in some sense display advertising. On the other hand, affiliates sometimes use less orthodox techniques like publishing reviews of products or services offered by a partner.
Affiliate marketing — using one site to drive Traffic to another — is a form of online marketing, which is frequently overlooked by advertisers. While search engines, e-mail and RSS capture much of the attention of online retailers, affiliate marketing carries a much lower profile. Still, affiliates continue to play a significant role in e-retailers' marketing strategies.

Types of Affiliate Marketing

Affiliate Marketing is classified into many types. All kinds fall under two basic categories. These are pay/click and pay/performance.

Pay/Click

It is also called PPC. It is considered to be the easiest and most popular affiliate marketing method. This is the greatest thing for small websites. With this method the affiliate marketer places the banners and text ads of merchants on his website. The affiliate is paid for every click made on these banners. When any visitor clicks on these banners and visits the merchant website, the affiliate gets credited. It is not essential that the visitor makes a purchase. However, the typical earning for a single click is very small, usually less than one dollar.

Pay/Performance

Pay/performance affiliate marketing, also called PPC, is extremely famous among big affiliates and all types of merchants. In this method the affiliate gets credited only when any visitor from their affiliate id performs the required action. This required action may be a purchase or becoming a member of a merchant website. This method is very good for the merchants because they will only pay when they are paid. For affiliates, it is attractive because they are getting a good share in the sales of merchant products. The usual share is about 15-20% of sale.

If we classify the affiliate marketing on the basis of depth, then it can be divided into 3 classes. These are single-, two-tier and multi-tier programs. Another type is the one in which an affiliate marketer is paid for every sale that is made by a person referred by him. This is called residual income affiliate marketing. Let us study these types in detail.

Affiliate Marketing: 1-Tier, 2-Tier & Multi-Tier

In an affiliate program of single-tier nature, the affiliates get the commission, only, for the visitor´s traffic or sales to the merchant´s website. Pay/performance and pay/click fall under this category.

Talking about Two-tier marketing, the affiliate gets the commission for every action done by the visitors referred by him. Plus he will get the profit whenever some other affiliate, referred by him, gets the commission. So in this way affiliate is earning directly as well as indirectly.

The multi-tier marketing is the same as two-tier marketing. But in this type, the affiliates get the commission for the sales made by their affiliated affiliates in multiple tiers. The depth of this type may be unlimited.

Residual Income Marketing

In this type of marketing, affiliates get the commission for every sale that his referred person makes on the merchant website. The only requirement is that on the first time visit, the person should come from the affiliate link of the affiliate. Next time if the same person visits the merchant website, even without using the affiliate link, the affiliate will be paid for every sale made by the visitor. The question that arises is how the merchant will know the affiliate id. The answer is very simple. On the first visit of the person from the affiliate website, a cookie is created on the computer of the visitor. This cookie stores the affiliate id of the affiliate. This cookie usually expires after 3 months. In some cases it may be longer. Whenever a visitor visits the merchant website, the visitor´s computer is checked for the existence of any previously created cookie. If the cookie is found, the affiliate id is retrieved from it and the affiliate gets credited for any purchase made by the visitor.

Top 5 Worst Affiliate Marketing Mistakes to Avoid

Affiliate Program Marketing is an agreement between a merchant web site and their affiliate webmaster to share profits. The webmaster promotes the merchant's web site and in return, the merchant pays a commission to the webmaster for every new referral.

It's pretty easy to get started with affiliate marketing on the Web. It's also easy to make mistakes. Let us look at the common affiliate marketing mishaps that webmasters need to avoid if they want to succeed in this business.

AFFILIATE MARKETING MISTAKE #1: CREATING BANNER PAGES. This means a web page or pages that have virtually nothing but affiliate banners in them. The webmaster hopes they will get many clicks by displaying many banner ads. What they don't know is it has been scientifically proven that surfers habitually IGNORE banner ads.

AFFILIATE MARKETING MISTAKE #2: ADVERTISING PRODUCTS THAT HAVE NOTHING TO DO WITH YOUR SITE. A webmaster hears about this great poster affiliate program that pays commissions to multiple tiers and gives away free posters. So they sign up. But their web site has nothing to do with posters. Are they going to make any profit? No, they won't.

AFFILIATE MARKETING MISTAKE #3: SELLING PRODUCTS YOU HAVE NEVER USED. Once a potential buyer asked a web merchant, "How many pages is that ebook?" The reply: "Sorry, I don't know and I don't have time to check. " That's a true story. Do you think the would-be buyer purchased the book? No, they didn't.

Never sell something you either don't understand or don't care about!

AFFILIATE MARKETING MISTAKE #4: CHOOSING THE WRONG NICHE. Whatever product you're thinking of selling, trust us, you're not the first. Or are you? Do a keyword search using a Keyword Tool and you'll know. Web site owners often target broad niches that have many other sites competing for them. As a beginner, you're better off with a tight yet profitable niche.

AFFILIATE MARKETING MISTAKE #5: NOT PROMOTING YOUR WEB SITE. We once heard an affiliate marketer complain, "We don't get a lot of hits." As it turned out, their web site was not search engine optimized, and they had never registered their web site with any niche directory.

Too often, naïve web site owners and affiliate marketers think they just have to make their web site, post links and then sit and wait for money to come. It doesn't happen that way. You can't ignore SEO and site promotion in affiliate marketing. It is an ongoing process.

Affiliate marketing on the Web takes work and effort just like any other. It's not a "get rich quick" scheme. The real secret to affiliate marketing is simply—work hard and know your topic. And that's true for everything else!