What is Affiliate Marketing?


Authored by Ted Goodman in Internet Marketing 
Published on 11-20-2008

You hear it from your friends and from business colleagues but have not much idea what it means. Affiliate marketing is not as complicated as it seems to be. It pretty much gives away the dynamics of the advertising model through its name – it is, technically, marketing through partners and affiliates. It is a form of taking care of your advertising workload through outsourcing them to partners who really thrive on such business, and are professionally reliable in bringing promotions, referrals, and customers to your business.

How does affiliate marketing go? These are some basic components of the advertising model that has been made possible online.

Sharing of sales: You are owner of the business will share the revenues of all the sales that you would acquire through the referrals and links of your affiliate marketing partners. The partner, through a website or whatever advertising scheme it is comfortable working with, shall get in touch with potential customers and lead them to a link to your website. Upon the referral, your business shall be coordinating with the customers and take care of their inquiries and business transactions. From the sales that you will be able to get, your partners shall have a share for their services.

Payment schemes: How do you actually share the sales with your affiliate marketing partners? The payment arrangements could differ, and you could arrange for the terms with your partners as necessary. One compensation form is through the number of clicks the potential customers make in the ad or link from your partners website. The second option is through leads, wherein the customer shall enlist in the affiliate’s website and the payment for the registration would be deposited immediately in shared principle. The third mode is through sales, which happens when an actual sale is done through the referral of the affiliate to your business.

Determining the best scheme: In any form of business transaction, the idea is always mutual benefit. If for instance, the ad placement has stayed for a couple of weeks in an affiliate’s site but he does not get compensated for it, then it could strain the relationship. But if ever, you are too lenient with your compensation mechanism, then you might end up losing money without acquiring any sales. The principle is finding a balance between the interests of your business and your affiliate marketing partners. View every partnership as a potential for a long term business relationship.

The items listed above are only some items that you could adhere to when setting up the affiliate marketing business relationships. Although there are more components of the advertising scheme, those mentioned at least would give you an idea how to proceed. Now, you would be ready to get online, set up your website, and find the partners that would help you expand your business and earn more money without the hassle and fuzz of doing the advertising yourself. Maximize your time in building up new products and services, and making your business more attractive for partners and potential customers alike.


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