Affiliate Programs

Affiliate Programs

Affiliate Programs

An affiliate program(very used nowadays) is an automated marketing program where aWeb advertiser or merchant recruitswebmasters to place the merchant'sbanner ads or buttons on their ownWeb site. Webmasters will receive a referral fee or commission from sales(this being the source of their profit) when the customer has clicked theaffiliate link to get to the merchant's Web site Web site to perform the desired action, usually make a purchase or fill out a contact form.

Nineteen percent usecost per action (CPA),eighty percent of affiliate programs today userevenue sharing orcost per sale (CPS) as a compensation method, and the remaining programs use other methods such ascost per click (CPC) orcost per mille (CPM).

Two-tier programs exist in the minority of affiliate programs but most are simply one-tier.Multi-level marketing (MLM) or network marketing associations tend to have more complex commission requirements/qualifications than standard affiliate programs.

Companies run affiliate programs to generate leads and sales from other Websites on the Internet. Website affiliates are what make the Internet marketing such an important activity. They give money to the sites who host their ads a commission for products sold through the links on their sites.

Unfortunately for Website owners, affiliate commisions are seldom above 5%, since most Web sales are made with small profit margins.

The first companies that offered these programs saw sales increase very much. After all, these companies basically get free advertising and only pay their affiliates a percentage of the sales they facilitate.

Take one case, if a site owner signs up for Amazon.com's affiliate program, he will receive ad banners or links from Amazon.com that he can place into his site. Then, if a person clicks on the Amazon.com banner or a link on his site and buys something, he will receive a sum of money.

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