What is Affiliate Marketing?
This is one of the most frequently asked questions in this era of online marketing, and here, we will find out the answer in the simplest possible way.
Let's begin with the literal meaning of the word Affiliate.
A person or an organization which is officially attached to a larger business group is known as "Affiliate".
Thus, Affiliate Marketing is a method of online marketing. Here, a person or organization which owns a website, promotes the products or services of another company via the internet, and in return earns commission. Thus these two entities get attached to each other and they both earn a profit by sharing the revenue.
How does it work?
It works through mutual understanding and co-operation. The publisher i.e. The website owner places the advertisements of the merchant's products or services on his website, and if the sale happens through these ads, the publisher gets some commissions.
For example: If you become an affiliate of a company, which sells books, you would have to put the links endorsing their books on your website, and if the company gets some potential buyers or if the sales are made through your link, then you would get commission, which could either be some percentage of the profit or a prefixed amount per sale.
So this is called Affiliate Marketing. When you become an affiliate, you are given a unique code by the company, which helps it in tracking the conversions.
Role of Affiliate Networks
Affiliate Networks are the platforms where publishers (affiliates) and merchants (companies) meet. These platforms help the affiliates, finding suitable programs for them and provide the companies with opportunities to search appropriate websites to endorse their products.
e-bay, click-bank, Amazon, commission junction are some of the most popular affiliate networks or companies.
You can join these affiliate networks for free and can sell the products with zero investment by publishing just a link on your website.
For example: If you join ClickBank, you become a ClickBank affiliate and then you can sell a particular ClickBank product through your website or blog and earn a regular commission on each sale.
Affiliate Marketing- Types
- Pay per Click or cost per click marketing: In this type of marketing, the traffic is directed to the company's website through a link or ad on the affiliate's website. Every time your placed ad is clicked by a customer that leads him to the company's website, you will be paid.
Thus, PPC or CPC is a system of purchasing ads in which the affiliate gets money for every click on his link.
- Pay per Sale: In this type of marketing the affiliate earns money on every sale which is made through his link or ad, placed on his website or blog.
Affiliate Marketing: advantages
Affiliate marketing is advantageous for both the affiliates and the merchants.
For the affiliates, it is the way of earning some extra revenue. If the product is suitable for their niche, they can earn some good commissions by just placing the ads on their sites. No promotions or selling is required on their part. So, there are no investments and only profits.
For the merchants, also the affiliate marketing is very beneficial, as their sale is increased on account of the advertisements of the affiliates. In this way they can attract more and more customers and they need to pay only when a sale is made. Thus their services or products get more exposure in the market.
Affiliate Marketing: disadvantages
Affiliate marketing can have some disadvantages also.
If an affiliate starts promoting a wrong product without enough research, it can affect the reputation of his blog or site adversely. Further, in some cases, it is also possible that the company, for which he is endorsing, doesn't pay him the fixed commission. That's why the affiliate should cautiously inquire about the product and the company before starting the advertisement.
The affiliate marketing can have negative effects on the merchant's business also. If the website contains any objectionable materials, it can harm the merchant's credibility. Furthermore, the profits have to be shared with the third party, this is also somewhat disheartening
From : EzineArticles.com/pooja s aora