Monday

What in The World is Affiliate Marketing?

Simply put, Affiliate Marketing is a means of expanding one’s sales force while paying only for commissions on sales. Or in other words, you pay others to sell your product, but only when they actually sell it – no base salary, benefits, etc…just commissions.

There are many variations on this Affiliate theme. There are programs that will pay you for leads, and some that will pay for just a click. Some affiliates pay you a one time commission, while others will pay residual commissions.

If you can think of it, there are probably programs available that will pay you to promote it.

Let’s illustrate by means of an example:

There are merchants who sell products or services who want to increase their market share. One means of doing so is by offering others a commission to sell their products for them. For example, ABC Company makes toy trains, and Mrs. Smith owns a directory website that lists online companies that sell Wooden Toys. ABC Company has offered a 15% commission for any toy trains that Mrs. Smith sells. So, since ABC Co. offers a variety of wooden toy trains, Mrs. Smith decides to put a special link on her site that links back to ABC Co. ABC Company tracks any visitors that come via Mrs. Smith’s special link and who purchase toy trains. ABC Co. (or a clearing house company that handles Affiliate relationships) tracks all of the transactions, and cuts a check to Mrs. Smith on a regular interval for the commissions she has earned because she sent buying visitors to the ABC Co. website – once setup, her site will continue to send more buyers to ABC Co. and therefore…more passive income comes her way.

So, basically, as an Affiliate, you become part of the Merchant company’s sales force. You promote their product or service, and you get paid for the buying customers which you refer.

There are many ways to refer potential customers. One of the main referral methods is from a website. If you do not have a website, but want to seriously consider Affiliate Marketing, it is recommended to get a website. Creating a website is much easier today than it has been in the past.

So there you have it. Hopefully the mystery of Affiliate Marketing has been demystified.